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					World Economic Forum on East Asia
Responding to New Uncertainties
Kuala Lumpur, Malaysia 15-16 June 2008




                                         Report
The views expressed in this publication do not
necessarily reflect those of the World Economic Forum.



World Economic Forum
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© 2008 World Economic Forum
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                                                REF: 020708
Contents


Page 3
Preface


Page 4
Summary: Responding to New Uncertainties


Page 8
Asian Leadership


Page 12
Global Risks


Page 16
Sustainable Growth


Page 20
Competitiveness


Page 24
Acknowledgements




                                           1 | World Economic Forum on East Asia
2 | World Economic Forum on East Asia
Preface




“Responding to New Uncertainties” was the theme of         Japan holds the G8 presidency and the economic
the 17th World Economic Forum on East Asia, which          influence of China and India continues to rise, the
was held in Kuala Lumpur. As such, 300 leaders from        need for a common agenda in East Asia to address
over 25 different countries examined and discussed         the key regional and global challenges is unequivocally
the challenges and priorities that will ultimately shape   pressing.
the region’s future agenda.
                                                           For these reasons, we hope you find the report of this
At the last World Economic Forum on East Asia,             year’s proceedings to be an insightful and timely guide
confidence in the resilience of Asia’s economies was       to how the region’s leaders can respond to these new
marked by positive economic growth forecasts,              uncertainties in the short term, but also which
expanding intra-regional trade, rising investments and     collective actions and innovative approaches by
staggering levels of US currency reserves. In this         governments, businesses and key regional institutions
context, leaders from Asia expressed their readiness       will be critical for dealing with these global and
to enlarge their leadership role in global and regional    regional challenges.
affairs as the centre of power shifts to Asia’s capitals
and corporate boardrooms.                                  The World Economic Forum would like to thank the
                                                           Co-Chairs of the meeting: Peter Brabeck-Letmathe,
Only one year later, the prospect of a US recession,       Chairman of the Board, Nestlé, Switzerland; Member
soaring food and fuel prices, and a downturn in global     of the Foundation Board of the World Economic
demand have led to concern about Asia’s ability to         Forum; Jamshyd N. Godrej, Chairman and Managing
decouple from the US sub-prime mortgage crisis,            Director, Godrej & Boyce, India; Takao Kusakari,
which is expected to lead to worldwide losses close        Chairman, Nippon Yusen Kabushiki Kaisha (NYK Line),
to US$ 945 billion. At the same time, the urgency to       Japan; Lord Levene, Chairman, Lloyd's, United
resolve the specific consequences of climate change,       Kingdom; and Ralph R. Peterson, Chairman and Chief
renewed tensions on the Korean Peninsula and               Executive Officer, CH2M HILL Companies, USA.
inflationary pressures are challenging the premise that
Asia’s healthy domestic consumption alone can
ensure continued growth and stave off the negative         W. Lee Howell                            Sushant Palakurthi Rao
externalities of a global economic slowdown. Although      Senior Director, Head of Programming     Director, Head of Asia
ASEAN now has an economic blueprint and charter,           Senior Adviser, Asia




                                                                            3 | World Economic Forum on East Asia
Summary: Responding to New Uncertainties




“We have faced serious challenges                           “Until very recently, East Asia was a
before, but rarely in such a potent                         follower of the global agenda but, for
combination.”                                               the first time, it is now a leader. The
                                                            world looks to the region to get it out of
Abdullah Ahmad Badawi, Prime Minister of Malaysia           the current financial crises.”

