To solve Asia's crises, dialogue is crucial

South China Morning Post
Tuesday, January 21, 2003

By Frank-Jurgen Richter and Thang Nguyen

Francois Duc de La Rochefoucauld once rued: "Hope and fear are inseparable." But perhaps East Asia welcomed the new year with less of the former and more of the latter.

As 2002 came to an end, the region felt the uncertainty of the world economy and the potential impact of an imminent U.S. attack against Iraq. By the end of December, North Korea magnetised the world's attention with its reactivation of Yongbyon, the nuclear plant where Pyongyang is said to have produced bomb-grade plutonium. The incident indeed diverted some of Washington's focus away from Baghdad and put Seoul and Tokyo - both allies of the U.S. - on the alert.

It is tempting to ask: Who should be handling this crisis? The answer depends on who you ask. Some think the United States should be at the helm, but many call for U.S. withdrawal from the region. Thousands of South Koreans demonstrated in front of the American Embassy in Seoul on New Year's Eve against the U.S. presence in South Korea.

Even though many Asians may not feel comfortable having outsiders solve their problems, the crux of the matter is that the crisis on the Korean peninsula cannot be resolved by any nation or organisation alone. But unlike Europe and the US, Asia has no Nato.

There is the Association of Southeast Asian Nations (Asean) - which groups Brunei, Cambodia, Laos, Indonesia, Malaysia, Myanmar, Thailand, the Philippines, Singapore and Vietnam. But Asean is not a security arrangement like Nato. The ultimate goal for Asean is regional and economic integration of the 10 member countries. The Asean plus three (China, South Korea and Japan) initiative remains more or less a project to build a bigger East Asian economic bloc and to deepen regional co-operation on such issues as sea piracy and drug trafficking.

Some countries in East Asia are confronted with domestic priorities that deserve the attention of both regional leaders and the international community.

In Indonesia for example, students have been holding demonstrations in Jakarta since last week calling for the complete withdrawal of the military from Aceh - which signed a peace accord with Jakarta last month - and for a rollback in utility fees, which had skyrocketed over the past few weeks after the government halted subsidies. Most importantly, the students have called for the resignations of President Megawati Sukarnoputri and Vice-President Hamzah Haz. They apparently have the support of some businesspeople and community groups.

One should not underestimate the impact of such demonstrations: they were among the forces that ousted both president Suharto and president Abdurrahman Wahid a few years ago.
Being the world's largest archipelago, fourth most populous country and biggest Muslim nation, Indonesia's stability and leadership are important to the region.

Southeast Asia is experiencing a leadership vacuum. Prime Minister Mahathir Mohamad of Malaysia, the most senior statesman in the region, will step down in October. In Singapore, the timing of the change of leadership is unclear. Gloria Macapagal-Arroyo of the Philippines, who assumed the presidency after the ousting of Joseph Estrada in a popular revolt, recently announced she would not run in the 2004 presidential elections.

In Northeast Asia, leadership is being tested. In China, the inauguration of Vice-President Hu Jintao as Communist Party chief seems to be well-received thus far. This is the most important - and powerful - job in China, and the coming months will be critical for Mr Hu.

South Korea welcomed 2003 with the selection of president-elect Roh Moo-hyun. The unfolding crisis on the Korean peninsula will provide a difficult trial for him.

Prime Minister Junichiro Koizumi of Japan has done rather well, considering how often the country has changed leaders in the past decade. His challenge lies in the arena of economic reforms and growth. As the world's second largest economy, Japan's success is in the interests of Asia and the larger international community.

In addition to asking who should be leading East Asia now, it is also relevant to ask: How should it be led? The answer to this question also depends on who you ask. While some think high-level meetings, the United Nations, or leadership by China, Japan and Russia should be the leading factors, others maintain that the U.S. should be involved and its forces are needed to ensure stability in the region.

Based on our experience at the World Economic Forum, the best way to deal with global and regional challenges is for leaders from all walks of life to gather and discuss the most challenging issues that confront our world - and deal with them in a hands-on manner.

The annual meeting of the World Economic Forum in Davos, Switzerland, therefore takes place at what may be a critical time for East Asia - and other regions. It is the right platform for global peace and improvement.

Frank-Jurgen Richter is director for Asia, and Thang Nguyen is regional manager for Asia, at the World Economic Forum, whose annual meeting takes place this year from January 23 to January 28.

Forging A Lasting Peace - Indonesia needs international support to make the accord work.

South China Morning Post
Dec 27, 2002

By Frank-Jurgen Richter and Thang Nguyen

American educator John Dewey once said, "The best way to abolish war is to honor peace." This is the very principle that is guiding the resolution of Indonesia's regional conflicts.

