Despite indication that most Asian economies are in the upswing after a two-year paralysis, lawmakers from the region believe a lot of work still needs to be done to ensure financial security for countries heavily battered by the crisis.
They also believe security concerns must be addressed by nations working together, particularly in regional flashpoints that may harm efforts toward economic stability and continued development in the Asia Pacific.
Legislators belonging to the Asian-Pacific Parliamentarians’ Union (APPU) voiced out economic and security concerns yesterday at its 65th Council Meeting being hosted by the Northern Marianas.
The three-day conference ends today when members sign a joint communiqué at the Tinian Dynasty Hotel and Casino which is expected to make strong statement on these regional issues as well as on proposal to amend the group’s charter in an obvious response to the sign of the times.
Yoshinori Ono, Japan’s chief delegate to the APPU meeting, underscored the difficulties by some countries to regain lost grounds following the financial turmoil that swept much of East Asia like a domino in 1997.
“Now, two years after the crisis arose, we are still feeling the effects of the severe circumstances of negative growth,” he told in his speech. “Some signs of a brighter future are now in evidence, however, such as stability in exchange rates and falling interest rates.”
According to Ono, Tokyo is actively pursuing efforts to stabilize the currencies and economies of the Asia Pacific in a bid to boost Japan’s economy, the world’s second largest after the United States.
So far, Japan has pledged to provide up to $80 billion in financial assistance to the region as well as support funds amounting to $30 billion to deal with the crisis.
“We must achieve financial security and peace by applying our wisdom and efforts in order to implement cooperative joint efforts by the people of Asia in every field,” Ono told APPU delegates.
Arms race is a serious concern: While economic growth has been its utmost priority, he said Tokyo is also concerned over the continued arms build-up by North Korea, which has remained a serious threat to regional peace.
Suh Chung Hwa, head of Seoul’s delegation, echoed the need to strengthen ties with their neighboring country to enhance stability in the Korean peninsula.
Alarmed by the series of nuclear tests and the development of missiles in some parts of the region, he said these will only heighten tension and provoke arms race in Asia-Pacific.
“Therefore, both regionally and internationally we need to devise strong response measures against such situation,” Suh said, adding that his government has adopted international agreements against nuclear weapons.
On the economic front, the South Korean legislator called for a tight watch on capital markets as well as development of a financial system that can reduce and possibly eliminate the risks of rapid capital flight.
“We have come to realize that, in some cases, just one place of straw is enough to break the back of our enormous but unstable financial markets,” Suh explained. “With decades of economic development going up in thin air, not only the well-being of a single country, but the prosperity and co-existence of the whole world will be put in jeopardy.”
There has been widespread belief among Asian leaders that the currency crunch was caused by money speculators from the Western world.
Thailand was the first to suffer from the meltdown in July 1997 that quickly spread to other countries, toppling Korea’s once robust economy, the seventh largest in the world and sending Japan to its worst crisis since World War Two.
Controls need to be put in place: To prevent occurrence of similar situation, Malaysia has implemented sweeping reforms in its financial sector — a move that has drawn controversy in recent months.
These controls are intended to tighten access by speculators to its currency and to stabilize short-term capital inflows, according to Datukwira Abu Seman Yusop, Malaysia’s chief delegate.
While these selective measures are working for his country, Yusop believed more concerted efforts are needed in the region to resolve the root cause of its economic troubles.
“We believe that in any approach to reform the international financial system has to begin with more transparency in foreign exchange trading. This includes transparency on the part of currency traders, hedge fund managers as well as bank dealing with currency trading,” he told APPU.
Taiwan, meanwhile, called for regional economic cooperation and assistance to assist countries in coping with the aftermath of the crisis, saying its proposal for a development fund is a first step to deal with sudden eruption of “financial shock wave” in the region.
Called the Common Development Fund for Asia , the plan has met lukewarm response from other countries when the Taiwanese government offered the idea at the height of the crisis.
Ching-chun Chiu, its delegate to the Saipan meeting, told APPU members that the proposal needs a second look now that some countries have started to experience recovery.
“We have to mull over more fully the idea of instituting the Common Development Fund and question ourselves concerning the necessity and urgency of establishing such an ability and mechanism within our region,” he said.
Pacific islands air economic concerns: Member countries from the Pacific also joined the forum that tackled the present economic and security problems in the region.
Palau House Speaker Ignacio Anastacio said the crisis in Asia has forced the country to diversify its tourism-based economy and look towards developing its agriculture and fishing industries.
Sen. Wilfred Kendall from Marshalls emphasized efforts by smaller nations to cope with the economic problems, saying they are trying to draw lessons from the experience of other Asian countries.
“Hopefully small developing nations can learn from the example of the Asian financial crisis to help achieve a strong and thriving economies,” he said.