Asia over the worst, but more grief to come
Asia over the worst, but more grief to come
SINGAPORE (Reuters): Asia is over the worst of its economic
crisis, but there is still more suffering to come, Malaysian
Deputy Prime Minister Anwar Ibrahim said on Thursday.
"The worst is over, but we'll have to weather the storm a bit
more," Anwar told a news conference after traveling to Singapore
to speak to businessmen.
Anwar said Indonesia's latest deal with the International
Monetary Fund (IMF) on a new package of economic reforms and
targets in return for a US$43 billion rescue package was "most
encouraging" and "most welcoming".
On Wednesday, the IMF and Indonesia managed to iron out
differences which had delayed the release of the IMF's second
tranche of funds in March and kept international financial
markets dubious about Jakarta's commitment to reform.
Anwar, who is also finance minister, said he believed most of
the nagging issues, including subsidies and other social issues,
"have been adequately addressed" in the deal, the third to which
Jakarta has agreed.
But he slammed into multinational corporations, calling them
"incredibly negative" and "excessively cynical" about Asia's
attempt to recover from a shattering crisis which has resulted in
IMF rescue packages of more than $100 billion.
"There is a growing cynicism or increasing skepticism on the
ability and commitment of East Asian governments to overcoming
the current economic travails," he said.
"I say we have the resolve to overcome this ... and we will
overcome this and emerge with greater vigor and vitality."
Reflecting Malaysia's willingness to tackle the crisis was its
willingness to change a long-cherished policy of giving economic
priority to ethnic Malays in an economy dominated by ethnic
Chinese, Anwar said.
"Adjustments are necessary and other adjustments will be made
when necessary," he said. The changes to the so-called Bumiputra
policy were "a permanent feature", he added.
"Our concern is with the overall economic cake which must be
shared, and the Bumiputra share capped at 30 percent," he said.
Anwar said Malaysia, one of the Asian "Tiger" economies which
fell into crisis last year, would continue to liberalize its
investment restrictions in order to deepen competition and
quicken the revival of capital flows.
Malaysia has already raised the limits on foreign ownership in
the telecommunications sector to 49 percent, in the insurance
sector to 51 percent and in the stockbroking industry to 49
percent, he said.
And he repeated that companies in trouble could not expect to
be rescued by the government.
"We are not in a position to bail out companies. If they have
to go, they have to go. My duty as a finance minister is not to
facilitate bankruptcies or bail out companies."