ASEAN prepares for eventual aid summit with Japan

ASEAN prepares for eventual aid summit with Japan

HANOI (AFP): Southeast Asian finance officials wrapped up two days of talks on Friday that prepared the stage for a summit with Japan, but stopped short of spelling out a common approach on the use of promised aid from Tokyo.

The Association of Southeast Asian Nations (ASEAN) officials discussed Japanese plans to help stricken Asian economies, including a 30-billion-dollar initiative unveiled by Finance Minister Kiichi Miyazawa, delegates said.

At the two days of talks which ended Friday, they also heard a proposal advanced by the Jakarta-based ASEAN secretariat for a collective fund that could be set up with Japanese aid.

ASEAN deputy secretary-General Suthad Setboonsang said however at the end of the meeting that while the idea of a collective fund was "good," "there are many ideas that are floating" on the use of the money.

"But I don't know whether ... we're going to have a common position," he said. "They'll resolve among themselves in ASEAN," he said.

In Tokyo, a senior government spokesman said Friday that Japan wants to press ahead with an Asian fund to deliver financial aid to its ailing neighbors despite strong US opposition to similar plans in the past.

Suthad noted Japan had come out with a series of proposals. Besides the Miyazawa package, which may be enlarged, Prime Minister Keizo Obuchi will next week offer new loans worth some eight billion dollars to Japanese firms working in the region, according to Japanese officials.

In addition Japan has agreed a five-billion-dollar aid program with the United States, of which Tokyo will give three billion dollars.

"There are so many funds ... I don't know how they are going to lay them out at the end. Let's wait and see," Suthad said. He said there was no proposal to force "Japan into anything" on how the aid should be channeled or who should get how much. T he Miyazawa fund was targeted at four ASEAN members -- Indonesia, Malaysia, the Philippines and Thailand -- as well as South Korea, whose President Kim Dae-Jung will also attend the summit here Wednesday.

But Vietnam has also asked for help under the scheme. Other ASEAN members are Brunei, Laos, Myanmar and Singapore. Obuchi is expected to spell out details of the various Japanese proposals to help ailing ASEAN economies as well as plans to lift his own country out of recession.

"They (Japanese) will be coming out with more details than were previously known," ASEAN secretary-general Rodolfo Severino said. "There are certain areas in which Japan and ASEAN can cooperate."

The finance officials' talks also discussed prospects of forging a common negotiating strategy with Japan, delegates said.

"We want to deal with the Japanese not as each country but as a group," an Indonesian official said.

"We want to try to avoid the Japanese dealing with us individually," he said. "If we deal with it as a group, we'll have more bargaining power."

Tokyo and ASEAN pushed hard last year for a regional fund that would have been funded with Japanese money to rescue economies in crisis.

But the proposal was killed by strong opposition from the United States and multilateral agencies such as the International Monetary Fund, which believed it was a ploy to undercut stringent conditions attached to IMF aid.

The finance officials also finalized contributions to communiques to be issued at the end of the summit, which will focus on ways to extricate the region from crisis and put it back on the path of growth.

Severino said they were "most interested" in forging cooperation between their financial institutions.