Oleh/By : DATO' SERI DR. MAHATHIR BIN MOHAMAD
Tempat/Venue : THE KUALA LUMPUR HILTON
Tarikh/Date : 13/03/87
Tajuk/Title : OPENING OF THE FIRST ASEAN
ECONOMIC CONGRESS
Honourable Ministers;
Excellencies;
Distinguished Delegates;
Ladies and Gentlemen.
I am very pleased to be here this morning to address
this First ASEAN Economic Congress organized by the Group of
Fourteen. I would like to extend a warm welcome to all
participants to Malaysia and wish them every success in
their deliberations. I am glad to note the presence of so
many prominent business and political leaders not only from
ASEAN but also from many other parts of the world including
Europe, Australia and New Zealand.
2. It is gratifying to note the part played by the EEC
Commission, the Governments of Australia and New Zealand and
by ASEAN's friends from the EFTA countries in this
examination of the ASEAN economic experience. Their
knowledge of regional and neighbourly cooperation will
enable them to suggest to the Congress the best approaches
for achieving economic cooperation among ASEAN countries.
Ladies and Gentlemen,
3. You will agree with me that in its first twenty years
the main thrust of ASEAN has been political. This is as it
should be and we have no need for regrets. We should
remember that it was political problems between us as
neighbours that first brought us together. If I may say so,
we have been kept separate by our former colonial masters
(except for Thailand) so much so that we really knew nothing
of each other and were only too ready to mistrust one
another. But the resulting political problems forced us to
negotiate and eventually to appreciate the futility of
confrontation. We then formed the ASA and eventually ASEAN.
4. But when ASEAN was formed, the EEC was in its early
idealistic years. Invariably a lot of people, particularly
outsiders, saw in ASEAN a mirror image of the EEC -- an
economic community. They dismissed the importance of
regional political cooperation and began talking of common
markets. Foreign investors and traders saw ASEAN as a huge
market, access to which can be gained through one or two
countries they think they could handle.
5. The reality is that we are separate nations with the
interest of our own people at heart. We were not about to
discard our new-found nationalism in favour of unclear
regional loyalties. Although some of us were enamoured of
the common market idea, most found themselves quite unable
to dismantle policies and systems based on nationalism.
After all the EEC then and even now is not such a resounding
success.
6. But the decision to cooperate politically and to
resolve problems among neighbours through negotiation is not
totally without economic benefits. None of the ASEAN
countries would have developed economically if their
political wranglings could not be resolved. Imagine what
would happen to the economies of Malaysia and Indonesia if
"konfrontasi" had continued and escalated. Imagine the money
that would be lost, the tensions and the poor investment
climate that would result if the Philippines' claim to Sabah
had resulted in a face-off between Malaysia and the
Philippines.
7. The decision to cooperate politically not only marked
the maturity of the early ASEAN leaders but quite definitely
laid the foundation for economic developments of the
members. Although we do compete, we also learnt a lot from
each other about how to manage a developing country with a
market economy and dependent largely on the export of
commodities. Such was the success of the ASEAN countries
economically that together they became a show-piece of
regional cooperation and development. It is a truism to say
that no other regional grouping has done as well
economically, and of course politically, as ASEAN.
8. But we musn't pat our backs too much. We have done
well but we must realise that in the modern world's economy
those who don't move forward will soon find themselves left
very far behind. We have to run merely to maintain our
position in the economic pecking order.
9. The economy of the world has changed tremendously since
ASEAN was formed. For us the most telling of these changes
is the collapse of commodity prices and the forced
depreciation of our national currencies. As a result we are
not only earning less from our commodity exports but we have
to pay more for necessary manufactured goods as well as to
service our debts.
10. It is axiomatic that one person's loss is another
person's gain. The losses suffered by the commodity
producers like ASEAN and the OPEC countries meant definite
gains by the developed countries. Indeed it is estimated
that the developed countries received a gift of something
like 100 billion U.S. dollars from the poor developing
countries in 1986 alone. Consequently their economy has
grown by about three per cent, which is extremely high by
the standards of developed countries.
