ASEAN praised for its action on crisis

ASEAN praised for its action on crisis

By Meidyatama Suryodingrat

BANGKOK (JP): Member states of the Association of Southeast
Asian Nations (ASEAN) were praised here on Friday for taking
tough action to overcome its economic crisis, but were also
warned that further structural reform was needed to achieve a
sustainable recovery.

United States Secretary of State Madeleine Albright lauded the
progress made during ASEAN's two-day Post Ministerial Conferences
(PMC) saying that the financial and economic crisis is "a test
that ASEAN is passing".

"The hard decisions that some ASEAN nations had the courage to
make on banking reform and privatization are paying off," she
told the opening session of the PMC which brings together the 10
ASEAN members with their 10 dialog partners.

She noted that stability and growth in the region in the
future will depend on several factors: market fundamentals which
include regulation and investment; electronic initiatives such as
internet readiness and paperless trading; along with a web of
connections to electronic commerce.

"A critical component of this effort will be strengthening the
rule of law and curbing official corruption and cronyism,"
Albright said.

South Korean Foreign Minister Lee Joung-binn in his address
noted the tough steps that the ASEAN countries and his own have
had to take and endure as a result of the crisis.

"The transformation has had its cost. The restructuring has
been painful. It seems that not a single day goes by without
differing groups clashing against each other," he said.

Albright stressed that Washington remains committed in
assisting the recovery and reforms needed. She noted that the
United States believes that "trade, not aid" is the best way to
foster sustainable economic development.

Aid, according to Albright, can play a useful role in
"jumpstarting" development and in responding to disasters.

U.S. assistance has increased from US$201 million in 1999 to
$226 million this year.

Australian Foreign Minister Alexander Downer also noted that
while the rebound over the past 18 months has exceeded
expectations, caution remains appropriate.

"It may be the removal of key pre-crisis vulnerabilities, like
overvalued, pegged exchange rates, low foreign reserves and
excessive short term debt, has reduced the risk of a similar
acute crisis in the future," Downer said.

"But further structural reform, particularly financial and
corporate restructuring, is needed to achieve sustainable
regional recovery".

Downer further called on his ASEAN colleagues to remain alert
to external developments, such as a slowdown in the U.S. economy
which could severely limit growth through a drop in demand for
exports.

"This initial driver of recovery, net exports, continues to
perform strongly. But stronger import growth is reducing trade
surpluses in many East Asian economies," he said.

Following a general session of all 20 foreign ministers or
their representatives during the opening PMC session, the
respective ministers broke for individual sessions in which ASEAN
delegates or ministers met with each of the 10 dialog partners
individually in separate sessions.

During the ASEAN-China session, both Malaysian Foreign
Minister Hamid Albar and Indonesian Foreign Minister Alwi Shihab,
who arrived Friday morning from Indonesia, welcomed and urged
their Chinese counterpart Tang Jianxuan to proceed further on
talks on a Code of Conduct for the South China Sea.

Malaysia is the ASEAN coordinating country in dialogs with
China, while Indonesia is the next coordinating country to take
over from Malaysia.