                                                            Peter Brabeck-Letmathe, Chairman of the Board, Nestlé,
                                                            Switzerland; Member of the Foundation Board of the World
At the 17th World Economic Forum on East Asia,              Economic Forum; Co-Chair of the World Economic Forum on
more than 300 business, government and civil society        East Asia
leaders from 25 countries arrived knowing that the
region is facing new uncertainties. While it remains
clear that the geopolitical and economic power
equation is shifting its direction, rising food and fuel    energy and the very real prospect of global economic
prices are raising the spectres of inflation and            recession. We have faced serious challenges before,
protectionism and, worst of all, the possibility that       but rarely in such potent combination.”
many Asians – who in recent years have scrambled
out of poverty – may again be forced back down. This        The World Economic Forum on East Asia offered an
could lead to social and political instability in several   excellent platform to discuss these difficult issues. As
countries in the region.                                    Ahn Ho-Young, Deputy Minister for Trade of the
                                                            Republic of Korea, put it, “the World Economic Forum
Indeed, these may be the best of times and the worst        is about turning challenges into opportunities.”
of times for East Asia. At the Welcome Reception for
participants, Malaysian Prime Minister Abdullah             That is precisely what participants aimed to do in
Ahmad Badawi hailed the region as full of “immense          Kuala Lumpur. It was evident from the interactive
promise and dynamism” with people who “brim with            discussions that East Asia’s leaders are responding to
entrepreneurial spirit and competitive drive”. But, he      the new uncertainties by taking a long-term view, not
warned, “the economic well-being of the region and,         panicking. A survey by the World Economic Forum
indeed, the world, is coming under increasing and           indicated that the business sector remains resolutely
serious threat. The threat is emanating from three          focused on the big picture and how Asia can
primary sources: rising food prices, spiralling costs of    contribute to securing and sustaining global growth,




4 | World Economic Forum on East Asia
peace and stability. An overwhelming 81% chose              “Things are moving so fast that
“addressing growing global concern over                     government cannot respond.”
environmental challenges such as climate change and
water” as their top priority among issues with potential
impact on Asia. Other choices included “preventing          Lam Di Don, Chief Executive Officer and Co-Founder,
political and economic instability linked to rising food    VinaCapital Group, Vietnam
and energy prices” and “managing the social,
environmental and infrastructural implications of rapid
urbanization”.

East Asia is at a crossroads in its role in the global      connect the people and government so that the
economy. “Until very recently, East Asia was a follower     complaints of ordinary people are heard,” said Huang
of the global agenda but, for the first time, it is now a   Xingguo, Mayor of Tianjin, People’s Republic of China.
leader,” explained Peter Brabeck-Letmathe, Chairman         “The best solution is transparency and openness.”
of the Board, Nestlé, Switzerland; Member of the
Foundation Board of the World Economic Forum; and           Concluded Jamshyd N. Godrej, Chairman and
Co-Chair of the World Economic Forum on East Asia.          Managing Director, Godrej & Boyce, India; Co-Chair of
“The world looks to this region to get it out of the        the World Economic Forum on East Asia: “It’s a
current financial crises.” While there is clearly some      problem of governance, not with the type of
ambivalence about Asia’s readiness to take up the           government you have.”
mantle, Asian leaders must step up to the challenge.
                                                            The World Economic Forum on East Asia was
The business sector must take the lead – especially in      organized under four sub-themes: Asian Leadership,
addressing pressing problems such as rising food and        Global Risks, Sustainable Growth and
energy prices that are generating discontent among          Competitiveness.
people. “We are closer to the people, while
government tends to lead and tell people what to do,”
said Lam Di Don, Chief Executive Officer and Co-
Founder, VinaCapital Group, Vietnam. The key to
responding to uncertainties is to provide effective
leadership in both the public and private sectors. “We
should always establish a very good mechanism to




                                                                               5 | World Economic Forum on East Asia
“This meeting is a good opportunity to                       “The mood today is more concerned
study what changes are happening in                          about food prices than protecting
the region and how we can collaborate                        farmers.”
to affect its politics and economics.”
                                                             Jamshyd N. Godrej, Chairman and Managing Director, Godrej &
Takao Kusakari, Chairman, Nippon Yusen Kabushiki Kaisha      Boyce, India; Co-Chair of the World Economic Forum on East
(NYK Line), Japan; Co-Chair of the World Economic Forum on   Asia
East Asia
                                                             Global Risks

