ASEAN warns against foreign interference

JAKARTA (JP): The ASEAN Chambers of Commerce and Industry (ASEAN-CCI) warned yesterday of wide and serious consequences of the multilateral investment treaty and competition policy proposed by developed countries.

"We have to advise the governments from the Association of Southeast Asian Nations (ASEAN) to be cautious about such proposals because they have wide and serious implications," Paul Low, deputy chairman of the ASEAN-CCI, told a press briefing here after the closing ceremony of its council meeting and conference here.

President Soeharto yesterday opened the meeting which was attended by over 200 executives from ASEAN countries -- Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

In his opening remarks, Soeharto invited any input from ASEAN- CCI, especially "to prevent efforts by advanced countries to use irrelevant issues as a pretext for veiled protectionism."

Later, speaking on the investment treaty proposed by the European Union, Paul Low noted that the treaty actually requests "national" treatment for foreign investment.

Under such a treaty, the government will not be allowed to extend special facilities to local companies to improve themselves unless it extends the same facilities to foreign companies.

"I think that kind of treaty is not fair, particularly for developing countries in ASEAN," Low told the press conference, which was presided over by the new chairman of the ASEAN-CCI, Aburizal Bakrie.

He reasoned that developing countries need to extend some benefits to local companies to prepare them to compete in the global market.

The Indonesian government has said that it accepts measures to boost investment across countries but rejects the idea of establishing multilateral investment codes as proposed by the European Union.

It argues that the multilateral agreement will impede the growth of small and medium-sized local enterprises because foreign capital will affect all sectors. The treaty will only protect foreign investment and investors, while neglecting the people in the countries where the investment is to be located.

The Union has been campaigning to get the first ministerial meeting of the World Trade Organization (WTO) in Singapore in December to discuss the establishment of a multilateral agreement on direct foreign investment.

"So we would like to advise the ASEAN governments that they have to be cautious... We feel very strongly that when they discuss trade issues in Singapore, they should not link them to other issues, such as investment," Low said.

Low noted that another issue very likely to be brought up by advanced countries in the upcoming WTO ministerial meeting would be competition policy.

"We also think that developing countries in ASEAN are not yet ready for a comprehensive adoption of such a competition policy," Low contended.

"This does not mean that we are against competition," he said. "However, a competition policy like the anti-trust policy in the United States or Europe, is not necessarily applicable to ASEAN countries -- our industrial structures are different to theirs."

Low, also leader of the Malaysian delegation at the ASEAN-CCI meeting, noted that some ASEAN countries still need to create big companies to compete overseas, and need some monopolies to cultivate these companies, so they can become multi-nationals.

"So in the forthcoming WTO ministerial meeting, we should concentrate on trade alone, not on other issues, such as investment or competition policy issues," Low suggested. (rid)

Photo -- Page 9