Sunday, May 01, 2005

Can Asia become a global 'third force'?

South China Morning Post
Wednesday, February 12, 2003

By Jurgen Richter, Pamela Mar and Thang Nguyen

The annual meeting of the World Economic Forum in Davos, Switzerland, took place at a critical time. The imminent American-led attack on Iraq, the challenge of revitalising the U.S. economy, the need for better governance and the challenges in trust-building in international society dominated the agenda.

A world inching towards war and the lack of signs of a global economic recovery have created a search for hope. Could this come from Asia? The vision of Asia as a third force in global politics and economics would have elicited laughs in the past, but in the current global environment it is plausible. The current tug-of-wills over North Korea, the emergence of China as the only growing major economy and the moves towards creating a pan-Asia trading bloc - potentially including India - are all signs of Asia's growing significance.

Making Asia into a true "third force", however, will not come through independent strands such as those described above, although they will certainly serve as supports. Instead, it will take leadership within Asia to carve a vision from the many policies and initiatives that exist within the region. Asian countries have recognized the changes needed to enable economies to pull out of stagnation and make waves on a global level. China has taken a lead in averting stagnation, but much more needs to be done to make Asia a coherent global force, and not one led by numbers alone.

Three changes that would set the region on the right track are in governance, regional and cross-border partnerships, and trust between old and new generations. These developments can all be found among young leaders - in business, politics and third-sector organisations - who have proposed blueprints for the region's reconstruction. These young leaders have come together through the World Economic Forum's New Asian Leader Network, to brainstorm, swap ideas and plans, and garner support for further action.

In addressing changes in governance, the network's Japanese branch highlighted the burdens of bureaucracy, corruption and the "old order". They propose a reorientation of society, based on merit and a willingness to act. "Japan is now at a stage whereby the leadership needs to take some risks in society," said Oki Matsumoto, president and chief executive of online brokerage Monex, who helped to draft the plan. "Otherwise we're just too comfortable." For the Japanese members, the problem of governance goes beyond a lack of transparency and accountability, becoming a question of who governs and how they govern. "We can change if we can break down this great wall of the bureaucrat-governed state," said Jiro Tamura, professor of law at Keio University in Tokyo.

Second, a new Asia will not come together without more cross-border understanding and partnership. Asians have many historical burdens to overcome, having fought wars and squabbled over trade and the writing of history. The current stasis over North Korea illustrates again the lack of understanding of each other's priorities.

In the age of globalisation, young Asians are no strangers to the Internet and other means of telecommunications, and these modern tools can help achieve their goals. But ultimately, more face-to-face interaction will be the great mover of minds. To that end, South Korea's young leaders have proposed a huge transport project linking Russia, China, South Korea and Japan. It could be the first step towards building a trading and negotiating force. Young leaders from China proposed that people-to-people exchanges be used to enable the region to get the most benefit from globalisation. Asians already send their brightest young people abroad to study; this approach would give this group of future leaders a network that promotes their growth into citizens of the region and the globe.

Meanwhile, on the economic level, the young leaders have recognised the need for progress on multilateral trade areas, like Asean plus three and "Asean plus India". They also recognise the need to avoid alienating their elders. While they do not shy away from criticising their ways, they also respect the wisdom that resides in the institutionalised powers.

Perhaps they know progress will not come faster if they are regarded solely as rebellious "young turks". As realists, who all have to work to make a living, they know that alienation achieves nothing and thus have reached out and made ties among those in power. In turn, the older generation needs to trust the young people's competence and give them a chance to prove their leadership. It is often the case that the old are wise, but tired and unwilling to accept change. As for the young, they may be energetic, but lack the experience required to lead. In other words, they need each other.

Some may call the New Asian Leaders dreamers, given the visions they have of a new Asia, but perhaps dreaming is what it takes. We should not forget that the European Union began with a "wild vision" about 20 years ago that eventually became the Maastricht Agreement. Asia may not need to build a regional bloc like the EU, but it certainly needs its own vision.

Frank-Jurgen Richter is director for Asia, Pamela Mar is associate director for China, and Thang Nguyen is regional manager for Asia, at the World Economic Forum. This is the first in a series of commentaries from the forum's New Asian Leader Network.

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