Asian economic chiefs outline reform commitment

Asian economic chiefs outline reform commitment

FUKUOKA, Japan (AFP): Finance chiefs outlined yesterday their
commitment to reform at the Asian Development Bank annual meeting
here as differences over the entry of North Korea simmered on the
sidelines.

At the bank's 30th anniversary meeting, finance ministers and
central bankers from major Asian economies vowed to stick to the
road of reform.

Finance ministers and central bankers from China, the
Philippines, Indonesia and Vietnam expressed confidence in reform
and their economic futures.

India pledged to press ahead with change but without risking
education and health.

The United States, meanwhile, called for change at the bank
itself, urging that it give greater support to the private sector
while maintaining its key role of easing poverty.

Indonesian Finance Minister Mar'ie Muhammad said his country's
economy was likely to expand at a rapid pace this year with
little sign of overheating.

"We are confident that the economy will again register strong
economic growth in 1997," he told the annual meeting, citing the
positive impact of recent deregulatory steps.

"Despite the strong expansion, the Indonesian economy has
shown few signs of overheating," he said.

People's Bank of China governor Dai Xianglong forecast
economic growth of eight percent and inflation below six percent
in the next few years.

Dai said the Chinese economy had now "embarked on a track of
sustained, rapid and healthy growth" following various concerted
efforts.

"The macro economic adjustment that was primarily designed to
overhaul inflation has reached expected goals," the central bank
governor said.

He also promised to strengthen the role of Hong Kong as a key
financial base after the British colony reverts to Chinese rule
on July 1.

"Hong Kong's role as an international financial center will
continue to be maintained and strengthened," Dai said.

Transformation

Philippine Finance Secretary Roberto de Ocampo said the
country would accelerate economic reforms to sustain its recent
transformation from the "sick man of Asia" to the region's "new
tiger,"

"We shall not allow seeming success to lull us to sleep," he
told the annual meeting of the Asia Development Bank (ADB).

"Indeed, this has been our prod to push further in the road of
reform-comprehensive tax reform, deregulation and privatization,
strengthening bank regulation and supervision, and more openness,
transparency and depth in the capital market."

Indian Finance Minister P. Chidambaram joined his colleagues
in vowing to press ahead with fiscal reforms but added that his
government was not about to sacrifice spending on education and
health.

"We can and we will bring about further reductions in the
fiscal deficit, without impairing the capacity to enhance
investments in key sectors of the economy, particularly the
social sectors such as education and health," he told the
meeting.

Vietnam's central bank governor Cao Sy Kiem said the country's
economy showed "encouraging" signs during the first four months
of this year and promised to push ahead with reform despite
difficulties involved.

The United States called on the development bank to give
greater support to the private sector in the region while
maintaining its key role of easing poverty.

"The bank can play an increasingly visible and catalytic role
in support of the private sector," US delegation chief Timothy
Geithner said on the second day of the bank's annual meeting.

On the sidelines, meanwhile, South Korea supported North
Korea's request to join the Bank, putting it at odds with Japan.
"Considering the ADB's invaluable contributions to the rapid
progress of the Korean economy, I think it is clear that North
Korea would also benefit from ADB membership," South Korean
Finance Minister Kang Kyong-Shik said.

Japan's Finance Minister Hiroshi Mitsuzuka said Sunday that
Tokyo would consider North Korea's membership of the Manila-based
bank. "Japan will consult with diplomatic authorities and other
countries concerned and consider the matter cautiously," he said.