Mahathir continues efforts for AMF

Mahathir continues efforts for AMF

BEIJING (AFP): Malaysian Prime Minister Mahathir Mohamad
Thursday continued calls for greater financial and security
cooperation among Asian countries and urged China to join
Malaysian efforts to build a stronger "regional grouping" of East
Asian countries.

In a speech given at the Malaysia-China Forum in Beijing,
Mahathir urged the establishment of an Asian Monetary Fund that
could replace the International Monetary Fund as the first line
of defense in case of economic crises.

"China and Malaysia should examine how together with our
neighbors we can realize the Asian Monetary Fund proposed by
Japan," Mahathir said.

"The unprecedented economic crisis has demonstrated the vital
need for the setting up of a regional fund so that the economies
encountering critical financial problems can turn quickly for
assistance so as to prevent rapid deterioration," he said.

Mahathir, who is on a three-day working visit to China,
earlier Thursday met with Chinese President Jiang Zemin and on
Wednesday held bilateral talks with Premier Zhu Rongji.

His visit marks the 25th anniversary of diplomatic relations
between the two countries.

During his speech he further criticized the "harsh conditions"
of the International Monetary Fund, while saying IMF intervention
in Indonesia was "a classic case to be avoided at all costs."

Mahathir has blamed free market hedge funds and currency
traders for the Asian financial crisis and he again called on the
Asian economies to work toward reforming the international
financial system and regulating currency flows.

Asia also needed to strengthen the "ASEAN plus three (the
Association of Southeast Asian States plus, Japan, South Korea
and China)" forum and build a "regional grouping" which could be
used as a third party to American and Western European economic
and security dominance, he said.