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Charting the course for Asian economic integration

May 25, 2005

Dato' Seri Abdullah Ahmad Badawi
Prime Minister, Minister of Internal Security, Minister of Finance, Malaysia

Excellencies
Distinguished guests,
Ladies and gentlemen.

We meet at a pivotal moment in the regional history of East Asia and in the continental history of Asia. Today's news and events - a surfeit of drama and intrigue, perception and deception, real and imagined - have not been seen in East Asia over the last two decades.

2. This is in part a result of manoeuvres and stratagems not uncommon in the game of nations. In larger part, it is the result of the rise of new opportunities, new possibilities, new hopes, new fears, new dreams, new political forces and new mindsets on the part of some key actors.

3. At this pivotal moment, speaking as an East Asian, let me make the very strongest plea for uncommon sense and sensibility. If ever there was a time for outstanding historic statesmanship in East Asia, the time is now.

4. For Asia, as for East Asia, it is critically important that we do not now take the wrong turn. It is critically important that we do not now venture down the wrong road. It is critically important that we are not led up the garden path and that we do not skid down the slippery slope to oblivion - to the return of another kind of history: when Asia was in its dark ages, given up for lost, Impoverished and in despair, when we were divided and carved up, and easily sliced like a melon, at the wham and fancy of others.

Ladies and gentlemen

5. At this pivotal moment, there is a critical need for the clearest of strategic vision and the deepest of strategic thinking.

6. I believe that all strategic vision and thought must flow from a clear conception of ultimate objectives. Malaysians have little problem with regard to the society that we must become, and the regional and super-regional communities we must diligently build in the decades and generations to come. Our course was well set many years ago, and we are well on track.

7. By the year 2020, Malaysia must be a comprehensively developed country, developed economically, developed politically, developed socially and culturally, progressive and caring.

8. Our four decades-old traditional doctrine of security and defence tells us that we cannot protect whatever we achieve at home unless we ensure that our home resides in a safe neighbourhood. We cannot be secure unless our country lives within a Southeast Asian community of peace and friendship, something we have been devoted to building for more than 40 years. This explains our deep commitment to the creation of the Asean security community - the A.S.C. - that all Asean countries agreed to in the bali concord two [ii] in Indonesia in October 2003.

Ladies and gentlemen

9. We also believe that Malaysia cannot prosper economically, that we cannot accomplish the 2020 economic goals to which we are dedicated, unless we reside in a Southeast Asian community of rapid growth and prosperity. This is why we are committed to the doctrine of "prosper thy neighbour". This is why we abhor the impulse of "beggar thy neighbour". This is why we are deeply committed to the creation of the A.E.C., the Asean Economic Community.

10. We also believe that in order for us to achieve our objective of becoming a fully progressive society we must be very much a part of a region that is modernising and progressing at great speed. This is why we are deeply committed to the creation of the A.S.C.C., the Asean Socio-Cultural Community.

11. Of course we know that the nation state is the primary engine for advancement and progress. No-one can do to us anything worse than what we are capable of doing to ourselves. No-one can do for us what we must do for ourselves, within our own domestic borders. Fundamental change cannot come from external pressure. It must come from our own hearts, from our own determination and from our own energies. But we must ensure that we live securely in an Asean community that fosters peace, prosperity and progress; and we must ensure that our Asean community lives securely and is nurtured within a wider East Asian community of peace, prosperity and progress. We must build the wide and wider communities that will nuture and nourish us.

12. Let no-one misunderstand. For the foreseeable future, for the nations of Southeast Asia, the very highest priority must be given to rapidly building the Asean community of peace, prosperity and progress. As far as the East Asian community of peace, prosperity and progress is concerned, there will be times when it must and will command the very highest priority. There will of course also be occasions when promoting wider Asian cooperation and integration - in an ever widening neighbourhood of Asean - cooperation will come to the fore.

13. The central issue I would like to stress is that our community-building and integration efforts will cover many geographical regions and sub-regions. No major champion of regionalism and regional integration in Asia can be expected to concentrate on pursuing the singular, "heroic", "Asian" project, to the exclusion of everything else.

14. The course of Asian integration will also be multi-dimensional. It cannot be expected to be confined only to trade, or even narrower still, to free trade areas, agreements and regimes.

15. And the course of Asian regional integration will unavoidably be multi-layered. This is because, especially in the economic realm, the real movers and shakers, builders, engineers and integrators will not be governments but importers and exporters, tour operators and shipping agents, airline companies, civil society and media organisations, the transnational corporations of Asia, Australasia, the Americas, Europe, and the enterprises - small, large and gigantic - from every part of the world. The best thing for East Asian governments to do is to recognize these realities and avoid creating any barriers or obstacles.