Indonesia is still traumatized by the October 12 tragedy in Bali, and recovering from it is proving to be no easy task. The economic impacts of the Bali bombing - which killed 192 people, 88 of them Australian, and left more than 300 others wounded - are devastating. The HK$42 billion tourist industry has been severely damaged: tourists are choosing to visit other locations. The economy has already experienced a capital flight as foreign investors and businesses have begun to withdraw their funds and cut jobs. Economists are right to say that the government's growth forecasts for the economy - 3.5 per cent this year and 4 per cent next year - are optimistic.

Despite this dismal outlook, there is hope for peace in Indonesia following the signing of the landmark peace accord between the Indonesian government and rebels from Aceh to end the 26-year conflict that has cost 12,000 lives. The accord gives Aceh more autonomy but not full independence. The Free Aceh Movement had been fighting with the Indonesian military and calling for complete independence from Jakarta. It is important to understand why the Acehnese feel opposed to authorities in Java and want to break away from Jakarta. Occupied by the Netherlands in 1870, the Acehnese fought hard in Indonesia's successful 1945-49 war against the Dutch colonists. Like people in the outer provinces, the Acehnese have been alienated by the Jakarta-centric government.

There is a wide power divide between Java and the outer islands. Under former president Suharto's 32-year regime, the majority of government employees, high-level professionals and middle-class Indonesians were Javanese, most of whom lived in Jakarta. Many government employees were sent to other islands to work in the local governments or to manage state-owned enterprises. Economically, the Suharto administration did many favors for Java, which is not rich in natural resources like other Indonesian islands. The regime protected Java's agricultural sector. The state oil company was run as an extension of Suharto's office. Revenue from the oil sector was used to finance projects favored by the president and the head of the state oil company. Aceh is at the northern tip of Sumatra, which is rich in gas and timber. In giving Aceh more autonomy, the Indonesian government has shown its willingness to decentralize. In addition to economic benefits, it is in Indonesia's best interests not to let Aceh go because, like East Timor, an independent Aceh could have a domino effect in other provinces.

It is also in the best interests of other Asian countries that Indonesia remain intact. The reason is simply that if Indonesia - the world's largest archipelago, fourth most populous country and largest Muslim community - separates into unstable pieces, the region will become unstable, too. For that reason, political leaders of the 10-member Association of Southeast Asian Nations - of which Indonesia is a key member - should support President Megawati Sukarnoputri and her government in worthwhile efforts like the Aceh peace accord. They should offer to help in times of crisis.

Other countries can, and should, help as well. The U.S. and Japan - which have been major supporters of Indonesia - are right to maintain their development projects and other co-operative programs in Indonesia. E.U. nations serve their bilateral relations with Indonesia well by showing their solidarity. The leaders of the E.U. can offer to help, as some of them did for the U.S. after the September 11 attacks.

This effort will take time, commitment and leadership, but it must happen for an integrated and peaceful Indonesia.

Frank-Jurgen Richter is director for Asia and Thang Nguyen is regional manager for Asia of the World Economic Forum.

Regional leaders set their focus on greater integration

South China Morning Post

Nov 14, 2002

By Frank-Jurgen Richter and Thang Nguyen

ASEAN summit emphasizes the need for stronger co-operation between nations to ensure prosperity.

When Asian leaders gathered for the Association of Southeast Asian Nations (ASEAN) summit in Phnom Penh last week, the need for a more integrated and co-operative Asia was a key point on the agenda.

Leaders from Japan, South Korea, India and China met the ASEAN heads and discussed and signed joint declarations on the most pressing issues facing the region at the moment - among which are regional integration, economic co-operation and security.

On the economic front, the need for more co-operation between Asian economies for freer trade was evident at the summit. Regional giants China, India and Japan signed separate trade and economic partnership agreements with ASEAN - which groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

With its market size and relatively cheap labor force, China's entry into the World Trade Organization has appeared to be an economic threat to its neighbors. While this notion seems logical, it is also fair to say its entry has made Asian countries realize they have to do more to make their economies more competitive.

"I do not subscribe to this theory that China is a competitor," Japanese Prime Minister Junichiro Koizumi said during the summit. "We have entered a new age of partnership. We will walk together and advance together."

ASEAN countries have every reason to link up with China, Korea, Japan or India. However, until there is an integrated ASEAN, any economic co-operation with other industrialized countries in the region will be jeopardized because underdeveloped economies will hold back the developed ones.

"They (ASEAN countries) have to recognize the need for regional economic integration on an urgent basis ... the sooner the better," said retiring ASEAN Secretary-General Rodolfo Severino. "It's not easy, but they just have to do it."

On the political front, leaders also called for more co-operation to manage security threats. An encouraging event was the signing of the Declaration on the Conduct of Parties in the South China Sea, aimed at avoiding further conflicts between China and other claimants to the area - namely, Malaysia, the Philippines and Vietnam.