Asian Leadership                                             Asia is facing three major global risks – inflation
                                                             resulting from soaring food and fuel prices, the rise of
Asian economic dynamism amid the faltering global            protectionism, and questions about security in the
economy has underscored how the centre of gravity            region.
of the global economy is shifting.
                                                             • The rise of inflation spurred by increases in fuel and
• While Asia’s voice and influence on the world stage          food prices could undo the economic progress that
  are increasing, the region remains under-                    the region has made since the financial crisis more
  represented in international institutions                    than a decade ago
• But the readiness of Asia to assume the mantle of          • Solving the food and energy problems will require
  global leadership is in question, given what some            concerted action among countries in the region and
  perceive to be weak leadership at the national and           cooperation between the region and the rest of the
  regional levels                                              world
• A key question is whether Asia has the capacity to         • Given the rising spectre of protectionism, the
  address the challenges posed by rising energy and            international community must refocus attention on
  food prices, as well as the issue of environmental           the Doha Round of global trade talks and the need
  degradation                                                  for the negotiations to be concluded quickly and
                                                               successfully
                                                             • East Asia must reflect on how the security
                                                               architecture of the region should develop. The
                                                               ASEAN Regional Forum could play an expanded
                                                               role as the main pan-Asian forum for discussions on
                                                               security issues with all the global players, including
                                                               the US, Europe and Russia

6 | World Economic Forum on East Asia
                                                                                                                           F
                                                                                                                           M
                  “I wish to examine together with you                                           “Multilateralism is still the priority. Asian
                  comprehensive and integrated                                                   countries feel that it is crucial to
                  responses to the issues of climate                                             complete the Doha negotiations. We
                  change, development, water, and food,                                          need to gain certainty.”
                  which are all mutually interlinked.”
                                                                                                 Mari Pangestu, Minister of Trade of Indonesia
                  Yasuo Fukuda, Prime Minister of Japan


                                                                                                 Competitiveness
                  Sustainable Growth
                                                                                                 Fast-growing Asia may be a “cushion” for the faltering
                  Concerns over food and fuel prices seemed to                                   global economy, but it has not yet become the fine-
                  overshadow long-term questions about sustainable                               tuned engine of growth that many may already
                  growth in Asia. Still, participants stressed the                               perceive it to be.
                  importance of addressing the challenges of climate
                  change and water scarcity.                                                     • The current global economic storms will be a major
                                                                                                   test for Asia’s economies
                  • Efforts to address the fuel and food crises must                             • The key question is whether Asian countries can
                    include both short-term measures and more long-                                continue to improve their competitiveness
                    term remedies to ensure sustainable growth                                   • Collaboration among governments and enterprises,
                  • As the continent gets wealthier, Asia must resolutely                          between the public and private sectors, and among
                    focus on the problem of the gradual depletion of its                           and within companies, is a key to boosting
                    resources, including water                                                     competitiveness. Collaboration in R&D increases
                  • To effectively address the challenge of sustainable                            advantages for Asian companies
                    management of resources to secure growth, the                                • The main challenge for government and business is
                    region must find collaborative solutions, including                            to improve governance standards and to constantly
                    public-private partnerships                                                    retool and reform
                  • Companies must embrace their social
                    responsibilities and the importance of engaging in
                    society on major global issues. Corporate
                    engagement in society is most effective when
                    aligned with the enterprise’s business proposition




                                                                                                                      7 | World Economic Forum on East Asia
From left to right: Jaime Morales Carazo, Vice-President of Nicaragua; Elias Antonio Saca, President of El Salvador; Patrick Manning, Prime
Minister of Trinidad and Tobago; Susan L. Segal, President and Chief Executive Officer, Council of the Americas, USA; Manuel Zelaya Rosales,
Asian Leadership




“If you’re travelling in Europe and the                       “The question is: Does Asia have the
US, there’s a feeling of doom and                             institutions, the leadership and the
gloom. Here, you step off the plane and                       inclusiveness to lead in the long run?”
it’s the opposite. This is the right place
to be at the moment.”                                         Azman Mokhtar, Managing Director, Khazanah Nasional,
                                                              Malaysia
Lord Levene, Chairman, Lloyd’s, United Kingdom; Co-Chair of
the World Economic Forum on East Asia



