Asian governments urged to collaborate on aid fund
Asian governments should create a US$200 billion fund for recovery and development to help stricken regional economies pull out of their malaise, a former World Bank executive said.
Moeen Qureshi, chairman and managing partner of investment company Emerging Markets Corp and also former interim Prime Minister of Pakistan, said the fund should be used to assist in debt restructuring and to finance social safety nets.
'Multilateral institutions are performing an extremely valuable role but it is not enough,' he said at the Asia Society's annual conference.
'Their resources are neither sufficient, nor are they sufficiently adaptable to deal with the size and scope of the problems that Asian countries have to deal with.
'It is therefore, now [the] time for a bolder collective effort, and this effort should begin with Asian countries themselves.' Mr Qureshi said Japan was best suited to take the lead in organising the fund due to its capital and technology, but the mainland, Taiwan, and Singapore could also play key roles.
Japan had put forward a similar proposal for a $100 billion fund last year at the height of the financial crisis, but the idea gained little support.
Economists and officials cut down the plan, claiming it would allow Asian countries to avoid making tough economic reforms required by the International Monetary Fund.
Mr Qureshi said Japan's proposal was not clearly formulated and was widely misunderstood and misinterpreted.
He said the United States was unlikely to be a strong financial contributor to the fund but its involvement and that of the Asian Development Bank could have a strong catalytic effect.
Mr Qureshi said if the US was prepared to actively support the establishment of such a fund, it could then be fitted into an organisation such as Asia Pacific Economic Co-operation forum.
If Asian countries did not move boldly to forge new instruments for mutual support and co-operation, recovery within the region would be painfully slow, he said.
'It is a sad fact of our times that despite all the technological advances that we have achieved, we still live in the dark ages when it comes to collaboration among nations.'