Asian and European leaders are realizing the severity of the financial crisis and trying to rally together to fight the scourge. The Asia-Europe Meeting (ASEM) which opened on 17 Oct 2008 was an attempt to minimize the differences between Asian and European leaders in tackling the crisis. The scale of this meeting is significant as it covers two thirds of world trade and 60 percent of global output.
Southeast Asia also took its opportunity to exchange views with the global powers of EU, Tokyo and Beijing. Consensus amongst the 45 states from different continents is not easy but a united front is needed to cope with the global financial crisis. Even a hint of this unity will help to contribute to restoring confidence in the market.
As the White House braced the US public for a sharp rise in layoffs and unemployment, Southeast Asia and Europe hopes that China and India will step up in the crisis and spur world growth. ASEAN’s European counterparts are also doing their part.
France unveiled plans for a 100-billion-euro (128-billion-dollar) sovereign wealth fund to protect key industries from turmoil. French President Nicolas Sarkozy’s main goal in Beijing was to win Asian support for his ambitious financial reform plans and to completely reshape the global economic structure to replace the Bretton Woods system that has governed international finance since the end of World War II, with the Washington summit to kick off the process.
ASEAN countries had already met with their Northeast Asian counterparts just before the ASEM meeting in the ASEAN Plus Three meeting. More importantly, ASEAN met with Japan, China and South Korea to beef up a regional mechanism for emergency financial support.
Political unity even in the micro sense is important as Thailand and Cambodia attended, despite their sputtering border dispute.
But, analyst say that, despite the multilateral grandeur, it is more likely that the Southeast Asian and East Asian states would continue to rely on quiet and polite bilateral diplomacy to work towards a regional solution. The meeting runs against some pretty gloomy scenarios as outlooks from US, European and Japanese companies are unlikely to give many grounds for optimism.
But the urgency of such multilateral summits and coordinated actions is increasing by the day as already Ukraine, Belarus and Pakistan have appealed for assistance from the IMF.
The world needs all the unity it can get.
AFP, “Stock markets in free fall on gathering global gloom” dated 24 Oct 2008 in Singapore Yahoo website [downloaded on 27 Oct 2008], available athttp://sg.news.yahoo.com/afp/20081024/tts-stocks-world-c1b2fc3.html
AFP, "World recession fears mount" dated 26 Oct 2008 in the Yahoo news website [downloaded on 27 Oct 2008], available athttp://sg.news.yahoo.com/afp/20081026/tts-finance-economy-world-c1b2fc3....
Buckley, Chris, “Asia, EU wrestle crisis in messy diplomatic dance” dated 22 Oct 2008 [downloaded on 27 Oct 2008], available athttp://news.yahoo.com/s/nm/20081022/ts_nm/us_asia_europe_1