ASEM proposes investment action plan
ASEM proposes investment action plan
BANGKOK (JP): The chairman of the Asia-Europe Meeting (ASEM), Thai Prime Minister Barnhan Silpa-archa, proposed that both sides draw up an investment action plan to promote greater bilateral investment.
Speaking at the opening of the two-day inaugural meeting here yesterday, Barnhan suggested that leaders of the 25 Asian and European governments establish a joint government and private sector working group within six months to draft the action plan.
Barnhan said an action plan is necessary to encourage the private sector on both sides to seek investment opportunities.
"Such cooperation would open up valuable opportunities for our private sectors. Private sector interaction is a key component in reconnecting Asia and Europe," Barnhan said in his opening speech.
He suggested the establishment of an Asia-Europe Business Forum, similar to the Pacific Business Forum of the Asia-Pacific Economic Cooperation forum.
Informed sources here said that ASEM will likely agree to create an Asia-Europe Business Forum. Thailand has offered to host a meeting of the forum early next year.
"This forum could also play an important role in helping draft the Asia-Europe Investment Promotion Action Plan," Barnhan said.
A Thai official was quoted by the local press as saying that Barnhan's proposed action plan would involve studies to identify sectors offering investment opportunities, to formulate financial networks to support investment, and to discuss post-investment measures such as the treatment of labor and environmental standards.
Vice President of the European Commission, Leon Brittan, said yesterday that he welcomed the ASEM chairman's investment promotion action plan.
Barnhan's proposal, however, differs from the European Union's (EU) multilateral treaty on foreign direct investment proposal. The EU's proposal seeks to establish rules for further opening markets to foreign investment, providing guarantees on profit repatriation, and ensuring national treatment.
Indonesia's spokesman, State Secretary/Minister Moerdiono, noted that Indonesia supports measures that boost investment in both regions. Indonesia rejects, however, the idea of establishing multilateral investment codes as proposed by the EU.
Moerdiono argued that the multilateral agreement would impede the growth of local small and medium enterprises because foreign capital would affect all sectors.
He said it would only protect foreign investment and investors, while neglecting the people and the places where the investments would be located.
The EU has been campaigning to get the first ministerial meeting of the World Trade Organization (WTO) to discuss the establishment of a multilateral agreement on direct foreign investment. The meeting will be held in Singapore in December.
The union is seeking Asian support, especially from Asian participants in ASEM, for the creation of such a treaty.
In his opening speech, Jacques Santer, president of the European Commission -- the EU's executive body -- asked participants to use ASEM to introduce new subjects to the WTO and to identify their main concerns.
"Let us work together on investment and intellectual property rights," Santer said.
The European delegates want to boost investment in Asia to catch up with investment from North America, Japan, Taiwan, South Korea and Singapore.
Direct foreign investment from the EU represented 10 percent of East Asia's total foreign investment between 1986 and 1992.
Increased investment between Asia and Europe is expected to help raise trade between the two regions.
According to European Commission figures, the value of trade between the EU and Asia totaled some US$312.5 billion in 1994, about 25 percent larger than the two-way trade between the United States and the EU, which stood at $235 billion.
The EU's trade with the Association of Southeast Asian Nation (ASEAN) hit $74 billion in 1994, higher than its trade with all of Latin America.
The Asia-Europe Meeting is made up of the 15 members of the EU -- Austria, Belgium, Britain, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain and Sweden -- the seven members of ASEAN -- Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam -- and China, Japan and South Korea. (mds/rid)