Partial text of ASEM statement on Asian economic crisis
Partial text of ASEM statement on Asian economic crisis
LONDON (Reuters): Following is a partial text of a statement
on the financial and economic situation in Asia issued at the
Asia-Europe summit last Friday:
1. Leaders discussed the recent financial and economic
situation in Asia, emphasizing its impact on the global economy
and stressing their concern about the human cost to the people of
Asia. They reaffirmed the need to respond decisively to the
crisis and welcomed the reforms being undertaken by the Asian
countries concerned to promote financial and economic stability.
They expressed confidence that with full implementation of the
necessary policy reforms and strong mutual support, financial
stability would be restored. Strong economic fundamentals would
enable Asia's impressive growth performance to continue over the
medium term.
2. Leaders agreed that it was important to reinforce the role
of the IMF at the center of the global response to what is a
global concern. They expressed their strong support for full
implementation of the programs of reform agreed with the IMF, the
World Bank and the ADB, which would be vital in restoring
confidence in Asian economies and financial markets. They
appreciated and encouraged the adjustment efforts in the Asian
countries concerned. They emphasized that policies should be
implemented in an open, transparent and non-discriminatory
manner.
3. Leaders welcomed the timely response to date to the crisis
from the international community...
4. Leaders discussed ways, including those contained in the
Manila Framework, in which the international monetary and
financial system could be reformed and strengthened, focussing on
crisis prevention and reducing the vulnerability of domestic
financial systems to potential shocks, including speculation-
induced instability. They called for:
* a strengthened capacity of the IMF to respond to financial
difficulties in a timely and decisive manner, and access to
expanded levels of IMF resources through a quota increase and
early ratification of the New Arrangements to Borrow (NAB);
* enhanced and more transparent global IMF surveillance,
complemented in Asia by the establishment of a new regional
surveillance mechanism;
* strengthened cooperation, regulation and supervision in
financial sectors, and an examination by the IMF and
international regulators' bodies of ways to improve transparency
in financial and capital markets, including the possibility of
monitoring short-term capital flows.
5. Leaders stressed the importance of devising strategies to
secure private sector involvement in providing financial
assistance as necessary and appropriate, in cooperation with and
supporting the approach of the public sector...
6. Leaders recognized the importance of continued access to
trade finance for economic recovery within the framework set by
the IMF...
7. Leaders agreed that cooperation through ASEM on technical
assistance could play a major role in support of the programs of
reform agreed with the international financial institutions...
8. In addition to existing bilateral arrangements, Leaders
welcomed the proposal to create a European network, associating
Asian expertise, for increasing the quality and quantity of
technical advice in reforming the financial sector...
9. Leaders noted the particular importance of strengthening
and reforming domestic financial systems and economic structures
including corporate sectors in order to realize Asia's underlying
potential and achieve sustained economic development. They also
noted that Asian efforts to undertake the necessary reforms in
the financial sector could play a decisive role in restoring
investors' confidence by ensuring transparency, predictability
and proper surveillance...
10. Leaders recognized the need to consider the social impact
of the financial difficulties in Asia. They noted that
implementing comprehensive reform programs offered the
opportunity to build a strong platform for sustainable future
growth. But in doing so, it would be important to protect social
expenditure wherever possible, and develop well-designed and
affordable social safety nets to safeguard the poor.
11. Aware of the importance of complementarity between
economic and social policies, they agreed to adopt a balanced
approach in addressing the socio-economic impact...
12. Leaders also considered the impact of Asia's current
difficulties on the world economy. They noted that with continued
implementation of sound economic and financial policies, the
overall impact on the world economy was likely to be material but
manageable. There were already signs of substantial improvements
in the external accounts of some Asian countries, but the
difficulties were not yet over and the need for vigilance
remained.
13. While expressing confidence about the prospects for
recovery in Asia, all ASEM partners recognized the need to take
appropriate measures to strengthen consumer and business
confidence in order to overcome the crisis. It was also important
more than ever for global economic stability for the European
countries to keep their own economies in good order.
14. Leaders acknowledged that the crisis could trigger
protectionist reactions as a result of shifts in trade and
investment flows or of requirements for adjustment. They
expressed their common resolve to resist any protectionist
pressures and at least to maintain the current level of market
access while pursuing further multilateral liberalization, which
was recognized as the most effective means of overcoming
protectionist pressures and helping to alleviate the crisis...
15. Leaders also acknowledged the vital contribution of
economic reform programs, including reforms in the financial
sector in Asia, to global efforts to resist protectionism,
stimulate investment and strengthen the international trading
system.
16. They noted that developments in Asian markets could lead
to a drop in investments in both directions and pledged to do
their best to facilitate the maintenance and expansion of FDI...