NANNING, China -
More and more Chinese businesspeople are launching
and expanding their businesses in Southeast Asian
countries, counterbalancing previous capital flows
in an overwhelmingly single opposite direction,
officials and businessmen said at an ongoing
exposition.
Mochtar Riady, chairman of
Malaysia's renowned Lippo Group, said Chinese
businesses have accumulated an abundance of
capital in the economic boom over the past 30
years, leading to a strong desire to invest
overseas, while some member states of
the
10-member Association of Southeast Asian Nations
(ASEAN) wanted investment, especially in
infrastructure projects.
ASEAN will be
"the main destination of China's growing overseas
investment in future", the Chinese-Indonesian
billionaire said at the China-ASEAN Expo in
Nanning, which was due to close on Wednesday.
ASEAN member states have invested a total
of US$41.9 billion in China since the country
began it reform and opening up drive in late 1978,
according to statistics from the China's Ministry
of Commerce.
With China's fast
development, Chinese investment in ASEAN countries
increased rapidly in recent years. In a single
move at the exposition, China's Guangxi State
Farms Group alone inked 42 investment projects
with ASEAN enterprises, involving a total value of
19 billion yuan (US$2.5 billion).
So far,
more than 1,000 Chinese companies have made
investment in ASEAN member countries, mainly in
sectors such as agriculture, manufacturing,
mining, tourism, electricity and infrastructure
construction.
In the first two days of the
China-ASEAN Expo which opened on Sunday,
businesses from the two sides reached agreements
on 92 projects. Under the pacts, Chinese companies
will invest $1.19 billion in 37 projects in ASEAN
countries, while ASEAN businesses will put $2.81
billion in another 55 projects in China.
"Capital flow in both directions, rather
than the previous single-direction movement, has
emerged as a new trend within the China-ASEAN
cooperation," said Zhang Jian, a professor of
China-ASEAN studies at Guangxi Normal University.
China and ASEAN countries have been
pushing hard for the birth of the world's most
populous free trade area in the region targeted
for 2010.
Chinese Vice Premier Zeng Peiyan
has called on the two sides to expand investment
in both directions within the framework of
regional cooperation.
China and the ASEAN
are in talks over easier access for investors to
each other's market, and an agreement is expected
as early as next year, a spokesman for China's
Ministry of Commerce revealed.
At the
Expo, Chinese and Southeast Asian officials and
financial experts on Tuesday urged the countries
to strengthen financial cooperation, stressing it
is crucial to stability in countries, the region
and the world as a whole.
Ten years after
the financial crisis that swept Asia and crumbled
the results of development in many Asian
countries, especially those in Southeast Asia, to
dust, financial experts gathered in the south
China city of Nanning to discuss what should be
drawn from the "bloody lesson".
"We have
learned from the crisis that only by strengthening
financial cooperation can we ensure stability,"
said Ng Lip Yong, Malaysia's vice minister of
trade and industry, at a forum during the four-day
China-ASEAN Expo. "If we had had an effective
financial cooperation mechanism at that time, the
financial crisis might have been avoided," he
added.
Now it has become a consensus of
economists in China and Southeast Asian countries
to accelerate financial cooperation to meet the
demand for guarding against financial crisis and
establishing a free trade area covering China and
ASEAN members. China is not a ASEAN member
country, though it is part of the larger ASEAN
Regional Forum.
Under such circumstances,
dialogue on regional fiscal and financial policies
cooperation in institutional capacity building has
been strengthened, while leading financial
institutions have targeted other countries in the
region as their potential market.
However,
Bank of China's vice president Wang Yongli warned
it is a must to strengthen a country's financial
system and regulation. "Establishing a sound
financial system in a country could avoid
financial bubbles and risks from increasing to
some extent," Wang said.
Chartsiri
Sophonepanich, president of the Bangkok Bank,
Thailand, called for better management of capital
and foreign exchange reserves of ASEAN and China.
The China-ASEAN region has become one
experiencing the fastest economic growth in the
world, holding about half of the world's foreign
exchange reserve. "If we only rest on buying US
Treasury bonds with our foreign exchange reserve,
it will not bring any force to drive our economic
development," he said.
The Thai banker
suggested using foreign exchange reserves to
invest in the Asian bond market, which, together
with the establishment of an even wider regional
bond and financial market and effective regional
financial cooperation and coordination, could help
reduce the adverse impact of unpredictable
economic crises.
He also called for the
establishment of an Asia monetary organization to
facilitate trade and investment in the region.
Mochtar Riady, chairman of Indonesia's
Lippo Group, suggested taking the Chinese currency
as the basic currency for regional trade
cooperation and designing an Asia dollar based on
it.
Zhai Kun, senior Chinese researcher on
Southeast Asia studies, urged academic circles to
cooperate in the study of financial crises to be
able to make quick judgments and predictions
before a crisis arises.
However, financial
experts say, as China and ASEAN member countries
enhance financial regulation and participate in
international financial cooperation, their ability
to guard against and deal with crises has improved
markedly.
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