16. To summarise: I believe it is clear that the course of Asian economic integration should and will proceed on a wide front. It will be multi-dimensional and multi-layered. The continuing dynamism of the Asean countries and the commitment of the plus three countries to Asian economic integration will be crucial all this is to the good of all.

Ladies and gentlemen

17. So much lies in the years and decades ahead. But let me now turn to a matter of much greater immediacy: the subject of building the East Asian community of peace, prosperity and progress, a joint venture that is now well on its way; and the subject of the holding of the first East Asian summit in December in Kuala Lumpur.

18. As you all know, the first Asean+3 summit was held in Kuala Lumpur in 1997. The Asean+3 summit that will bring together the leaders of Asean, China, Japan and South Korea in Kuala Lumpur in December this year will be the ninth Asean+3 summit. It will not be the second or the third or the fourth or the fifth. It will be the ninth.

19. Over the long and sometimes difficult years, we have developed not one, not two, but no fewer than 48 Asean+3 meetings and processes.

20. At the ministerial level, Asean+3 ministers already meet regularly to discuss:

• East Asian political and security cooperation;
• East Asian economic, trade and investment cooperation;
• East Asian finance and macroeconomic surveillance cooperation;
• East Asian agriculture, fishery and forestry cooperation;
• East Asian energy cooperation;
• East Asian environment cooperation;
• East Asian tourism cooperation;
• East Asian cooperation regarding transnational crimes;
• East Asian health cooperation;
• East Asian labour cooperation;
• East Asian culture and arts cooperation;
• East Asian i.c.t. cooperation;
• East Asian social welfare cooperation.

21. At the lower senior officials level, the Asean+3 have also established additional processes for East Asian cooperation, namely:

• on youth issues;
• on science and technology; and
• rural development and poverty eradication.

22. I have listed all these well-established Asean+3 processes, firstly, because all those who only see dollar signs and "making money" possibilities in their enthusiasm for very active, direct participation in the East Asian community- building process, should have a clearer idea of what they are getting themselves into. Many have absolutely no idea. Many seem to have developed clear calculations on what they can take away from the East Asian table. But many have devoted no thought on what they can bring to the East Asian table.

23. They are clearly prepared for the privileges of participation. But have they given the necessary thought to the responsibilities of participation?. And are they prepared for the long haul?.

24. East Asian community building must be patiently built over generations. This multi-generational process should not be in the hands of passing fads and fancies; it is not an opportunity to be grasped today, When "money making" prospects loom large, to be forgotten tomorrow, when the grass is nowhere quite as green as first assumed.

Ladies and gentlemen

25. I have also listed all the already well-established Asean+3 processes because having gone so far, it seems extremely silly to wipe the entire slate clean and to go back to the very beginning. W e should also not do the dance of cha-cha, going forward and backward on the same spot. It makes no sense to go back to square one, especially since everyone agrees that we have been on the right track. An East Asian community is developing rather well, which is why so many countries from so many continents are so insistent on getting on board the East Asian train, and none of us already on board want to get off.

26. But let me back-track a little. As you well know, in December 1998, on the initiative of president Kim Dae-Jung, the Asean+3 summit established the E.A.V.G. (the East Asia vision group), consisting of prominent East Asian intellectuals, who were given the responsibility of charting a vision for the development of cooperation and integration in East Asia. The East Asia study group, consisting of Asean+3 government officials, was set up in March 2001 to review the recommendations of the East Asia vision group.

27. In the very first paragraph of their report, the East Asia vision group enunciated the vision of "an East Asian community of peace, prosperity and progress based on the full development of all peoples in the region". The leaders of the Asean+3 endorsed and supported this vision, following on the endorsement and support of the inter- governmental East Asia study group. As you will have noted, I too endorse and fully support this vision.

28. The East Asia study group in its report stated: "the E.A.S.G. is of the opinion that the Asean+3 framework remains the only credible a nd realistic vehicle to advance the form and substance of regional co-operation in East Asia". I fully concur.

29. In addition, let me place on record my appreciation for the good and sensible work done in Tokyo almost exactly a month ago by the "working group on overall architecture of community building in East Asia" under the leadership of N.E.A.T. Japan.

30. This working group of N.E.A.T. (which stands for Network of East Asian think- tanks) unanimously adopted the view that "the primary vehicle for the building of the East Asian community should be the Asean+3 process". There was also full consensus that the East Asia summit would not be an organisation but a forum, which should be the vehicle for Asean+3's engagement with other countries.

