PM: Integrate Asian economies

(NST) – ASIA should promote economic integration, tackle rising inequality and resolve regional tensions through diplomacy to help propel the region’s future success, Datuk Seri Najib Razak said yesterday.

Speaking at the Nikkei’s 20th International Conference on the Future of Asia here, the prime minister said Asia’s growing global stature and influence had led to the twin challenges of economy and security that require urgent attention.

“Asia’s economy will remain in focus. We are one of the new centres of gravity in a newly multi-polar world,” Najib said in his keynote address at the two-day forum being attended by more than 500 top executives.

“For the Asians of tomorrow, what matters is how we respond to this scrutiny; whether we build strong and sustainable economies, or simply inflate more bubbles; whether we show security leadership, or allow internal tensions to derail the peace upon which prosperity depends,” he said.

This was the second time in four years that Najib had addressed the Nikkei conference, widely regarded as a premier forum for Asian policymakers and business leaders.

Najib, who met Japanese Prime Minister Shinzo Abe yesterday for talks focusing on bilateral economic cooperation, later left for Kazakhstan for a three-day official visit.

The prime minister said it was imperative for Asia, with its increasing economic clout, to further integrate its economies to become more resilient and vibrant.

The projections are staggering, he said. Within 20 years, Asia is set to account for 40 per cent of global gross domestic product and 60 per cent of the world’s middle class.

Najib said greater regional economic integration would include the removal of trade barriers and stronger co-operation on monetary and fiscal policies.

He said he was strongly in favour of the Asean economic community, which will “support jobs and growth for more than half a billion people, and help ensure Southeast Asia’s growth spills across into all member states”.

Najib, however, cautioned against the rising inequality in Asia following the rapid economic growth at a time of globalisation and technological change.

He said over the past 20 years, eight out of 10 Asians found themselves living in areas where income inequality was rising.

While inequality had narrowed in emerging regions, such as Latin America, it has widened in Asia.

“When soaring GDP outstrips living standards, people feel they do not have a stake in their nation’s economic success. That, in turn, undermines social progress and threatens stability,” he said.

“Behind the headline growth figures, it is clear that Asia’s future success depends on broader and more diverse economic development.”

Najib also spoke on regional peace and security, stressing that it was important for nations to resort to negotiations and diplomacy in resolving regional tensions.

“We should heed the fundamental principles on which good diplomacy is conducted: sovereign equality, respect for territorial integrity, peaceful settlement of disputes and mutual benefit in relations.”

He said international law — and not economic or military coercion — should be the basis of any resolution of disputes over resources.