Asia’s dynamism is cushioning the global economy              That shift was most sensationally signalled when Asian
from a sharp slowdown brought about by the US sub-            and Middle Eastern sovereign wealth funds bailed out
prime crisis and Europe’s anaemic growth. Led by              Wall Street’s finest after they suffered multibillion dollar
China and India, the region is picking up the slack in        write-offs from derivatives trading and sub-prime and
global demand and staving off recession as it faces           real estate lending. The humiliating reversal of fortunes
strong headwinds of falling US import demand and              came just over a decade after the 1997-1998 Asian
rising food and fuel prices.                                  finance crisis unleashed a series of reforms across the
                                                              region aimed at improving corporate and
Taking particular note of Asia’s robustness, Lord             macroeconomic governance.
Levene, Chairman, Lloyd’s, United Kingdom; Co-Chair
of the World Economic Forum on East Asia, told                In keeping with its growing economic clout (see Figure
participants that the centre of economic gravity has          1), Asia has also been given a louder voice and
shifted dramatically. “If you’re travelling in Europe and     greater responsibility on the world stage. International
the US, there’s a feeling of doom and gloom. Here,            institutions of global governance such as the United
you step off the plane and it’s the opposite. This is the     Nations, the World Bank and the International
right place to be at the moment,” he said. In contrast,       Monetary Fund (IMF) have begun to place Asians at
a faltering US economy and the much-criticized US             the apex of their leadership. Today, a former South
military attack on Iraq have greatly discredited the          Korean foreign minister is the Secretary-General of the
country’s image, power and self-confidence. While the         UN; a former Hong Kong civil servant runs the World
US is widely expected to remain a dominant player in          Health Organization; a Japanese heads the United
world affairs, its recent problems and hubris are             Nations Educational, Scientific and Cultural
increasingly seen to have hastened the shift to a new         Organization; and a Chinese academic is the World
post-US world.                                                Bank’s chief economist. In addition, three Asian
                                                              countries – China, India and South Korea – have been

8 | World Economic Forum on East Asia
invited to the G8 Summit on climate change in                                                                                          “The global economic slowdown may
Hokkaido, Japan.                                                                                                                       inspire protectionism and the imposition
   Figure 1: East Asia's Share of the World Economy                                                                                    of regulations that would impede rather
                                        East Asia's increasing share of the world economy is not limited to China's forecast growth
                                                                                                                                       than support growth.”
                                   50
                                                                                                                            Forecast

                                                                                   G7 (x-Japan)
                                                                                                                                       Marcus Agius, Chairman, Barclays, United Kingdom
                                   40
   Percentage of world GDP (PPP)




                                   30



                                   20
                                                                                       Japan


                                   10                                                  China                                           a major regulatory failing in the US, the “IMF is
                                                                                 Rest of East Asia
                                                                                                                                       keeping quiet, doing nothing,” he charged. To be sure,
                                   0
                                        1980          1985           1990          1995              2000       2005          2010F    soaring commodity prices (see Figure 2), food and fuel
                                                                                                                                       in particular – rice, the staple food for 2.5 billion
   Source: International Monetary Fund, World Economic Outlook Database (April 2008)
                                                                                                                                       Asians, has more than tripled in price in Thailand since
                                                                                                                                       January, while diesel has risen over 26% in Vietnam –
But more needs to be done to convince many Asians                                                                                      are reinforcing the perception that present global
that the region’s representation within global governing                                                                               governance is inadequate. Marcus Agius, Chairman,
bodies is commensurate with its economic prowess.                                                                                      Barclays, United Kingdom, described the international
Consider the UN Security Council: its only permanent                                                                                   institutions as “pretty out of date”.
Asian representative is China, even though Asia claims
60% of the world’s population and generates one-third                                                                                     Figure 2: Commodity Prices

of global GDP. Europe, with just 11% of the global                                                                                                                                                      Prices for iron ore and rice rising as dramatically as oil

population, boasts three members. Then there is the                                                                                                                                  500
                                                                                                                                                                                                                                                                                    Oil**
rule that a European should occupy the top seat at
                                                                                                                                          Index of real prices* (100=January 2002)




                                                                                                                                                                                     400
the IMF, while the chief position at the World Bank is
reserved for an American.                                                                                                                                                            300
                                                                                                                                                                                                                                                            Iron
                                                                                                                                                                                                                                                             ore