Taking place shortly after the tragedies in Bali and the Philippine cities of Zamboanga and Quezon, the fight against terrorism was undoubtedly the key non-economic item on the agenda.

Following the ASEAN Declaration on Joint Action to Counter Terrorism, which was adopted in Brunei in November last year, the member countries agreed to co-operate more with one another and the international community in the fight against terror.

As the region struggles to deal with the global geopolitical and economic uncertainties, the need for a more integrated, co-operative Asia is indeed now greater than ever.

The summit leaders' actions and commitment will be proof that Asia is a region that, if more integrated, will be ever stronger and more prosperous. The World Economic Forum's East Asia economic summit next year in Singapore will focus on Asian integration.

Frank-Jurgen Richter is director for Asia and Thang Nguyen is regional manager for Asia of the World Economic Forum.

Building Blocks For An Asian Economic Union

South China Morning Post

Friday, October 25, 2002

By Frank-Jurgen Richter and Thang Nguyen

The need for a more integrated, co-operative Asia is now greater than ever before. During the World Economic Forum's East Asia economic summit, held recently in Kuala Lumpur, Asian integration was repeatedly discussed. The three heads of state present - prime ministers Mahathir Mohamad, of Malaysia, Thaksin Shinawatra, of Thailand and Goh Chok Tong, of Singapore - called for more and deeper regional integration and co-operation. In his keynote address, "Deepening Regional Integration and Co-operation," Mr. Goh said the region should push for greater economic integration in East Asia, which would put it in a better position to respond to the formation of large economic blocs in Europe and the Americas.In a session on the institutions that may be needed for Asian integration, panelists voiced a similar view that Asia, with its economic potential and diversity, would be even stronger if it was more integrated. The panel included ASEAN secretary-general Rodolfo Severino, APEC executive director Alejandro Pena Navarrete and former BOAO Forum secretary-general Ajit Singh. To make Asia more integrated, the following must be done.

On the economic front, one of the most pressing issues is the gap in development among Asian countries. Within ASEAN itself, the economic structures of the 10 members differ. While the six original members are newly industrialized economies, the four new members are considered transitional economies. This wealth gap within ASEAN must be bridged to boost the body's position in the world economy. Looking beyond ASEAN, South Korea, Japan and China are the key regional economic powers that also have a crucial role in making Asia an integrated, powerful region - hence, ASEAN plus three.

For ASEAN plus three to work, ASEAN must consolidate itself first and ensure an economic balance among its members before joining South Korea, Japan and China to make yet another regional bloc. Otherwise, the under-developed countries will hold back the developed ones.In addition to pushing ahead with liberalization and increasing intra-regional trade, Asian economies ought to have more monetary co-operation. The idea of establishing a common currency, while inconceivable to some, is beneficial, and could be realized in the distant future. Like the euro, a common Asian currency would reduce transaction costs of trade flows in the region. It also would make Asia less dependent on and therefore less affected by the fluctuations of a major foreign currency, such as the U.S. dollar. On the political front, Asian countries should co-operate more, not less, in several spheres.

The first area is trade liberalization. As World Trade Organization secretary-general Supachai Panitchpakdi has pointed out repeatedly, trade liberalization is the best tool with which to fight poverty. When it comes to reducing both tariff and non-tariff barriers, however, not every country in Asia is fully committed or has successfully illustrated its commitment with measurable actions. Trade liberalization will not work, and therefore cannot benefit Asia, if only some countries do their utmost to reduce barriers, while others do not. The second area for co-operation is human-capital development. Industrialized countries such as Japan, South Korea and Singapore can help developing ones, including Vietnam, Cambodia and Laos, by funding development projects, extending technical assistance and offering more study-abroad or educational exchange programs.

The third, and most important, area is regional security. By sharing intelligence information and having their national law enforcement forces work side-by-side on such issues as sea piracy, human trafficking and drug smuggling, Asian countries can make the region safer and more stable. Now, more than ever before, Asian countries must work harder with one another and with the international community to fight terrorism.

In taking these steps, Asian countries can convince others that the region is integrated and a place of peace, growth and prosperity.

Frank-Jurgen Richter is director for Asia of the World Economic Forum. Thang Nguyen was one of the rapporteurs at the forum's 2002 East Asia Economic Summit held in Kuala Lumpur recently.

Challenges Ahead for ASEAN*

The Edge
September 2-8, 2002

By Thang Nguyen

The foreign ministers from the 10-member Association of Southeast Asian Nations (ASEAN) in Brunei last month and confirmed the appointment of Ong Keng Yong, who is currently Press Secretary to Prime Minister Goh Chok Tong, as the new Secretary-General.
Ong will undoubtedly have a challenging job ahead of him, and ASEAN—which groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam—needs to do more to consolidate itself and achieve its ultimate goal of regional integration.