31. The working group of N.E.A.T further suggested that while East Asia community-building would be the work of the Asean+3 summit and the Asean+3 processes, the East Asia summit should be the vehicle through which Asean+3 carry out dialogue with other countries; and through which Asean+3 contributes to them and they contribute to Asean+3. I believe it would be worthwhile for governments to take into account this view of the think-tanks of East Asia, which worked under the leadership of N.E.A.T. Japan.

32. I believe that it would be sensible to prevent an overlap of the mission and work programme of the two processes. For instance, the Asean+3 summit can take charge of the process of building the East Asian community of peace, prosperity and progress. The East Asia summit, on the other hand, could concentrate on how East Asia can contribute to the world and how the rest of the world can participate in the growth and prosperity of East Asia, so that we can all prosper together.

33. The agenda for the Kuala Lumpur East Asia summit could be a very exciting one. It could range from currency, energy and global growth issues to our common struggle on terrorism to `how we can eradicate abject poverty' and become the first developing-country region in the world to achieve the millennium development goals, and to how we can enhance our capacity for Asian economic integration through the development of basic economic infrastructure which includes super-highways and super- railways linking and binding our East Asian community. This could come in the form of an Asian infrastructure development initiative or A.I.D.I. Of course, an idea such as this would require us to tap whatever resources available to us. On this, I am heartened by the fact that Asia is on the move - its self-confidence boosted by strong and sustainable income growth and balance of payments surpluses. More significantly, Asia's savings in foreign exchange reserves are rising and indeed surpassing nationally set benchmarks. The ADB recently reported that Asian central banks today control more than two-thirds of global foreign exchange reserves, the aggregate held being in excess of US$2.5 trillion. A fraction of our savings could be utilised to achieve this purpose. This is a matter that can be pursued furtherbthrough the Asean process.

34. It is Malaysia's preference, of course, that the agenda for Kuala Lumpur be determined not by Malaysia alone but multilaterally, on the basis of consensus and comfortable agreement, without heavy-handedness, pressure or prejudice.

Ladies and gentlemen

35. With regard to the East Asia summit, I am glad to see that so much good work has already been done by Asean senior officials and ministers in Cebu and by Asean+3 senior officials and ministers in Kyoto.

36. Our East Asian community must stand for something. Others may want other things. They may think peace is for soft-headed "peaceniks" and "friendship" means nothing in a world where dog must eat dog. They have a right to believe what they believe. What we want to build in our own part of the world is a community that is committed to the core - to the very core - of peace and the pacific settlement of disputes. It is good to see that in Kyoto, the Asean+3 agreed that any country wishing to participate in the East Asia summit must first accede to Asean T.A.C (that is, the treaty of amity and co-operation) that has already been acceded to by China, Japan, South Korea, India, Pakistan, and Russia.

Ladies and gentlemen

37. Many suggestions have of course been made with regard to the East Asian summit. Many more will arise as the date draws nearer.

38. One very insistent suggestion is that we should be "inclusive". Let me say that I agree with this suggestion.

39. Secondly, given the fact that so many in the world want "in" on the "hottest" game in town, which everybody expects to continue to be the "hottest" game in town, we cannot say "yes" to everyone. We do not wish to have a mini united nations. We do not wish to duplicate Apec, not to mention other organisations.

40. Third, and quite obviously, we should not admit those states that want to wreck our purpose or pervert our cause, or that are opposed to our interests. Perhaps this point is too obvious to require elaboration.

41. Fourth, in the Asean+3 formation, there is already massive critical mass. At this stage, what do we gain by adding even more mass if by doing so, we compromise forward momentum or even risk a derailment?. Obviously, evolution and time will ensure a grouping of more than 13. But in the immediate days a head there is eminent common sense in not widening prematurely, and in initially concentrating instead on rapid and productive deepening.

Ladies and gentlemen,

42. The great idea of building an East Asian community was first proposed not many more than a dozen years ago. What is remarkable is how fast the transition between scepticism to conventional wisdom has taken. Those of us who believe in the building of the East Asian community of peace, prosperity and progress must now move forward with pride and with confidence, with apology to none, and with goodwill to all. We have a right to demand the right to determine our future and the future of our children.

43. At the same time, we must move forward on the basis that we have a responsibility to discharge and a contribution to make. That responsibility and contribution is not only to all our people, but also to the people in the wider world beyond East Asia. That responsibility and contribution cannot only be in terms of material advancement but also in terms of spiritual and civilisational progress. Only then can we justifiably speak with a sense of pride, dignity and achievement for Asia.

Thank you.

Titles of speakers, names of companies, etc., were correct as of the time when the forum was held.