ASEAN nations told to address credibility crisis

ASEAN nations told to address credibility crisis

BANGKOK (AFP): Singapore's deputy premier Lee Hsien Loong urged ASEAN nations on Thursday to put aside their differences, boost economic cooperation and reverse the perception their alliance was "weakened and drifting".

Lee said the 1997 regional meltdown not only devastated regional economies, but also fractured efforts to launch agreements that would have freed up trade and investment among Association of Southeast Asian Nations (ASEAN) members.

"The crisis has also raised doubts about ASEAN's credibility and relevance as a regional organization," he told a luncheon hosted by the central Bank of Thailand. "ASEAN appeared divided and slow in responding to the crisis, and even now is seen as weakened and drifting."

Lee said the expansion of ASEAN to 10 members, while crucial for long-term strength, had made it "harder for the organization to maintain focus and reach consensus."

With military-run Myanmar and communist Laos and Vietnam now in the fold, ASEAN's policy of non-interference in members' affairs has been more sorely tested than ever.

The deputy prime minister said that as a result of these distractions, the world now doubted whether ASEAN would ever be able to pursue economic cooperation, lower trade barriers and restore prosperity and confidence. "ASEAN countries must not allow this situation to continue," he warned.

He urged his neighbors to accept globalization as a reality that must be harnessed for their own benefit, and to embark on the painful process of deregulation and liberalization that it required.

The pre-crisis momentum that spawned major initiatives like the ASEAN Free Trade Area (AFTA) and ASEAN Investment Area must also be recaptured, he said.

"The crisis has caused some countries to hold back, in order to give struggling domestic industries more breathing space.

"(They) should not lose sight of the wider benefits of ASEAN cooperation to their economies as a whole."

Thailand, Malaysia, Singapore and Brunei -- as countries faring better than other members -- should lead the push to put ASEAN cooperation on track again, he said.

Singapore, ASEAN's strongest economy, has been criticized by its neighbors for forging free-trade agreements outside the ASEAN grouping.

But it has defended its policy, saying that by entering into sub-regional pacts, the small but prosperous island-state is helping draw attention to the ASEAN region, whose poorer members are not prepared to forge similar accords.

Singapore ministers have warned several times in recent months that ASEAN risks becoming a "sunset organization" eclipsed by its more vibrant Northeast Asian neighbors.

"If ASEAN economies do not deliver by way of structural reforms and strong, sustained economic recovery ... international investors will relegate us to the sidelines, and we will be marginalized," Lee said.