On the economic side, ASEAN should accelerate its trade-liberalisation process. Like the EU and North America, ASEAN countries have formed their own trade bloc, the ASEAN Free Trade Agreement (Afta). Afta’s key goal is to reduce tariff rates among its members to 0-5 % by 2002. The key instrument with which to hit this target is the Common Effective Preferential Tariff (CEPT). As of this writing, only Singapore has a 0-category tariff rate. Malaysia is well on track with its tariff reductions with approximately 96 percent of its quota in the list under the CEPT schemes. It is unclear as to where other members are with their tariff-reduction schedules.
In addition to reducing tariffs, ASEAN also needs to find ways to increase intra-ASEAN trade. Last year in Brunei, ASEAN leaders discussed the ASEAN+3 proposal, a plan to set up a free trade zone that would include the Association’s 10 member countries, China, Japan and South Korea. ASEAN+3 is a fine plan; however, before achieving this ambitious goal, it may be wise for ASEAN members to focus on and increase intra-ASEAN trade.

There is a notion that the group's economies are too similar to one another and, therefore, can not benefit from trading their comparative advantages. If one examines the different characteristics of ASEAN's economies, however, one will see that industrialised member countries like Singapore, which has almost no natural resources, can export value-added goods and services to and, at the same time, import such primary commodities as rice, timber, and even oil from their neighbors like Indonesia or Vietnam.

Recently, many commentators and trade analysts have warned that China, with its long-awaited entry into the World Trade Organization (WTO), takes away foreign investment from the rest of East Asia and thereby endangers its neighboring economies. While there is some truth to this argument, there is another side to it: China can put a healthy pressure on ASEAN countries to make their economies more competitive, and this can enhance the region’s economic growth.
Another issue is the income divide between the organisation’s member countries. The economic structure of ASEAN is one with two tiers.

The new member countries of Cambodia, Laos, Myanmar and Vietnam—classified as Southeast Asian transitional economies (SEATEs)—are still behind in the development race, whereas the six original member countries (Singapore, Thailand, the Philippines, Malaysia, Brunei and Indonesia) are newly industrialized economies (NIEs). This gap needs to be bridged if ASEAN is to grow together as a group.

On the political side, ASEAN can do more to ensure peace and stability in the region. One of ASEAN’s founding principles is non-interference: that all ASEAN nations shall not interfere with matters that are considered to be a member country’s domestic affairs. While this is a respectable principle in itself, the rest of ASEAN should respond positively when a member country is in an economic crisis or take a collective initiative when its political instability puts the group’s peace at risk.

In addition, ASEAN countries should work closely together on such issues as piracy, human trafficking, drugs trafficking and, more than ever before, terrorism. Even though the US has shown itself to be a coöperative partner to East Asia, self-reliance remains the key to success for ASEAN in these areas. The organisation should encourage member countries to share more financial, immigration and other related intelligence among themselves and establish ways in which national law enforcement forces work together side by side.

Besides the upcoming replacement of its secretary-general in November, ASEAN has recently experienced a transition in its leadership. Among the group’s leaders, Dr Mahathir Mohamad, Prime Minister Goh Chok Tong and Sultan Hassanal of Brunei have been ASEAN’s most senior leaders. With Dr Mahathir’s resignation by October next year, ASEAN’s core group of leaders will shortly be left with two.

Together, these transitions of ASEAN’s leadership suggest that the new secretary-general and the leaders of all member countries have a lot of work cut out for them in the near future. To take ASEAN forward, they will have to collaborate with and trust one another to ensure stability. But most importantly member countries, such as Singapore, Malaysia and Brunei, who are economically better off should do their utmost to help their fellow other member countries, who also need to do their best to help themselves, improve their economies. This is the way the group can grow and enjoy prosperity together. After all, ASEAN’s mission statement is: “To bind [member countries] in friendship and co-operation and, through joint efforts and sacrifices, secure for their peoples and for posterity the blessings of peace, freedom, and prosperity.”

*Frank-Jürgen Richter contributed to this article.

The gloomy state of today's world

International Herald Tribune
Friday, August 30, 2002

By Thang Nguyen, with Frank-Jurgen Richter

Friday, August 30, 2002

GENEVA--Graham Greene once said, "I often find myself torn between two beliefs: the belief that the world should be better than it is and the belief that when the world appears to be better, it is actually worse."

During the World Summit for Sustainable Development, now taking place in Johannesburg, it is necessary to question ourselves honestly on the state of the world.

Since 1992 when the United Nations held the Earth Summit focusing on environment and development in Rio de Janeiro, the state of the world has deteriorated.

On climate change, for example, the Intergovernmental Panel on Climate Change reports that the increase of global warming in the past 50 years "is attributable to human activities" and that by 2100, temperatures will increase by 1.4 to 5.8 degrees centigrade.

