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Kuala Lumpur, Malaysia
18 November 1998
Datuk Seri Dr. Mahathir bin Mohamad, Prime
Minister of Malaysia,
Fellow Colleagues,
It is a real pleasure for me to meet you
again, my colleagues, in this beautiful city of Kuala Lumpur.
I wish to thank our host the Malaysian Government for its
thoughtful arrangement. I would also like to take this opportunity
to warmly welcome our three colleagues from Russia, Peru and
Viet Nam, who have joined us at the meeting for the first
time.
At the Vancouver meeting last year, the
financial crisis in some Asian countries aroused wide concerns
among APEC members. Now a year has passed but its ramification
is still spreading out, not only bringing serious economic
difficulties to some countries and regions in Asia, but also
affecting the world economy as a whole.
This crisis has occurred against the international
background of accelerated economic globalization, and it has
given the world people important revelations.
Economic globalization has become a trend
as a result of the economic, scientific and technological
development in the present-day world. It has brought to countries
in the world not only development opportunities, but also
serious challenges and risks. It has also presented to countries,
developing ones in particular, a new subject to tackle, that
is how to ensure the economic security of a country.
The trend of economic globalization requires
active participation by all countries in international economic
cooperation. However, countries should expand their opening-up
programme in the light of their national conditions and in
a step by step manner while paying attention to increasing
their capabilities of preventing and withstanding risks.
The trend of economic globalization has
made the economies of countries more and more interdependent
and interactive. Once a financial crisis breaks out in certain
countries or regions, not only developing countries will suffer
immensely from it, but developed ones will also find it hard
to stay out of it. A globalized economy calls for global cooperation.
All members of the international community should work together
to maintain a steady development of the world economy in a
spirit of sharing responsibilities and risks.
The trend of economic globalization is
emerging and developing in a context where there is no fundamental
change in the inequitable and irrational old international
economic order, which will inevitably widen the gap between
the poor and the rich countries. The ultimate solution to
this problem is to work for the establishment of a fair and
reasonable new international economic order in the interest
of the common development of all countries.
At the moment, the international community
has a common concern about how to curb the ramification of
the financial crisis at an early date and prevent a worldwide
economic recession. In order to promote steady development
of the international financial sector and the establishment
of a new international financial order, I would like to put
forward three proposals:
I. To strengthen international cooperation,
prevent the spread of the crisis and create a favourable external
environment for the economic recovery and growth of the crisis-stricken
countries and regions. The developed countries should adopt
a responsible attitude to stimulate economic growth, boost
domestic demand and expand import by means of fiscal and monetary
policies, and refrain from resorting to trade protectionism.
At the same time, they should increase financial assistance
to the crisis-stricken countries and make proper arrangements
to reduce their debt burdens in an effort to help them stabilize
the finances and recover the economy. In this way, they will
not only help these countries tide over the difficulties,
but also serve their own interests.
II. To restructure and improve the international
financial system and ensure a safe and orderly operation of
the international financial market. Those big powers with
influence in international finances are duty-bound to take
effective measures to improve the supervision and regulation
of the flow of the international financial capital, contain
over speculation of the international hot money, and enhance
the capability for the forecast and prevention of financial
risks and for their relief. It is essential to deliberate
the establishment of a new international financial order which
conforms to the interests of all sides, through dialogue and
consultation between developed and developing countries in
compliance with the principle of equality and mutual benefit
and on the basis of extensive participation by the international
community. I agree that the APEC Finance Ministers' Meeting
should study the questions related to the restructuring of
the international financial system and put forward relevant
proposals.
III. To respect the independent choices
made by any countries or regions on overcoming the crisis.
The crisis stricken and affected countries and regions differ
in the level of economic development and historical tradition,
and also in the cause and impact of the crisis. Therefore,
there is no, and can not be, a fixed model or a single remedy
for them all to tide over the crisis and revitalize the economy.
Instead, they should be given support in taking measures in
the light of their own situation. The international community
and organizations should respect the right of a country to
make decisions on its own, and help it lift itself out of
the difficulties as soon as possible through consultation
on an equal footing. Developing countries, the crisis stricken
or affected countries and regions in particular, should make
necessary readjustment of their economic structure and policies
in the light of their own conditions, properly handle the
prominent problems in their economic development, and increase
economic dynamism by taking full advantage of the favourable
conditions, both internal and external.
The financial crisis has also brought
negative effect and great pressure on the economic development
in China. The Chinese Government has assumed a highly responsible
attitude. China has provided assistance to the relevant countries
within the framework of the IMF arrangements and through bilateral
channels. Proceeding from the overall interests of maintaining
sustained economic growth and international economic development,
China has made the decision of not devaluating the RMB, for
which China has paid a high price. Having won a battle against
the catastrophic floods this summer, we are now going ahead
with more in-depth reforms, adopting active fiscal policies,
increasing input for infrastructural construction, and boosting
domestic demand in an effort to achieve this year's objective
of economic and social development.
APEC, as the most important international
economic organization in this region, must adapt to the new
situation, persist in narrowing the gap and realizing the
objective of common prosperity through economic cooperation
and make timely readjustment of the priority areas for cooperation
so as to better meet the needs of the developing members,
who make up the majority of the membership. At present, it
is more important than ever to stick to the APEC Approach
characterized mainly by respect for diversity, voluntarism
and consensus. APEC should make its own contribution to increased
regional stability and prosperity by adhering to this approach.
Promoting economic and technical cooperation
(Ecotech) among its members is a major task of APEC and a
primary way to common development. In the world of today,
science and technology are progressing with each passing day,
and the knowledge economy is unfolding. To redouble the efforts
to develop high and new technology and speed up the economic
restructuring are the only way to promote a long-term and
steady development of the economies of APEC members. We are
glad to see the formulation by APEC of the APEC Agenda for
Science and Technology Industry Cooperation into the 21st
Century and Skills Development Action Plan this year under
the chairmanship of Malaysia the host country. They represent
a major step by APEC members towards enhanced Ecotech. China
attaches importance to and supports the implementation of
these two important documents. As an expression of this, the
Chinese Government has set aside US$ 10 million to establish
the China APEC Science and Technology Industry Cooperation
Fund for the purpose of financing cooperation between China
and other APEC members in the field of science and technology
industry, and has put forward a series of proposals on cooperation
projects. China has also set up a China APEC Enterprises Assembly
to promote enterprise participation in APEC activities.
Promoting trade and investment liberalization
is another important task of APEC. Thanks to the concerted
efforts of all members, positive progress has been made and
will continue to be made in this area. In the current circumstances,
it is important to pursue an active and prudent policy, and
its members should be allowed to make efforts towards the
realization of the goal-trade and investment liberalization-at
a pace and in a mode suitable to their own conditions and
in accordance with the two timetables on the basis of voluntarism,
flexibility and pragmatism.
The current difficulties facing some Asia-Pacific
countries and regions are temporary ones. I believe that there
is huge economic vitality and development potentiality in
the Asia-Pacific region. So long as we work together to increase
cooperation and surmount difficulties, the economic and social
development in this region will have a broad and bright prospect.
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