Developing states to assess market turmoil

Developing states to assess market turmoil

KUALA LUMPUR (Reuters): Leaders of developing nations from three continents gather in Malaysia next week to press for greater access to rich countries' markets and assess the global financial turmoil that has engulfed their economies.

Authorities said trade, investment and currency fluctuations would be at the center of the agenda when the Group of 15 (G-15) nations hold their annual three-day summit in a cavernous new hotel outside Kuala Lumpur starting on Monday.

The emphasis on business and commerce was underscored by the decision to have trade and economic ministers from the member countries meet for the first time ahead of the summit.

They will gather on Friday with World Trade Organization (WTO) Director-General Renato Ruggerio, followed by a meeting of foreign ministers on Saturday.

The G-15 members are Algeria, Argentina, Brazil, Chile, Egypt, India, Indonesia, Jamaica, Malaysia, Mexico, Nigeria, Peru, Senegal, Venezuela and Zimbabwe. Kenya will be admitted as the 16th member during the summit.

Formed in 1989 as a forum for countries from the Southern Hemisphere, it has sought to abandon the confrontational approach that characterized North-South relations before the end of the Soviet Union, and focus instead on trade and investment.

But with Malaysia's outspoken prime minister, Mahathir Mohamad, as host, the summit was not expected to dodge the controversial issue of currency swings, which the Malaysian leader has blamed on speculators.

"You can assume that current international issues such as currency speculation will be discussed," senior Foreign Ministry official Abdul Kadir Mohamad said recently.

Malaysian officials said that along with Mahathir, the heads of state or government from Algeria, India, Indonesia, Egypt, Kenya, Nigeria, Peru and Zimbabwe were expected.

However, India's Prime Minister Inder Kumar Gujral on Wednesday abruptly canceled his attendance at the summit, "to attend to domestic issues", a government spokesman said. The premier had been criticized for his back-to-back trips.

Indian Vice-President Krishan Kant will now lead the delegation to Kuala Lumpur, Indian officials said on Wednesday.

The summit comes at an opportune time for Mahathir, who was expected to win support for his drive to rein in currency speculation which he says has undermined Malaysia's economy.

But summit leaders were not expected to adopt specific recommendations on currencies.

"No, we wouldn't go that far yet at this first meeting," Malaysian Trade Minister Rafidah Aziz said last week. "If they want to discuss it, why not, but at the moment our focus would be trade and investment facilitation measures."

The G-15 will be looking to adopt a common stance towards trade issues expected to dominate a WTO ministerial next May.

"We do have a common stand where it affects us all together," Aziz said. "In the WTO we are saying that there is no place for extraneous issues such as social clause and labor standards."

The G-15 locked elbows last December during a WTO meeting in Singapore to oppose efforts by a group of industrialized nations led by the United States to give the world trade body a say over employment practices including child labor.

India has said it wants the G-15 to press developed economies to open their textiles and agriculture markets. New Delhi also seeks safeguards against anti-dumping measures that keep developing nations' products out of industrialized markets.

Malaysia's Rafidah said the G-15 would unite behind the need to open their economies -- but at their own pace.

Malaysia might bring up a proposal it had earlier put forward but which had been left on the back burner -- a multilateral scheme which would provide guarantees against risks of non- payment in trade, officials said.