Asian leaders shrug off crisis, seek unity

Asian leaders shrug off crisis, seek unity

TOKYO (AFP): Asian leaders called here on Thursday for a more
united region, including an expanded role on defense, as the
tiger economies slowly got back to their feet.

Philippine President Joseph Estrada took the lead in calling
for a bigger Asian role on the world stage at a conference that
also drew Malaysian Premier Mahathir Mohamad and other regional
policymakers.

He called for new powers to be given to the Association of
Southeast Asian Nations' Regional Forum.

It should have "the mandate and the capability to undertake
preventive diplomacy, conflict-prevention and conflict-resolution
initiatives and activities," Estrada told the symposium.

The forum, which groups ASEAN and its dialog partners, should
be able to respond to disputes or conflicts, he said, while
stopping short of explaining what such a response should entail.

Alternatively a new East Asian security arrangement should be
set up, Estrada said.

The Philippine leader, who also called for Asian nations to
bind their economic futures together with a single regional
currency, was alone in calling for a stronger military role.

Japanese Foreign Minister Masahiko Komura, for example,
stressed that the U.S. military presence in Asia was "important
and essential" to regional stability.

But the theme of an Asia standing on its own feet was echoed
by other leaders, most of whom declared that the region had
emerged from the worst of the financial crisis that erupted in
July 1997.

Asia as a whole was at an "early stage of recovery,"
Malaysia's outspoken leader said.

Mahathir pressed for reviving an idea, proposed by Japan, of
creating an Asian version of the International Monetary Fund.

"It is unfortunate that the Asian Monetary Fund has not
started at the time because it was at this time when money was
most needed," he told reporters before the symposium.

Mahathir later told the conference that Asia must work for
fundamental reform of the financial system. But "in the face of
the world's failure to achieve this, each nation must fend for
itself as best it can."

South Korea, lauded by many countries in the West for its deep
restructuring program, echoed the Malaysian leader's criticism of
the West's failings over the Asian crisis.

"There has been little effort to improve prudential regulation
and supervision of financial institutions either at the global or
regional level," said Lee Hun-jai, chairman of South Korea's
Financial Supervisory Commission.

A key lesson of the financial crisis was that the breaking
down of barriers to money movements had increased their volume
and volatility, Lee said.

But "even after two years of intense debate on the need to
reform the international financial system, little progress has
been made in building a new architecture for efficient crisis
management and prevention," he added.

"Worse yet, G-7 countries have dominated these discussions."
Leaders of the Group of Seven (G-7) nations -- Britain, Canada,
France, Germany, Italy, Japan and the United States -- are to
discuss reform of the global financial system at their June 18-20
Cologne summit.

"Emerging market economies are hardly represented and, as a
result, they have not been able to articulate their views," Lee
said.

"To have a stronger voice in the ongoing debate, East Asian
countries must close ranks."

Indonesian Foreign Minister Ali Alatas said a key lesson of
the crisis was that "people matter" and that while liberalization
was desirable, "in the long run it will only work for the economy
if the necessary prudential safeguards are in place."