The special world summit edition of "The State of the World 2002," an authoritative publication by the Worldwatch Institute, cites similar alarming trends in health, agriculture, population growth, natural resources and other areas of development.

"Ten years after the Rio Earth Summit, we are still far from ending the economic and environmental marginalization that afflicts billions of people," says the institute's president, Christopher Flavin. His words refer to the increasingly widened divides - wealth, health, digital and so on - between the industrialized and developing worlds.

Some view these divides as consequences of globalization. Is globalization the cause of these divides? The answer depends on who you ask. Officials from the International Monetary Fund, the World Bank and the World Trade Organization would tell you that globalization has improved the world by increasing international trade and capital flows, transferring technical know-how, and giving jobs to the developing countries.

But if you asked the people from Third World countries or critics of globalization, they would tell you otherwise. For them, globalization is nothing but a process by which the rich and powerful enjoy the fruits of wealth at the expense of the poor and the powerless, and international institutions are responsible for all the mishaps that it causes. Many critics of globalization organize themselves to protest every time these institutions launch a summit.

In "Globalization and Its Discontents," an influential book, the 2001 Nobel laureate in economics, Joseph Stiglitz, argues that, as well-meaning as they may be, the IMF, the World Bank and the WTO have failed to deliver the benefits of globalization to the developing world.
Citing both East Asia's economic success as a result of globalization and the wrong medicine that the IMF prescribed for the victim countries of the 1997 Asian financial crisis and other cases, he recommends that these global institutions need to reform their policies so that they can make globalization fairer and work for everyone.

The world economy had already been feeling experiencing turbulence when the tragic events of Sept. 11 created a new crisis in the United States.

Worse, while having to fight terrorism, the United States has recently been hit by the corporate governance scandal. Such gigantic corporations as Enron and WorldCom collapsed. As of this writing, United Airlines has signaled signs of danger, and no one really knows which will be the next corporation to fall.

In security terms, the post-Sept. 11 world is more fragile and uncertain than ever before.
Insurgencies in South Asia and the Middle East continue to worsen. We are also warned of a potential U.S. attack on Iraq. No one can say for sure when, where, how or if this attack will take place.

As we are confronted with all these global challenges, the need for open and solution-driven discussions is greater now than ever before. Based on our experience with the World Economic Forum, we strongly believe that a multi-stakeholder approach with a balanced participation - including the private sector recognized as a full part of society, governments, international organizations and various representatives of civil society from all over the world - is the best way to tackle global issues head on.

Green's observation reminds us not to be complacent about the state of the world. In fact, let us acknowledge that the world in which we are living is getting worse every day and, each and every one of us - regardless of our professions, race or religion - is responsible for and has a role to play in the process of making it a more just and livable place.

The writers are with the World Economic Forum, Geneva. They contributed this comment to the International Herald Tribune.

Witnessing a Slow Dawn in Indonesia*

Jakarta Post, Indonesia

Wednesday, August 21, 2002

By Thang Nguyen, World Economic Forum, Geneva

As Indonesia celebrated its Independence Day on 17 August it is an appropriate time to reflect on where it is and try to sketch a roadmap for its future.

Recently, there have been signs of progress. Indicators as inflation and interest rate are low, and the rupiah is going up. Economists and analysts even forecast a 5 % growth for next year.
But perhaps the most notable sign of progress in Indonesia revealed itself last week when the People’s Consultative Assembly (MPR) approved a mixed package of constitutional reforms that, if properly implemented, would make Indonesia truly the third largest democracy in the world.

Designed to take full effect by 2004, the reform package focused on three critical areas, namely: the executive power, the role of the military in Indonesian politics, and Islamic fundamentalism. On all three issues, members of the MPR showed with their votes that they desire an electoral system in which the president is elected by the people, a military that is professional and a government that is both civilian and secular.

Those who know Indonesia’s history and politics will tell you that the passing of these laws is a major event, and the new legislation could help the country break away from its rather unfortunate past.

In the past, the president would be elected indirectly by the MPR members who gave their votes of confidence. Under the new law, the president will be elected by a popular vote. In addition to promoting direct election, the new system will also make the executive and legislative powers more independent of each other. After all, the job of the MPR, like the US Congress, is to make laws, not the president.
The reform on the role of the Indonesia Military (TNI) separates the armed forces from its politics. It removes the 38 seats that were in the past occupied by, and reserved for, TNI members.

Breaking from this dwi fungsi has two crucial implications. First, it ensures that the TNI is professional, that is, its sole responsibility is to defend the country and to protect its people. Second, and more important, it will help the TNI rebuild its credibility.

The reform package also reiterates that Indonesia is a democracy and not a theocracy. The MPR rejected a motion to institute sharia, or Islamic law, across Indonesia. After the tragic events of Sept.11, Indonesia, home to the world’s largest Muslim population, has been regarded by some as a potential haven for terrorists, basing on the theory that they might have been linked to the Al Qaeda.

