Japan's rescue fund 'too slow'

Japan's rescue fund 'too slow'

TOKYO (AFP): Japan's US$30 billion Asian rescue package is so
slow-footed the crisis will be over before it is spent, Malaysian
Premier Mahathir Mohamad said in an interview published here on
Wednesday.

The package is "very effective" for Asian countries, Mahathir
told the Mainichi newspaper. "But it has to be dispersed in
time," he warned, complaining about slowness and excessive red
tape.

Japan's Finance Minister Kiichi Miyazawa last October
announced the $30 billion loan facility to help Asian nations
recover from the crisis that has swept the region since July
1997.

"Malaysia asked for $5 billion (from the Japanese fund) for
infrastructure projects but we have to go through study after
study, time and time again," Mahathir complained.

"By the time Malaysia eventually gets to see the money, the
crisis will be over. Japan has to think about the effectiveness
of its money."

A Japanese finance ministry official said the government could
not "just hand out the money without having a detailed plan from
each country on how it will proceed with economic
reconstruction."

"We decided to give the money in order to help Asia
economically, and countries must present us a clear, detailed
plan on how they are going to use the money for the economic
improvement," the official said.

Mahathir said Japan's must take a lead in shaping a new world
order.

Tokyo's former proposal for an Asian Fund to work alongside
the International Monetary Fund was "very good," said Mahathir,
criticizing the United States for helping shoot down the idea for
fear it would undermine the IMF.

"The IMF does not understand the situation" in Asia, he said.
"Destroying an economy has social and political costs. The IMF
only looks at financial aspects."

The premier urged Japan to stabilize the yen to allow it to
become an international currency for Asian countries. "It would
be good to have the yen trade in a narrow band," he said, urging
talks with European nations on the subject following their launch
of the euro.

Although Mahathir did not expect a single Asian currency to
emerge in the immediate future, "it will come eventually. I know
that China is not confident enough to open its currency market
but China would have to eventually become involved in an Asian
common currency."

The Malaysian leader said Japan needed more political
stability to overcome its economic woes.

"Japan's constant changes of prime minister makes it difficult
to take action on policies or develop strategies to improve the
economy," said Mahathir, in power since 1981 and Southeast Asia's
longest-serving leader.

"If Japan keeps changing its prime minister every two years it
cannot see any results," he said. "Japan doesn't have a stable
government because everyone wants to be prime minister."

Mahathir, whose country hosted the Asia Pacific Economic
Cooperation (APEC) leaders' forum in November, blasted the United
States for using the grouping to "expand its domination over the
Asia-Pacific region."

He complained that his own proposals to regulate hedge funds
had merely been passed on to the Group of 22 nations for further
discussions.

"APEC is now just a place to meet each other," said Mahathir.
"APEC has no clout."