11. But that is not all. A protectionist trend has
developed directed largely at Japan. Unfortunately many
developing countries are caught by protectionist laws and
will suffer losses in export earnings.
12. In addition trade in goods has given way to trading in
currencies and shares. There is more fast money to be made
in buying and selling of money and shares than in the
manufacture and sale of goods. Raw materials are not
involved in this kind of business and again the developing
countries will lose out.
13. In the face of all these radical changes, what do we
do? Commodities may recover, as indeed some have, but they
will never be as valuable as export earners as before. We
may take the route taken by the NIC's -- Korea, Taiwan and
Hong Kong -- i.e. we manufacture goods for exports. They
are extremely well-off now. We may also take advantage of
the expensive Yen -- and become the manufacturing centres
for Japanese enterprises which can no longer manufacture
economically in Japan.
14. All these routes are worth trying and will no doubt
help our economies. The danger is that when our exports of
manufactured goods go up we may be forced to revalue our
currencies as Japan has been forced to.
Ladies and Gentlemen,
15. What else is there left for us to do? As a regional
grouping we must try to find some economic advantage from
working together. There is really no need to give up our
national aspirations completely. But we must realise that
truly "National Products" are now passe. Most manufactured
goods are now assembled from components made in many
different countries. Even Japanese products are not wholly
manufactured in Japan. With the rising Yen the foreign
contents are going to increase. "Made in Japan" may soon
mean only assembled in Japan. In fact the only thing
Japanese about Japanese goods may even be the involvement of
Japanese companies in sourcing the components world-wide and
assembling them in factories located in the countries where
the goods are to be sold.
16. With the expansion in science and technology no one
country can hope to do everything itself. Even the most
technologically advanced countries possessing the biggest
market must buy certain manufactured items from other
countries. No one can surpass the U.S. in making
sophisticated commercial aircrafts but Americans must
import electronic goods and appliances. Without governments
determining policies a kind of division of labour has taken
place in the manufacturing world. That division must extend
to the developing world -- which must be allowed to
manufacture the kind of goods they are most likely to be
efficient at.
17. We must not therefore be too concerned about or take
too much pride in "National Products." Nor should we try to
manufacture everything ourselves. If we want to sell, we
must also be prepared to buy. International trade is not a
one-way thing. In a regional grouping, the only way to
extract economic benefit is to give and take, or sell and
buy or in one word, cooperate.
Ladies and Gentlemen,
18. The survival and prosperity of ASEAN depend on the
willingness of member countries to cooperate beyond current
individual economic considerations. The need for greater
regional cooperation must be considered at par with those
related to national development so long as they do not have
adverse implications. But ASEAN must give priority to
regional considerations. Intra-ASEAN trade, for instance,
must be radically improved and the current PTA, which now
has a staggering 18,000 items, should include items that
give substance and meaning to the concept of preferential
trading.
19. There is, I presume, a consensus on the need to enhance
intra-ASEAN trade. The logical follow-up is to enlarge the
opportunities for trade. ASEAN as a group has a common
stand in efforts to enlarge its market share in the
developed countries of our Dialogue partners. Similarly,
ASEAN could create the opportunity for greater intra-ASEAN
trade by opening its market for products from member
countries. Perhaps it is time for ASEAN member countries to
state what each is willing to do to create the opportunity.
While understandably, national interest will have to be
safeguarded, it should be tempered with the realisation that
regional gains also contribute towards national growth.
Ladies and Gentlemen,
20. ASEAN countries must take the initiative to establish a
closer, more constructive and complementary relationship.
They must not wait too long to assess and decide on
necessary adjustments in facing the international economic
situation. Substantive steps must be taken in regional
cooperation and improvements must be made to the existing
framework of intra-ASEAN cooperation. While ASEAN hopes for
the best possible future, it must prepare for the continuing
deterioration of international economic conditions and the
obstacles and challenges ahead.
Ladies and Gentlemen,
21. Once again I wish you a fruitful deliberation and with
these words I now have much pleasure in declaring open this
First ASEAN Economic Congress.
Thank you.
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