A recent report by the International Crisis Group (ICG), a multinational non-governmental organisation headed by the former Australian foreign minister Gareth Evans, rejects this claim with the conclusion that there is scant evidence of links between the Al Qaeda and radical Indonesians, however.

The approval of these constitutional reforms is indeed a remarkable step forward for Indonesia. As Indonesia looks toward its near future, however, there are some long-existing, but pressing issues that deserve special attention and require more, not less, action.

The first is how to further eliminate corruption, collusion and nepotism (KKN). Indonesia, one of the prominent victims of the Asian 1997 financial crisis, has been, and still is, criticised for its dearth of transparency and governance in both the private and public sectors.

In addition to establishing such institutions as the Indonesian Bank Restructuring Agency (IBRA) to increase transparency, the MPR can also make more laws to ensure corporate governance. Once passed, these laws must be applied in an incentive-based and draconian manner.

This means that businesses—state-owned or private—whose performance is proved both profitable and KKN-free should be rewarded with more business contracts or other opportunities and those whose performance is otherwise must be judged and persecuted accordingly.

Another thing that can be done is to increase the salary of middle- and entry-level civil servants, so that they do not have to take briberies in order to support themselves and their families.

The second is how to improve Jakarta’s relations with the outer islands. Experts often describe its inter-regional relations as Java-centric. Java, which has almost no natural resources, has always been the most favored child and the most powerful sibling in the Indonesian household, especially during Suharto’s 32-year presidency.

To solve this problem, Jakarta needs to have more dialogues with such provinces as Aceh—which has been calling for independence from Jakarta—and give them more regional autonomy. In doing so, Jakarta can keep Indonesia together.

The third one is how to improve Indonesia’s inter-ethnic and inter-religious relations. Known to Indonesians as SARA, the inter-ethnic and inter-religious relations cause serious conflicts when they are mismanaged. One among them is the unresolved May 1998 riots in which over 1,000 were killed in some 5,000 Chinese-owned stores and buildings and dozens of women, mostly Chinese, were sexually assaulted and raped.. Also, violent clashes between Christians and Muslims have often taken place in Maluku and other provinces.

Together, these insurgencies call for more nurturing policies that can bring about equality among all Indonesians.

If Indonesia can manage to confront these major challenges and implement the constitutional reforms approved early last week, it will certainly be a more domestically united democratic nation and a reliable and stable partner in the region.

As for Asia and the international community, Indonesia is too important to ignore. Countries in other regions as well as international organisations, such as the IMF and the World Bank, can also encourage, and play a role in helping Indonesia, to continue making progress.

*Frank-Jürgen Richter contributed to this article.

Growing Asian antipathy for the global policeman

The Business Times
Singapore

July 9, 2002

Sentiment is rising in this part of the world for America to fight its battles on its own turf - and to respect the national priorities of other countries

By Thang Nguyen

SINCE last Sept 11, the United States has made efforts to take its campaign against terrorism to Asia. Washington's message is clear: terrorism is a threat to all of us, and Asia, like other regions, should join the U.S. in the fight against it.

Nevertheless, the U.S. seems to be alone in this fight. While most Asian leaders may support Washington's campaign, they have other domestic priorities that are more urgent to them than the fight against terrorists. Moreover, there is a perception that the U.S. is taking on the role of the world policeman in Asia. However noble the U.S. motives and intentions may be, many in Asia remain wary.

Thus far, the U.S. has sent 1,200 troops and a US$100 million aid package to the Philippines. Its main rationale is to help the Philippines fight the Abu Sayyaf, a group of southern Muslim rebels.

Since the Philippine Constitution prohibits foreign forces from engaging in combat on its soil, Washington has no choice but to camouflage its fight against the Abu Sayyaf as a 'training' programme for Philippine soldiers. But the fact remains that the US forces would also like to make use of the occasion to rescue an American missionary couple kidnapped by the group more than a year ago.

Five months have passed since the U.S. troops arrived on the island of Basilan, where the Abu Sayyaf are based. Recently, a clash between Philippine soldiers and the rebels killed one of the American hostages, wounded the other and killed a Philippine hostage.

Since this event, some Filipinos have questioned the role of the U.S. in the Philippines. Last week, Vice-President Teofisto Guingona quit his concurrent Cabinet post as foreign secretary over the issue.

It is unclear how long the US troops will stay in the Philippines, but the former colonial ruler's relations with the Philippines will always be ambivalent if the US maintains troops there on a permanent basis.

As the Kashmiri insurgency worsened in the past few months, the Bush administration also began to play the role of a crisis manager in South Asia. Secretary of State Colin Powell led a campaign to persuade both India and Pakistan from escalating their conflict.

