ASEAN ministers say back in economic recovery after crisis

ASEAN ministers say back in economic recovery after crisis

David Brunnstrom, Reuters, Yangon

Southeast Asian finance ministers agreed on Friday their
region's economy was back in recovery mode but said this needed
to be consolidated and protected from outside shocks through
further reform.

While calling for closer cooperation to boost recovery, the
ministers from the 10-member Association of South East Asian
Nations conceded that different levels of development and market
conditions in their diverse bloc meant no one economic formula
would fit all countries.

After the gloom of the 1997 Asian crisis compounded by last
year's global downturn, the mood at their meeting in Yangon was
at last more upbeat.

"There is a strong consensus about the state of affairs in
ASEAN," Philippines Finance Minister Jose Comacho told Reuters.

"It's in a good shape both externally as well as within the
region, in the countries, in terms of structural reforms that are
ongoing, measures that are being taken.

"It's recovering. What was also noted was that if you look at
year-on-year it may not be reflected, but if you look at quarter-
to-quarter it's actually happening already."

Haji Abdul Aziz Umar, from tiny oil-rich Brunei, a country
benefiting from the recent price surge in the commodity, said the
recovery would require careful handling, but added, "I think we
have seen the light at the end of the tunnel."

Other officials, including Indonesia's minister, Boediono,
concurred. "The overall mood is towards the better at the moment,
so I think we all feel that positive sentiment," he said.

Last year's global downturn led to a big export slump in Asia,
particularly hitting hi-tech producers such as Singapore and
Japan and ministers said the focus was now on boosting domestic
demand. But varying conditions meant individual approaches must
differ.

"No one solution fits us all perfectly, so there must be some
adaptation and some variation," Singapore's Second Finance
Minister Lim Hng Kiang told Reuters.

He said countries were being careful not to create long-term
structural problems when acting to boost demand.

Thai Finance Minister Somkid Jatusripitak, whose country's
balance of payments crisis sparked Asia's crisis, said ASEAN
needed to become a strong network to keep its economies strong.

"They should not only depend on external economy," he said.

The Asian Development Bank (ADB) delivered some good news this
week, saying the region was expected to see a "moderate" rebound
this year helped by "very encouraging signs of recovery" in the
United States and partial recovery in Europe.

But Pradumna Rana, the ADB's director for regional economic
monitoring, warned that risks remained, given serious imbalances
in the United States and high world oil prices. And he said the
extent of the upturn would vary from country to country.

Before wrapping up their meeting on Saturday, the ministers
were to sign protocols on tariffs and on further liberalizing
financial services.

An ASEAN official said the latter would recognize that
countries like Cambodia, Laos and Myanmar were likely to move
more slowly in certain areas.

Meeting Japanese, Korean and Chinese dialogue partners on
Thursday, the ASEAN countries discussed expanding a regional
currency swaps network Tokyo has championed.

It now involves agreements worth $15 billion to provide rapid
help if a currency comes under speculative attack as in 1997.

Some see this as a precursor to an Asian Monetary Fund but
Japan made clear an Asian fund was still on the back burner.

"Maybe it's kind of some target, but within one or two years
it is very difficult to have that," Hiroshi Watanabe, deputy
director-general of Japan's Ministry of Finance, told Reuters.

"Still the level of economic stages is quite different. It's
quite different from the European area, so in order to have some
kind of multilateral institution, it will take some time."

Watanabe said delegates had urged Japan to restore growth and
pursue structural reform and he had replied that Tokyo was
working hard to restore growth by the second half of the year.