*{Creating Regional Stability: Roles for Business and Government [http://www.weforum.org/site/knowledgenavigator.nsf/Content/Creating+Regional+Stability%3A+Roles+for+Business+and+Government?open&topic_id=300250000&theme_id=300]

            13.09.2000

            Asia Pacific Economic Summit 2000}

            Is Asia entering a period of stability or unpredictability? That was the question session moderator Claude Smadja, put to the panellists in opening the session. 

            Ross Garnaut, Professor of Economics, The Australian National University, led off the discussion by pointing out that maintenance of internationally oriented growth is the key to raising the living standards of the poor in East Asia. This, in turn, would provide one element of a favourable environment for building a stable, domestic political order. 

            For this reason, Garnaut believed that an ongoing commitment by Asian countries to an open trading system is essential to secure the stability of the region. Possible threats to multilateral trade liberalization include the plethora of sub-regional trade agreements such as those between Korea and Japan and Singapore and New Zealand, and of allowing a vacuum to remain in the WTO following the failure of the Seattle meeting.

            Garnaut said that there is not much chance of a repetition of the 1997-98 Asian crisis in the foreseeable future. The effects of the crisis appear to have inoculated the current generation of financial leaders against the mindless optimism of the years immediately preceding the downturn. The IMF and national policy agencies also appear to have learned from their mistakes. However, Garnaut warned that there is still a threat of political instability in areas such as the Korean Peninsula and the Taiwan Straits. 

            For Yoshiji Nogami, Vice-Minister for Foreign Affairs, Japan, ignoring the genuine concerns of civil society about the globalization process will be the main threat to regional stability. He believes countries need to develop effective mechanisms for hearing and addressing those concerns to ensure that these mechanisms do not become a significant destabilizing force.

            Alexander Downer, Minister of Foreign Affairs of Australia, supported Garnaut's view that to maintain stability, the region must not retreat from trade liberalization. He said trade barriers guarantee political and economic problems. When pressures are applied to back away from liberalization, Downer said governments need to argue their position more strongly, not change their stance. 

            Other factors that Downer believes contribute to regional stability include greater transparency and accountability in financial and government institutions and the maintenance of strong relationships between Asian countries and the great powers, e.g. the Sino-American agreement.

            Chung Eui-Yong, Deputy Minister for Trade of the Republic of Korea, noted that Asia has been slow to respond to regionalism. North-East Asia, in particular, has been reluctant to enter into regional arrangements because of intense political rivalries in the area. However, he said the crisis has been the wake-up call to greater regional cooperation and, for the first time this year the leaders of China, Korea and Japan are meeting to explore the possibilities.

            Nevertheless, Chung wondered if Asia should pursue regionalism or globalism. "If regionalism is an evolutionary stage on the road to globalism, why not go straight to globalism?" he asked. 

            Nguyen Mahn Cam, Deputy Prime Minister of Vietnam, believes that the early stages of regional cooperation will continue to develop in the 21st century and help to ensure stability in the region.

            In general, the panellists were optimistic about the ongoing stability of the Asian region and felt confident that the area's moves toward economic prosperity and political order would continue into the foreseeable future.                   

                  *{Contributors:       Chung Eui-Yong       Downer Alexander
                  Garnaut Ross
                  Nguyen Manh Cam       Nogami Yoshiji
                  Smadja Claude}