Recently, U.S. Defence Secretary Donald Rumsfeld visited the region. In making these diplomatic moves, Washington hoped - out of the belief that Osama bin Laden is still alive and perhaps hiding in Kashmir - to rid Al-Qaeda left-overs who might have run away from Afghanistan.

As sensible as this effort may seem, both the Indians and the Pakistanis are simply too preoccupied with their own situation to even think about anti-U.S. terrorists, let alone helping Washington find them.

Supported by its hawkish members like Deputy Defence Secretary Paul Wolfowitz, a former ambassador to Indonesia, the Bush administration has also been talking about resuming its military assistance to Jakarta.

Being home to the world's largest Muslim population, Indonesia would appear to be a legitimate concern to the U.S.. But the Bush administration may run into domestic resistance in the U.S. The Indonesian military is accused of atrocities and human-right abuses in the now independent nation of East Timor and in other regions in Indonesia over the past few years.

For this reason, the U.S.Congress may not approve the plan to send military aid to Indonesia. Some members of the Congress, such as Senator Patrick Leahy of Vermont, argue that the U.S.should not forget the past human-rights violations by Indonesia's military.

Furthermore, as Indonesia tries to overcome its own economic hardship and to manage its inter-ethnic, inter-religious, and inter-regional conflicts, it is clear that fighting terrorism is not the first item on the government's list of priorities.

'Combating terrorism only constitutes one priority when maintaining territorial integrity; recovering the economy and resolving communal conflicts have to be given high priority on the national agenda,' said Matori Abdul Djalil, the Indonesian defence minister, during an Asia Security Conference held last month in Singapore.

Beyond South-east Asia, other Asian nations cannot be of much help to the US in the fight either. Japan is too busy trying to get out of its economic troubles, and that is a more urgent priority for Japan than terrorism.

As for China, economic growth is the most important issue on its national agenda after its long-awaited entry into the World Trade Organization (WTO). Furthermore, as the host of the 2008 Olympics, China has a lot of work cut out for it.

Despite Vice-President Hu Jintao's visit to the U.S., Beijing will not join Washington in its campaign mainly because of the Bush administration's relations with Taipei; it is a sore point for China.

Finally, there is a perception in Asia that Sept 11 has not changed the region much and that the fight against terrorism is an American problem. As such, some Asians would prefer that America not fight its war on their soil. 'The best thing the U.S. can do is stay away,' said Rizal Sukma of Indonesia's Centre for Strategic and International Studies.

So what are the lessons from the U.S.' post-Sept 11 engagement in Asia? The first is that America's fight against terrorism is misperceived as a unilateral act of intrusion in many parts of Asia. There is also a fear that regional conflicts may not be resolved just because the U.S. becomes involved. As a matter of fact, many believe these conflicts may worsen when the U.S. gets involved. This is exactly how the American war in Vietnam started - and what was the end result?

Before getting into adventures in other parts of the world, the U.S. should, therefore, have a clear objective and ensure that it has the support of both the American people and Congress at home.

Whatever the U.S. would like to do in Asia - or any other region for that matter - it should keep in mind that other countries have their priorities, and that it must win the hearts and minds of their peoples before coming here to do battle.

The writer is regional manager for Asia at the World Economic Forum. The views expressed in this article are his personal opinion and do not represent those of the World Economic Forum.

Get serious about Asia, too

International Herald Tribune
Monday, July 8, 2002

The G-8 should wake up

by Thang Nguyen

GENEVA--As in Africa, there are developing countries in Asia which could use assistance from the Group of Eight partners to deal with health, education, governance, agriculture, environment, trade, investment, poverty and security. A recent study by the World Bank shows that 43.5 percent of the world's population that lives on less than $1 per day is in South Asia, and 23.2 percent is in East Asia and the Pacific region. Other studies by UN agencies show that Asia is on the low end of such spectrums as education, health and the digital divide.

For much of the second half of the 20th century the Asian economic miracle fueled an enormous amount of wealth in the region. Countries like Thailand, Indonesia, South Korea and Malaysia were transformed into newly industrialized economies.

Yet at the same time Vietnam, Laos and Cambodia were still fighting wars, against foreign powers or one another. As these countries concentrated their economic resources on fighting wars or dealing with other conflicts instead of development, they fell far behind in the development race.

When the Asian financial crisis of 1997 came, the most prominent victims were the Asian Tigers - Indonesia, South Korea, the Philippines and Thailand.

Today Asia still experiences political instability. Since 1998, when democratic movements removed President Suharto from power, Indonesia's internal conflicts have worsened. President Gloria Macapagal Arroyo, who is perceived as an able leader, took office at a time when the Philippine economy was at one of its worst points and other problems, such as the Abu Sayaff rebels, became more serious. In South Asia, the Kashmiri insurgency between India and Pakistan has been escalated to a near-war stage.