                                                                                                                                                                                                                                                                         Soybeans
                                                                                                                                                                                     200
No wonder Yashwant Sinha, Member of Parliament;
                                                                                                                                                                                                                                                                                      Rice
Minister of External Affairs (2002-2004) and Minister of                                                                                                                             100


Finance of India (1998-2002), was sceptical. He
                                                                                                                                                                                      0
maintained that, had the sub-prime crisis originated in                                                                                                                                    Jan-02   Jan-03        Jan-04          Jan-05           Jan-06            Jan-07     Jan-08


Asia or Latin America, the IMF would have dispatched                                                                                       * Priced in US$; US-in ation adjusted prices with April 2008 as base month
                                                                                                                                           ** West Texas Intermediate Crude


“huge teams” there to order reforms. Yet in the face of                                                                                    Source: IMF; US Bureau of Labor Statistics; PwC analysis




                                                                                                                                                                                                         9 | World Economic Forum on East Asia
“Research is of paramount importance                        “In Japan, the government has been
when it comes to food and agriculture                       reforming for the last seven years, with
solutions.”                                                 or without a crisis, but it is also key to
                                                            look at reforms both on a short and
Musa Hitam, Chairman, Sime Darby, Malaysia                  long term basis.”

                                                            Yoriko Kawaguchi, Member of the House of Councillors,
                                                            Japan; Minister for Foreign Affairs of Japan (2002-2004).
Meanwhile, as Yasuchika Hasegawa, President,
Takeda Pharmaceutical Company, Japan, argued, it is
unfair to blame high-consuming developing nations in        deputy prime minister, said he, too, is not hopeful.
Asia for high energy prices and place more of the           ASEAN, for instance, has the capacity to tackle the
burden on them to deal with the problem of climate          food inflation problems in a collective and concerted
change. Asking developing economies such as China           manner but has not done so, despite much talk over
to shoulder more of the responsibility for reducing         the years of collaboration in agriculture, he pointed
carbon emissions is unfair when developed countries         out. Asian countries have to stop being insular if the
such as Japan and Germany produce more than three           region is ever to forge a shared agenda for tackling
times per head the CO2 levels, Hasegawa reckoned.           global uncertainties including energy, water and
                                                            environmental constraints, participants agreed.
Is Asia ready to assume the global mantle of
leadership? Can it? There are those who have their          Badawi issued a timely call for national and regional
doubts. “The question is: Does Asia have the                action: “Many of us have instituted measures we
institutions, the leadership and the inclusiveness to       consider in the best interests of our economies and
lead in the long run?” Azman Mokhtar, Managing              our people. But it is too evident that these measures
Director, Khazanah Nasional, Malaysia, asked. He is         will only have limited impact as food and fuel prices
not sanguine. “We don’t see it,” Azman said. “There is      continue to soar while the global economy is on the
a lack of leadership in the national and regional levels,   verge of a recession.” For now, Asia’s insatiable
much less at the global level.”                             appetite for consumer goods and the abundance of
                                                            investment opportunities will ensure that the region
Citing the track record of ASEAN, the region’s most         remains the locomotive for the world economy.
established multilateral grouping, Musa Hitam,
Chairman, Sime Darby, Malaysia, a former Malaysian




10 | World Economic Forum on East Asia
Governments’ Role in Fuel and Food Hikes

Business leaders at the World Economic Forum on East      Other factors driving up food prices include inadequate
Asia highlighted the role of government in food price     investments in infrastructure, particularly in developing
increases, warning of mounting unrest and                 countries like Indonesia, resulting in higher logistical
protectionism if urgent action is not taken.              costs, and in research and development. Musa Hitam,
                                                          Chairman, Sime Darby, Malaysia, called on ASEAN to
Peter Brabeck-Letmathe, Chairman of the Board,            act collectively in search of long-term solutions rather
Nestlé, Switzerland; Member of the Foundation Board       than knee-jerk reactions.
of the World Economic Forum; Co-Chair of the World
Economic Forum on East Asia, attributed two-thirds of     Michael J. Roux, Chairman, Roux International,
the food price rises to government decisions. He said:    Australia, said the issue of food price increase should
“About 10% of food price increase can be due to the       be treated separately from the fuel crisis, noting that
increase in fuel, 10% from changes in lifestyle … about   factors supporting the oil price increase are less
one-third of the price increase, we will give it to the   sustainable. He said he believes that the oil price would
decision to use food for biofuels … and about one-third   collapse if the US goes into a recession.
to political decisions to stop exports … and 10% from
speculators.”                                             Some participants felt reform is needed in structuring
                                                          incentives to influence energy consumption behaviour,
Government subsidies, which have long distorted           for example, lifting fuel subsidies that have led to price
agricultural prices, keep food issues political.          distortions.




