ASEAN states reassure world of economic reforms

By Vincent Lingga

HONG KONG (JP): Thailand, Malaysia, Indonesia and the Philippines have reassured the world's financial leaders of their strong commitment to liberalization and continuous structural reform measures.

"We are committed to the liberalization process because we have seen and enjoyed the results," Malaysia's Deputy Prime Minister and Minister of Finance Anwar Ibrahim told the annual meeting of the International Monetary Fund and World Bank here yesterday.

Anwar said Malaysia had always been committed to a market- driven economy and had pursued a consistent program to reduce the role of the government.

Finance Minister Thanong Bidaya of Thailand, where the currency crisis started in early July, assured that the Thai government would address the underlying factors that had contributed to the currency crisis.

"We pledge that we shall never waver from any and all actions required to restore stability and confidence," Thanong told the meeting yesterday.

Thanong took the opportunity to thank countries, including Indonesia, and multilateral agencies which had worked quickly to arrange a US$17.2 billion financial bail out for his country.

Indonesia's Minister of Finance Mar'ie Muhammad told the same forum Monday that his country would continue to maintain the sound and prudent economic policies that have been demonstrated over the past 30 years.

"We are in favor of market mechanism but we would like to urge the IMF to play a more active role in maintaining exchange rate stability," Mar'ie added.

Mar'ie briefed the finance ministers and central bankers from the 181 members of the IMF and World Bank on the series of reform measures Indonesia had taken so far.

He also attached to his prepared speech the English version of the Indonesian government announcement on Sept. 3 regarding policies to deal with the impact of rupiah fluctuations.

The measures include a budget retrenchment, rescheduling and shelving of many big private-sector projects and a more vigorous reform of the financial sector, including cleaning the banking sector of insolvent banks.

Philippines Secretary of Finance Roberto de Ocampo told the meeting yesterday his country saw no alternative to globalization and integration as it was the only way to jump-start its economy out of poverty.

"When the markets talk, we will listen," Ocampo assured the boards of governors of the two Bretton Woods institutions which are to conclude their annual meeting today.

He asserted that the Philippines economy had been fortified by the fundamental reforms implemented under an extended IMF arrangement.

Anwar also highlighted positive impacts of the recent financial turbulence in Southeast Asia.

"The financial turbulence has provided the impetus for the formation of a forum to discuss common regional issues as well as explore remedial policy action," Anwar added.

The forum, he said, provides a basis for the establishment of a facility to enhance efforts toward economic and financial stability.

"In the ASEAN region, we have finished a framework to facilitate effective consultations and discussions," Anwar said in response to an earlier suggestion from the IMF's managing Director Michel Camdessus on the importance of peer pressure to ensure appropriate policies.

But he suggested the IMF special data dissemination standards be expanded to enhance transparency of the activities of all market players.

"The IMF should also devise a framework to enable countries to adapt and cope more effectively with market excesses associated with destabilizing capital flows," Anwar said.

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