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WORLD> Asia-Pacific
ASEAN says coordinating on financial crisis
(China Daily)
Updated: 2009-03-02 07:46

Southeast Asian leaders said Sunday they backed stimulus plans, opposed protectionism and would coordinate policies to confront a deepening global financial crisis battering their economies.

ASEAN says coordinating on financial crisis
ASEAN heads of state and ASEAN Secretary-General Surin Pitsuwan (extreme right) join hands after a signing ceremony of documents in the seaside resort town of Hua Hin, 200 km south of Bangkok, March 1, 2009. [Agencies]

The 10 leaders of the Association of South East Asian Nations (ASEAN) did not spell out any specific actions the group would take in a chairman's statement issued after their summit in the Thai seaside resort of Hua Hin.

They said they endorsed expansionary policies, including fiscal stimulus plans, monetary easing, access to credit and trade financing, and measures to stimulate domestic demand.

Export-dependent Asian economic growth is slowing rapidly as consumers and companies cut back spending amid the worsening global downturn.

In Southeast Asia, Singapore is in recession and economists say Malaysia and Thailand are on the brink, while Indonesian growth has slowed to its weakest pace in more than two years.

Many Asian countries have announced stimulus plans in a bid to stem the economic damage, but exports will not stage a major recovery until consumers in the West start spending again.

The leaders also agreed to stand firm against protectionism and refrain from introducing or raising new trade barriers and called for "bold and urgent reform" of the international financial system, the statement said.

"We will be severely tested from now on, both as a group and as a part of the broader Asia region," Thailand's Prime Minister Abhisit Vejjajiva told the summit opening on Saturday.

"As the financial crisis deepens, the world will look towards our region for action and for confidence."

Roadmap to community

ASEAN has begun, with this summit, implementing a roadmap that will turn what used to be a consensus-based group long derided as a talk-shop into a single economic community of 570 million people with a combined GDP of $2 trillion in six years.

Economic ministers this week agreed to reduce trade barriers and open up some service industries.

The most tangible outcome of the meetings was the signing of a free trade agreement between ASEAN, New Zealand and Australia that could eventually add $48 billion to economies in the region.

In the run-up to the meeting, ASEAN along with China, South Korea and Japan agreed to enlarge their pool of foreign reserves to $120 billion to defend their currencies from the fallout of the financial crisis.

But while ASEAN leaders made a stand against protectionism, they have defended their own buy-local campaigns, saying those conform with trade rules, and are similar to the "Buy American" clause in the $787 billion US stimulus package.

The summit, whose theme this year was "ASEAN Charter for ASEAN Peoples", held talks with civil society groups, part of its drive toward creating an integrated socio-cultural community.

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