                                                                            11 | World Economic Forum on East Asia
Global Risks




“The food crisis is an affordability – not                   “We are in the same boat; we share the
an availability – problem.”                                  same destiny. We should not fall into
                                                             the trap of protectionism but should
Rajat M. Nag, Managing Director-General, Asian Development   help each other.”
Bank, Manila
                                                             Yoshimi Watanabe, Minister of Financial Services and
                                                             Administrative Reform of Japan




Words of one Asian minister at last year’s World             Nag also warned that Asia’s “good growth story” is
Economic Forum on East Asia proved to be prophetic           under threat if swift government response is not
when he warned, “It’s precisely because everyone’s           forthcoming in the form of tightened monetary and
feeling good that we know something is coming.” The          fiscal policies. However, noted one panellist, raising
Asian landscape then was brimming with optimism.             interest rates may not arrest rising prices, especially if
Interest rates and inflation were low, companies were        inflation is not generalized and limited to food and
enjoying booming profits and governments were                energy.
reporting healthy tax takings. Fast forward a year –
and that upbeat sentiment has given way to deep              Leaving aside the debate on monetary policy, there
anxiety.                                                     was agreement that governments should intervene
                                                             quickly by giving targeted support to the poor –
With soaring food and fuel prices, regional equity           hardest hit by rising prices (see Figure 1). According to
markets rapped by the unwinding sub-prime crisis             some estimates, about 100 million people have
and threat of a global economic downturn, the mood           descended into poverty worldwide in the wake of this
at this year’s World Economic Forum on East Asia             crisis. Low and middle income groups are feeling the
was predictably sombre. Inflation was understandably         strain.
foremost on the minds of participants. Rajat M. Nag,
Managing Director-General, Asian Development Bank,
Manila, called it an issue of grave concern. He
predicted inflation for the region would surpass the
ADB’s April forecast of 5.1% for the year.




12 | World Economic Forum on East Asia
                                                                                                                                   “Given the deep integration of the
    Figure 1: Rising Food Prices, Unequal Impacts
                                                                                                                                   global economy, the slowdown is
   (food weighting within consumer price index, percent)
    80                                                                                                                             having a great impact on our
                                         Bangladesh
    70
                  Nigeria
                                                                                                                                   economies. We in Asia should work
    60

    50            Afganistan
                                                                                                                                   together to find solutions.”
    40
                             Kenya                                                                       Russia                    Vu Van Ninh, Minister of Finance of Vietnam
    30

    20

    10                                    India         China        Brazil
                                                                                          UK                  US
      0
          0              1               2            3         4         5                             6               7      8
                                                 Per capita income (in log)
                                                                                                                                   back on old tools” such as authoritarian measures to
                                                                                                                                   squelch protests.
   Note: Poor people tend to spend relatively more of their income on food, and therefore su er more when food prices go up.
   Source: International Monetary Fund



                                                                                                                                   Asian governments, some participants pointed out,
Participants concurred that solving the food problem                                                                               need to rethink existing policies in view of current
will require concerted action within Asia and between                                                                              realities – notably fuel subsidies, which have led to
the region and rest of the world. Food surplus nations                                                                             price distortions and unbridled energy consumption.
need to put collective interests above national ones by                                                                            However, it is a task that requires tremendous political
releasing their stockpiles to those facing shortages.                                                                              resolve as governments face the conundrum of
International aid is also urgently required to                                                                                     balancing the total or gradual removal of an
supplement national rescue efforts aimed at easing                                                                                 unsustainable policy that threatens to further stoke
the suffering of those most affected.                                                                                              inflation with the political costs of doing so.

