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Its economic fundamentals are positive, he points out
SOUTH-EAST Asia's economic fundamentals remain positive compared to the other emerging markets and it remains a good bet for investors, Deputy Prime Minister Lee Hsien Long said at an annual meet in Davos on Friday.
"The economic fundamentals of South-east Asia remain positive, especially compared to other emerging economies," he told delegates at the World Economic Forum.
"It has a sizeable market of 500 million people, a skilful and educated workforce and good infrastructure".
"For investors who want to spread their bets, South-east Asia is a clear diversification play," Mr Lee said.
He said the region's future lies in maintaining open, outward-looking economic policies and staying plugged into the global economy.
He urged countries here to strengthen their links with major trading partners.
While expanding its external trade wings, South-east Asia must also integrate its diverse economies by expanding a free trade zone which eliminates tariffs on manufactured products and components, he added.
This should include liberalisation in the services sector and investment, he said.
"Individually, Asean countries must reassess their position and rethink their economic strategies," he said.
With regard to foreign direct investment, he said: "In Singapore, we have concluded that the old model of attracting FDI to create jobs will no longer suffice. |
"For the future we aim to be a major hub serving our region, linked up with other major hubs in Asia, such as Tokyo, Shanghai, Hongkong or Mumbai.
To deal with a faster changing and less predictable world, we need to promote the spirit of enterprise, the sense of venture and dare."
Such a spirit is required, he said, as the rise of China and India has spelt "fiercer competition" for the region even as it still coped with political uncertainties brought on by the financial crisis of 1997 and the threat of terrorism.
The changes in China, he felt, spelt the most salient change for the Asian economies, and for the world.
"In the long term, this is a very positive development for Asia. China will be a major market," he said.
But he pointed out that in the short term it presents a major competitive challenge to the rest of Asia as multinational corporations restructure their Asian activities."
"Every South-east Asian country feels this pressure," he said in a speech released here by the Ministry of Information, Communication and the Arts yesterday.
But he felt India's opening up will augur well for South-east Asia for it would counterbalance the pull of the Chinese economy.
On the threat of terrorism, Mr Lee said that "Islamic extremist terrorism is a global problem from which no region is immune" and pointed out that Malaysia, Singapore and Indonesia were taking steps to tackle the problem.
copyright 2003, The Straits Times |
