Ramos links IMF to Asian dilemma

Ramos links IMF to Asian dilemma

MANILA (Reuters): The International Monetary Fund's rescue
plan for Indonesia and Thailand may have worsened the two
countries' economic problems, Philippine President Fidel Ramos
said.

Ramos made the statement in an article he wrote for the June
12 issue of Asiaweek news magazine, excerpts of which were
released by the presidential palace yesterday.

The palace news release quoted Ramos as saying the IMF formula
of tight monetary policy for stabilizing an economy "might have
unwittingly worsened Thailand's problem by accelerating the rate
of corporate and banking failures".

"And in Indonesia, the raising of fuel prices required by the
IMF triggered the Jakarta riots that forced President Soeharto to
step down," Ramos said.

He urged multilateral institutions to develop quick-response
mechanisms "to contain a local financial crisis before its
contagion spreads -- and new policy frameworks to replace the
conventional policy tools that have failed to work".

Ramos said it was perhaps time for the Manila-based Asian
Development Bank to define its programs to better suit Asian
countries.

Industrial countries must also take a more active part in
bail-out programs for troubled economies, he said.

"After all, globalization means everybody having an interest
in everyone's continuing economic health."

Ramos also said fund managers should "begin to care for the
social consequences of their investments in developing countries,
where political systems are still so fragile that economic crisis
can break them".

There was also need for more transparency in economic
information.

"Governments should agree to provide accurate and current data
on their basic indicators and those that reflect the health of
their banking sectors," he said.

Ramos spoke of dangers posed by a global market to local
cultures, citing both China and India, which "are trying to
resist -- in the end perhaps vainly -- the inroads of the fast-
food chains of the dominant Western culture".

He added, "In both these great countries -- virtual
civilizations by themselves -- nationalism could still turn
virulent, if their economies should experience a severe
downstream or if their claims to great power status become
frustrated," Ramos said, according to the release.