While solutions are being deliberated, simmering                                                                                   In the longer term, reform is needed to address the
tension over the hike in food and fuel prices has                                                                                  deeper issue of the energy crisis – excessive
meanwhile led to mass protests reminiscent of riots in                                                                             dependence on fossil fuels. One panellist said that it is
the immediate aftermath of the Asian financial crisis.                                                                             time for Asian governments to seriously consider
Inflation has morphed into a political risk, testing the                                                                           diversifying their energy mix to include hydro-
mettle of several regimes in the region. “Things are                                                                               electricity, solar and wind power, fuel derived from
moving so fast that government cannot respond,”                                                                                    biomass and – albeit controversial – even nuclear
warned Lam Di Don, Chief Executive Officer and Co-                                                                                 energy.
Founder, VinaCapital Group, Vietnam. “If government
doesn’t come out with new solutions, they will fall


                                                                                                                                                     13 | World Economic Forum on East Asia
   Yasuchika Hasegawa, President, Takeda Pharmaceutical Company, Japan; Lord Levene, Chairman,
   Lloyd's, United Kingdom; Co-Chair of the World Economic Forum on East Asia; Rajat M. Nag, Managing
   Director-General, Asian Development Bank, Manila; and Ralph R. Peterson, Chairman and Chief Executive
   Officer, CH2M HILL Companies, USA; Co-Chair of the World Economic Forum on East Asia




Another looming global risk is the rise of                        that, if no breakthrough is achieved at the negotiations
protectionism. There are worrying signs that politicians          before the US presidential elections in November, free
in Europe and the United States are prepared to                   trade and other global endeavours will suffer a
introduce policies to shield their domestic industries in         setback that will stall progress for years. Lamented
view of the global economic slowdown, observed                    one panellist: “How can we envisage collaborating on
several participants. Sharply critical of politicians who         critical issues such as climate change and poverty if
pander to their electorate, meeting Co-Chair Lord                 we cannot collaborate on Doha?” In the meantime,
Levene cautioned Western developed economies that                 Asian countries are certainly collaborating together,
erecting protectionist barriers would backfire. “If you           with intra-Asian trade growing faster than trade
go to any Wal-Mart store in the US, about 60% to                  between Asia and the rest of the world (see Figure 2).
80% of everything is made in China. If you cut off all
that manufacturing and say you are going to produce                   Figure 2: Trade within Asia

these things domestically, the cost will go up to levels                                                                      Exports within developing Asia represent a growing
                                                                                                                                   share of all exports from developing Asia
such that the public – which enjoys a high standard of                                                        45%

living now – will not be able to buy these things
                                                                      Intra-Asia exports as a percentage of




anymore.”
                                                                        all exports from developing Asia*




                                                                                                               43




Agreeing on the need to keep free trade alive, Ralph                                                           41

R. Peterson, Chairman and Chief Executive Officer,
CH2M HILL Companies, USA; Co-Chair of the World                                                                39


Economic Forum on East Asia, said protectionism is
an enormous risk and its pursuit will be tragic. He                                                            37
                                                                                                                    1999   2000       2001         2002          2003         2004   2005   2006

added that a retreat from a liberal trade regime is a                 * Excludes Japan



grave danger to the world. Another participant issued                 Source: IMF Direction of Trade Statistics


a dire warning: the ingredients are there for a trade
war to break out. “What will we be celebrating in                 Security in the region was yet another concern vexing
2019?” he asked. “Are we going to be looking at the               participants. The United States’ heavy involvement in
opportunities that this fantastic era of globalization has        Iraq and Afghanistan in recent years has raised doubts
brought about or are we going to be reflecting on the             over its commitment to East Asia. Coupled with the
ashes of World War Three?”                                        rise of China and India, the region faces an emerging
                                                                  security dilemma that may potentially threaten its
The rising threat of protectionism has refocused                  prosperity. What should replace a US-centric security
attention on the outcome of the Doha Round of global              architecture if it is deemed irrelevant in a multipolar
trade talks. Many participants shared the concern                 world order?


