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GLOBAL
ECONOMIC FOCUS SHIFTS TO ASIA
Contact:
Fon Mathuros, Deputy, Media Relations
Communications Department
Tel.: +65 9342 3068
Fax: +65 6233 5191
E-mail: fmathuro
http://www.weforum.org
Singapore, 28 April 2005
-The World Economic Forum opened its second Asia Roundtable
today in Singapore. Over 250 participants from 34 countries
are gathering together to identify the critical issues
and generate insights necessary to develop the right strategic
response. The theme of the Roundtable is "Tilting
the Global Balance: The Strategic Implications of Asia's
Growth". The Roundtable is being held from 28 to
29 April in cooperation with the Singapore Economic Development
Board (EDB).
One of the key issues discussed
during the opening plenary session was the rise of China
and India as the new economic juggernauts that would outstrip
the US and Europe to drive global growth, and the social
and economic consequences of such a breakneck speed of
growth.
"The rise of China
and the opening up of India is probably the biggest story
this century. China and India are the fastest growing
economies in the world," said Raymond Lim Siang Keat,
Minister in the Prime Minister's Office, Second Minister
for Finance and Second Minister for Foreign Affairs of
Singapore. "Already, China is overtaking the US as
the major trading partner of Japan; some analysts reckon
that in 50 years' time, China will overtake the United
States as the world's largest economy and India will not
be far behind."
Claude R. Béglé,
Chief Executive Officer, GeoPost International Management
& Development Holding, Germany, agreed that Asia would
indeed play a vital role on the world economic stage.
"Before you had basically one tonne of cargo from
Europe towards Asia and vice versa; three years ago it
was a ratio of one to Asia and two from Asia; this year,
it's already one from Europe, three from Asia." He
also highlighted the importance of Japan and India. "Definitely
the centre of gravity of the world is moving towards Asia.
The big question is the relative weight of China and India
versus the traditional giant which is Japan and I think
the shift is good for the world and for Europe."
Lim also said that this
has created an imbalance that has brought about the recognition
within ASEAN countries that integration is crucial. "ASEAN
countries recognize that integration is not a matter of
choice but really a matter of necessity. That an ASEAN
of half a billion people spread over ten fragmented markets
is quite a different proposition from an ASEAN of ten
integrated markets and economies." He added this
has given rise to a common resolve to reduce tariffs,
unify standards and develop a habit of consultation with
neighbour countries. Indeed, during the SARs crisis, Lim
pointed out that we saw an instinctive reaction to coalesce
and deal with issues together. But Lim stressed that this
regionalism is one that is open and inclusive, not insular.
Also discussed was the
issue of bilateral tensions between China and Japan and
the necessity for putting the past aside and recognizing
Japan's important constructive role in the region and
beyond. Ichiro Aisawa, Senior Vice-Minister for Foreign
Affairs of Japan, highlighted the economic importance
of China to Japan and the world. He said that Japan's
trade with China now exceeded the volume of its trade
with the US. "The smooth progress and good bilateral
relationship between Japan and China will be extremely
vital to the continued growth of the global economy and
that incidents that might arise between the two nations
I'm sure can be dealt with successfully " He added
that his vision is for both countries to lead global growth.
Aisawa stressed the need
to leave the past behind while remaining sensitive to
the situation. Jiang Jianqing, Chairman and President,
Industrial and Commercial Bank of China, People's Republic
of China and Co-Chair of the Asia Roundtable 2005, echoed
his sentiments, saying it was important for both countries
to look ahead and resolve their differences amicably.
"As two major countries, if we want to maintain a
stable economy for Asia, the two countries should work
and survive in a very harmonious manner."
Lim also stressed the need
for regional governments to balance the factors to make
this pace of growth sustainable as Asia makes the transition
to becoming the economic centre of the world, a point
that was taken up by Mohamed A. Alabbar, Chairman, Emaar
Properties, United Arab Emirates and Co-Chair of the Asia
Roundtable 2005. "I have no doubt in my mind that
the shift has taken place, the growth potential in the
region is unbelievable but the risk is really the speed
of growth. I'm always worried about energy and natural
resources to supply this unbelievable rate of growth."
Michael Hawker, Chief Executive
Officer and Managing Director, Insurance Australia Group
(IAG), Australia and Co-Chair of the Asia Roundtable 2005,
agreed, stating that the resulting pressures on resources
and social structures and security would be untenable.
"I think we're dealing with not only the speed of
change but the quantum of change. ... the challenge of
the speed is therefore implicated in the global governance
structures ... unless there is an improvement in global
governance structures, then many economies will revert
to protectionist measures to try and slow down the rate
of change."
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