SE Asia must 'rely less on rich states'

SE Asia must 'rely less on rich states'

KUALA LUMPUR (Reuters): Southeast Asia should rely less on rich countries or "charity" bailouts by financial institutions and instead raise funds at home, Malaysian Prime Minister Mahathir Mohamad said yesterday.

Mahathir told a conference that he believed mobilization of financial resources from within the region should be the first step towards self-reliance and "gaining dignity".

"The indifference of the rich countries to our economic situation should motivate us enough to take the initiative in looking into the potential of this region for alternative paths to sustainable progress," Mahathir said.

"This is more appropriate than relying on multilateral and bilateral donors," he said when opening an international women's conference on poverty eradication.

The prime minister recently said his country will not ask for any foreign help to recover from its economic crisis. Foreign investors have fled Malaysia's currency and stock markets in the past several months as the contagion from Thailand's economic troubles spread to the region.

Thailand and the Philippines have recently received financial aid from the International Monetary Fund (IMF) and Indonesia is seeking assistance from the body.

Mahathir criticized the IMF's aid package for Thailand, saying the servicing of the debt would be more of a burden than help to Bangkok.

He also accused international financial institutions of serving big financial institutions and foundations "in the guise of assisting the poorest".

"They undermine micro finance by perpetuating the mentality of charity to these financially viable institutions," he said.

Last week, Malaysian Deputy Prime Minister and Finance Minister Anwar Ibrahim said an ASEAN-proposed fund to assist troubled Asian economies with the help of Japan would need $100 billion.

But he said the fund would only be for countries that had fallen into trouble accidentally. "Those who have created their own economic fiasco cannot be beneficiaries of this fund," he said.

The IMF and United States are wary of the concept and Germany is strongly opposed, fearing a regional facility would disperse funds without demanding the strict -- some Asians say too strict