Perhaps it is time that someone follow in Bono's step and take leaders of the industrialized world like U.S. Secretary of the Treasury Paul O'Neil and Prime Minister Chr้tien, both of whom have toured Africa, to India, where there are people who live on less than $1 a day, children who are unvaccinated and unschooled, and old women and men who are dying of curable diseases.

The time is right for an Asia Action Plan to be proposed to G-8 countries. This plan would be a combined and balanced package of aid, increased trade and investment. The reason is that there are developing countries in Asia which are not yet at the takeoff stage at which they can grow independently by exporting well and having enough capital flows.

In order for aid to work in Asia, or any other developing region for that matter, it must be given in a draconian, performance-based manner. If recipient countries do not show results, donor countries have every reason to cut off their aid.

In addition to monitoring the results of aid, donor countries should make sure that it goes to areas such as education, through which a country's productivity can be increased. As the Chinese proverb says, teaching a man to fish is better than giving him a fish.

Developing countries in Asia have to do their utmost to bring about and sustain political stability. Their leaders must show both a genuine sense of commitment to reforms and act on what they say they will do to better their countries. Otherwise their countries will be too risky to foreign investors.

They have to ensure good governance, transparency and a competent labor force. It may seem a clich้, but these are the ways in which Asian developing countries can make themselves more competitive in the world economy if a plan like this is launched by leaders of Asia and the G-8 countries. The developed world has three options. First, enjoy the fruits of economic growth while the inequalities between itself and the developing world keep widening. Second, be held back by the underdeveloped world and cause global anger at the same time. Third, help the underdeveloped countries to grow and thereby make the world a more just and livable place.

The writer is regional manager, Asia, for the World Economic Forum. He contributed this comment to the International Herald Tribune.

Books

Books:

Title/Publisher/Publication Date

Indonesia Matters: Diversity, Unity, and Stability in Fragile Times Times Editions July 2003

The Malaysian Journey: Progress in Diversity Times Editions October 2003

The Indonesian Dream: Unity, Diversity, and Democracy in Times of Distrust Marshall Cavendish Academic July 2004

Curriculum Vitae

Thang D. Nguyen is a Jakarta-based columnist. A prolific and provocative writer, Thang pens frequently on Indonesian and Asian affairs for international and major Asian newspapers, including The Asian Wall Street Journal, The Australian, The International Herald Tribune, The Jakarta Post, The Nation, The New Straits Times, The South China Morning Post, and The Straits Times.

He has also published several books, including Indonesia Matters: Diversity, Unity, and Stability in Fragile Times (Times Editions, 2003) and The Malaysian Journey: Progress in Diversity (Times Editions, 2004); and The Indonesian Dream: Unity, Diversity, and Democracy in Times of Distrust (Marshall Cavendish Academic, 2004).

He is also the Program Director of the United in Diversity Forum (www.unitedindiversity.org). He wrote and actualized the program of a forum of 400 participants in Bali, Indonesia, in December 2003. Currently, he is in charge of the Forum’s Aceh Initiative, a sustainable 15-year, tri-sector effort to help the Acehnese build their post-tsunami future.

His previous professional experience also includes a 6-month international image-building campaign for the Government of Indonesia as commissioned to APCO, a global communications firm. While at APCO, he was tasked with promoting a better, more perceptive understanding of Indonesia abroad. He designed, prepared, and sent 3 goodwill delegations composed of dignitaries to speak on post-Suharto Indonesia and its developments and progress in Australia, Europe, and Europe. Among other responsibilities, Thang reached out to Indonesianists and opinion leaders from Indonesia and abroad to commission and place Op-Eds about Indonesia in major international and regional media.

He was, for 3 years, with the World Economic Forum (WEF) in Geneva, Switzerland, where he was a Regional Manager for Asia. While at the WEF, Thang was in charge of the Business Interaction Groups (BIGs), a series of informal, private gatherings of global business leaders and public figures from developing countries at its Annual Meeting in Davos, a global, foremost gathering of 2000 participants from business, politics, and civil society. He was responsible for its Indonesian and Southeast Asian affairs and managed its relations with the governments and national leaderships from the region.

Thang has been a discussion leader at international fora, including the World Economic Forum (WEF), the Asian Strategic and Leadership Institute (ASLI), Ernst and Young Indonesia, and the Young Presidents’ Organization (YPO).

A recipient of numerous awards, Thang holds an AA in liberal arts (cum laude) from Springfield Technical Community College (STCC), Massachusetts, US; a BA in American studies (magna cum laude and phi beta kappa) from Hobart College, New York, US; and an MA in international relations and economics from the Paul H. Nitze School of Advanced International Studies (SAIS), Johns Hopkins University, Washington, DC, US.

Thang is a member of the United States-Indonesia Society (USINDO) and the Jakarta Foreign Correspondents’ Club (JFCC).