Multilateral institutions lack responses to Asian crisis

Multilateral institutions lack responses to Asian crisis

SINGAPORE (AFP): Appropriate policy responses to Asia's
economic woes by multilateral institutions such as the
International Monetary Fund (IMF) and the Association of
Southeast Asian Nations (ASEAN) have been inadequate, a survey
among expatriates in 12 Asian countries revealed.

"The IMF has come in for the most flack," with the main
criticism "that it failed to take into account the social impact
of its rescue programs and wound up causing undue hardship for
the people of the countries it is trying to help," said the
independent think-tank Political and Economic Risk Consultancy in
a report received over the weekend.

Expatriates from Malaysia, where the government has been the
most vocal in expressing its views about the role of multilateral
institutions in the region, gave the IMF a low rating of eight on
a scale of zero to 10 with 10 being the worst possible score.

To Malaysian Prime Minister Mahathir Mohamad, "the IMF was
working in the interests of the West, which wanted to bring the
country to its knees in the guise of economic reform. Following
IMF dictates would therefore be tantamount to economic suicide,"
the report said.

However the IMF received favorable marks in countries such as
South Korea and Thailand where its help was most needed, as well
as in Hong Kong and Singapore "where market-oriented policies and
more open financial systems of a type advocated by the Fund have
long been in place and appreciated."

In Indonesia, a multi-billion dollar beneficiary of IMF aid,
the IMF's bargaining power "is probably set to decline even
further," the report said.

It noted that foreign aid donors to Indonesia "have been
dealing with a government that is not really in control of the
country," and that detailed letters of intent between the IMF and
Jakarta "are often left unfulfilled."

Another financial institution, the Asian Development Bank, was
rated on average, a 5.72, only slightly more harshly than the
IMF's 5.62 average rating.

"That is mainly because it has been more of a follower than a
leader in the crisis," and reflected the politics of Tokyo, which
has been much less aggressive than Washington in trying to
influence developments in the region, the report said.

In the same survey, ASEAN rated an average of 7.04, with
expatriates from Malaysia and the Philippines giving it very poor
marks for its policy responses to the regional economic crisis.