SE Asia's aerospace industry to soar: Mahathir

SE Asia's aerospace industry to soar: Mahathir

LANGKAWI, Malaysia (AFP): Malaysian Premier Mahathir Mohamad
opened an international air show yesterday and expressed optimism
that the region's aerospace industry will expand on the back of
the economic crisis.

"Withour doubt, the aerospace industry in this part of the
world will be growing at the same accelerated rates as was the
economy prior to July," he said at the Langkawi International
Maritime and Aerospace Exhibition (LIMA) '97 in Malaysia's
northern resort island of Langkawi.

Some 900 exhibitors from around the world are taking part in
LIMA '97 which will focus on the maritime sector.

A total of 42 surface ships and four submarines will be on
display, including the French Agosta-class submarine, along with
60 aircraft.

Mahathir said many countries in Southeast Asia were now
producing small planes and components for big commercial
aircraft, adding that offset programs had contributed much
towards this development.

He said Asia-Pacific demand for aircraft was estimated at
3,750 out of the 15,000 world total requirement by 2014,
equivalent to US$400 billion in value.

"It is therefore not surprising that of late aircraft
manufacturers have been concentrating their marketing efforts in
this part of the world.

"Clearly exciting things are happening which a currency crisis
is not going to dampen too much but generate a lot of business
for the aerospace and maritime exhibition," the prime minister
said.

Mahathir said with the fall in currency values, the region
would become more attractive for the cheaper production of high
quality components. Some Asia-Pacific countries were actively
negotiating joint ventures to produce regional jets and other
commercial aircraft, he said.

Show organizers have said the economic crisis had led to the
withdrawal of seven companies including five foreign firms -- two
from the United States and one each from Belgium, Russia and
Australia.

Megat Nawawi Megat Hamid, senior manager of organizer Le
Proton, said seven other companies had reduced their exhibition
spaces while two Russian companies had cut the number of aircraft
at the show.

Mahathir said regional currency falls had reduced purchasing
power but "everyone is convinced that the present problem is
temporary."

"One way or another the spending capacity will return and will
grow."

Mahathir said that in the last decade, the Asia-Pacific region
had emerged as the fastest growing in terms of economic
performance and world trade.

"With almost two billion diligent and skillful people in North
East and Southeast Asia, their needs even at the time of recovery
will be huge."

Mahathir dismissed talk of an arms race in the region. "There
is no arms race in this region but the fact remains that old
equipment needs to be replaced with more modern ones."