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2009年2月24日 (火)


The Yomiuri Shimbun (Feb. 24, 2009)

Domestic demand key to fixing Asian economy


Affected by the deepening global economic downturn, the Asian economy, which is regarded as the hub of the world's economic growth, has also been slowing down.


Aimed at revitalizing the economies in the region, the finance ministers of the Association of Southeast Asian Nations as well as Japan, China and South Korea pledged to strengthen coordination of economic policies within the region.


The action plan, adopted at the ASEAN plus Three meeting held in Phuket, Thailand, on Sunday, features an expansion of regional currency swap agreements--the system of lending money to countries running short of foreign currency reserves within the Asia region--to up to 120 billion dollars. It also states that a regional monitoring mechanism for each country's economic conditions will be set up.


So far, such currency turmoil as occurred during the 1997-98 Asian financial crisis has not been seen. However, there is some worrying movement in the markets, including a fall in the value of the South Korean won. We must be alert to prevent the recurrence of such a crisis.


It is very significant to facilitate the mechanism to expeditiously tackle such a crisis within Asia, in addition to the assistance measures from the International Monetary Fund. Those involved should swiftly work out the specifics of the mechanism, including the allocation of additional funds by each country.



Cooperation leads to progress

It may be a step forward to realize an Asian monetary fund initiative, an issue over which the nations involved were once deadlocked.


A more serious issue for Asian nations is the abrupt slowdown of the economy. The so-called decoupling theory, which posits that even if the developed countries are in economic slump, the high growth of newly emerging economies will ameliorate the situation, has crumbled.


According to the IMF's forecasts for 2009, growth in the ASEAN member nations will shrink to 2.7 percent. The economies of China and India, which have both continued to see robust growth, are also expected to decelerate, with China's economy expected to grow 6.7 percent and India's by 5.1 percent.


Many countries have been dependent on exports to the United States and other nations and, as a result, have achieved high rates of economic growth. However, such a growth path has collapsed. A new strategy for economic growth, which does not rely on exports, must be formulated.



Economic self-reliance

It is appropriate that China, South Korea and other nations have decided to enact large-scale economic stimulus measures through fiscal and monetary policies. Although it is a difficult task, each nation must hurry to convert to an economy driven by domestic demand.


Once the Asian economy, with its potential for growth, is revitalized, it can be expected to become a leading force in pulling the world economy out of the global recession.


It is also important that the participating nations are firmly against protectionist trade measures and agreed to refrain from introducing new trade barriers. If protectionism prevails, trade will shrink and the recession will deepen. It is vital to contain protectionism within Asia and promote free trade.


Japan failed to make its presence felt during the meeting, as Finance Minister Kaoru Yosano--who also is state minister in charge of financial services and economic and fiscal policy--did not attend the meeting due to Diet deliberations and other reasons.


Japan plays a significant role in the Asian economy. A Cabinet minister should have attended the meeting and shown leadership.


(From The Yomiuri Shimbun, Feb. 24, 2009)

20092240141  読売新聞)


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