Anwar warning on Asian growth
THERE is a danger that the rapid growth of the Asian economies in recent years may be taken for granted, warns Malaysia's Finance Minister Anwar Ibrahim.
Mr Anwar, who was delivering the keynote address at the Pacific Basin Economic Council (PBEC) meeting yesterday, said the rapid growth could not be sustained without continuous investment from both inside and outside the region.
He said: ''Fortunately, Asian countries are now fast realising the ideas of inter-linked economies.
''Growth triangles have multiplied and have become an effective mode of forging economic partnership and synergy between ASEAN [Association of Southeast Asian Nations] countries and our neighbours, generating growth to areas previously relegated to the periphery.'' Mr Anwar, who is also Deputy Prime Minister, said it was remarkable that many of the decisions to set up linkages no longer came from the highest levels of national leadership but from the provinces and the private sector.
Earlier in his speech, Mr Anwar said the realisation of the ''Asian renaissance'' was only beginning.
He said: ''The Pacific, as the sphere of partnership between the renewed East and America . . . is still largely to be constructed.
''The crucial task before us is to ensure its sustainability and the flowering of its potential, economics, and beyond economics.'' Asked to comment on Malaysia's economic outlook for the next five years, Mr Anwar said Malaysia was entering its seventh year of more than eight per cent growth and there was no need to be unduly worried that this could not be sustained.
He said first-quarter growth for this year was an ''extremely impressive'' 8.6 per cent.
Nevertheless, Mr Anwar cautioned that there was no room for ''waste, arrogance, contentment or complacency''.
Instead, he said the country must always be vigilant and ensure that economic growth could be sustained.
At the same time, he said the leadership had to ensure that, politically, growth was also sustainable, which meant taking care of the less fortunate such as by providing low-cost housing.
He said that to neglect the plight of the poor and allow poverty to exist in the midst of plenty was to ask for trouble.
Mr Anwar said Asian countries were still struggling to keep a tight rein on their economic fundamentals.
He urged them to fight against conventional economic wisdoms such as the assumption that inflation was inevitable and had to be tolerated to pursue growth policies.
Asian economies, he said, had allowed inflation to creep in and even to spiral in the name of growth.
''Anti-inflationary policies are often unpopular, thus it requires tremendous courage on the part of the government to institute monetary and fiscal measures to suppress inflation,'' he said.
Inflation in Malaysia was kept at 3.6 per cent last year, and although it hit four per cent in the first quarter this year, Mr Anwar said the government was determined to keep it below that figure.
''In Malaysia, we will be unrelenting in pursuing policies to ensure price stability,'' he said.
