Mahathir urges China to back East Asia Fund proposal
Mahathir urges China to back East Asia Fund proposal
KUALA LUMPUR (Dow Jones): Prime Minister Mahathir Mohamad
Monday resumed his call on China and other regional countries to
back a proposal for an East Asia Fund, the national Bernama news
agency reported.
The proposed fund will compliment efforts to increase economic
cooperation in the region, Mahathir said.
He said the recent Asian financial crisis has demonstrated the
need for such a fund to overcome shortcomings in the
international financial system.
In the past Mahathir has frequently blamed currency
speculators and hedge fund managers who, he said, had been
largely responsible for starting the crisis by abruptly
withdrawing large amounts of short-term funds, triggering
regional financial instability.
Meanwhile, Mahathir also called on China to support the
establishment of a proposed East Asia economic forum, an idea he
mooted in 1990, to voice the region's positions on global
economic and political issues.
China has expressed support for the forum in the past but has
yet to formally say if it will join the grouping.
The United States, Australia and other nations not invited to
join the proposed forum, often referred to as the East Asian
Economic Caucus, say it could be divisive and interfere with a
wider regional grouping, the Asia Pacific Economic Cooperation
forum, or APEC, which Washington backs.
The members of the Association of Southeast Asian Nations, or
ASEAN - Brunei, Indonesia, Malaysia, the Philippines, Singapore,
Thailand, Myanmar, Laos, Cambodia and Vietnam - generally support
the EAEC concept.
Mahathir believes the region needs united clout in
international forums which address trade, economic and political
issues. ASEAN, although an up-and-coming economic group, does not
have the economic clout of Japan and South Korea or the power
status of China to get its views heard.
Japan has been hesitant to express public support for the
forum, partly because of its close ties with Washington, while
South Korea has not formally said whether it would join the
grouping.
Separately, Mahathir announced that Malaysia's central bank,
Bank Negara Malaysia and the People's Bank of China have signed a
memorandum of understanding to expand banking transactions
between both countries.
He didn't elaborate on the banking agreement, only saying the
deal would facilitate increasing trade and investments between
the two countries.
Mahathir was speaking at a dinner Monday to honor Chinese
Prime Minister Zhu Rongji who is on a five-day official visit to
Malaysia.