Asian rapid growth could cause friction

Asian rapid growth could cause friction

SINGAPORE (Reuter): Singapore Prime Minister Goh Chok Tong said yesterday Asia's rapid economic growth could lead to friction, especially with the emergence of China as a leading economic superpower.

"Within Asia, growth rivalry can easily lead to friction, tensions or conflict," Goh said in a speech to a one-day meeting of the U.S./ASEAN Business Council in Singapore.

"Asia's economic renaissance, particularly China's emergence, will shift the center of gravity of the international economy and alter the strategic balance," he said.

"However, there are few precedents for such a major change to the world or regional order to take place peacefully, and to the benefit of all."

Goh said that in the next 25 years, the economies of China, Indonesia, South Korea and Thailand would become some of the world's 20 largest.

U.S.-Chinese ties have been rocked in the past year by bitter wrangling over trade issues ranging from the rapidly expanding U.S. trade deficit with Beijing to problems over enforcement of intellectual property laws.

Goh said one way to head off any potential conflicts would be through increased economic cooperation.

"This will help the region develop as a whole without leaving residual pockets of stagnation and poverty which can be destabilizing," he said.

Goh said it was also vital for the Association of Southeast Asian Nations (ASEAN) to boost economic ties with the United States, a major market for the exports of the region and a main source of investments.

"We recognize that without the U.S. as a major source of investments and technology, and a major market for the Asian economies, growth and development of our economies would never have taken off," he said.

ASEAN groups Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.