14 | World Economic Forum on East Asia
The Systemic Financial Risks ahead for Asia


The international credit drought created by the US sub-
prime meltdown has challenged the underlying risk
management models of both central bankers and industry
executives.

While there has not been a decoupling of Asian and US
financial markets as a result of the interconnectedness of
financial systems, the current financial turmoil does not pose
systemic risks to countries in East Asia. This was the
unanimous assessment of panellists in a session on financial
risk, including Shaukat Aziz, Prime Minister of Pakistan,
(2004-2007); Nobuyoshi John Ehara, Partner and
Representative Director, Unison Capital, Japan; Benjamin
Jenkins, Senior Managing Director, Blackstone Group, Hong
Kong SAR; and Zeti Akhtar Aziz, Governor, Bank Negara
Malaysia, Malaysia.                                                  Zeti Akhtar Aziz, Governor, Bank Negara Malaysia, Malaysia


They pointed out the need to differentiate between capital           Participants voiced their belief that, a year from now, Asia
markets and the real economy. While Asian countries have             will remain the fastest-growing region in the world because
seen a dent in their equity markets in tandem with the fall in       of its resilience in absorbing the shocks from the current
US stock markets, most Asian economies are still recording           financial crisis, its talented pool of human capital,
good growth, unlike their Western counterparts.                      competitiveness relative to other parts of the world, and
                                                                     political stability.
Summing up the sentiment of most of the panellists, one
participant said: “When we faced the financial crisis 10 years       Turning to the issue of inflation, most of the panellists agreed
ago, all analysts and the IMF said we would have a lost              that it is a threat that must be addressed immediately as the
decade. But there was a quick resumption of growth for               situation is fermenting social unrest. However, they were
most countries in the region. That is due to the flexibility of      cognizant of the difficulty Asian governments face in
Asian economies, which were able to bounce back in a                 balancing the seemingly conflicting interests of monetary
short space of time. Therefore, in the current environment, if       policy and economic growth.
we strip away the contagion effect from the sub-prime crisis
and look at the economies, I’m optimistic.”




At a panel discussion on the issue, participants were             Even the US, one panellist noted, is gradually
confident that US troops are not likely to significantly          changing its mindset and has come to realize that
reduce their troop presence in Asia. Even in the event            military force itself does not guarantee security in Asia.
of a diminished US military role in the region, most              He observed that the US is increasingly more
were optimistic that closer ties between China and                supportive of using regional forums to deal with
Taiwan will offset the reduced presence. Cross-strait             security issues (e.g. its recent appointment of a
relations recently improved when both sides signed a              permanent ambassador to ASEAN). Some
pact to improve economic and cultural links. Better               participants suggested that the ASEAN Regional
relations further north are also helping to lessen                Forum (ARF) play this prime role. They proposed that
tensions. Beijing and Tokyo have just concluded a                 the ARF should be expanded to create a pan-Asian
landmark deal to set aside a territorial dispute and              dialogue and added that the US, Europe and Russia
jointly develop natural gas fields in the East China Sea.         should not be left out of this expanded forum.

Most panellists favoured having a less formal
multilateral security arrangement over a new regional
military alliance. They noted that ad hoc and less
institutional arrangements have served the region well
and cooperation should continue in this less rigid
format, citing the six-party talks on North Korea and
collaboration among the navies of the US, Australia,
India and Japan during the Asian tsunami crisis as
examples of success.

                                                                                   15 | World Economic Forum on East Asia
Sustainable Growth




“Governments should take the short-                          across Asia in recent months. The morning Ahn spoke
term pressures and challenges and turn                       at a panel session, the front page of a Korean
                                                             newspaper carried a photograph of more than 5,000
them into opportunities, such as                             truck drivers striking in South Korea, demanding that
seeking alternative fuel resources and                       the government increase subsidies for fuel, authorize
increasing efficiency in oil and food                        higher freight charges and introduce a minimum wage.
consumption.”
                                                             Demonstrations were also held in Indonesia, Malaysia,
                                                             India, Thailand, Myanmar, Hong Kong and Nepal,
Ahn Ho-Young, Deputy Minister for Trade of the Republic of   where prices of daily necessities like rice, corn,
Korea                                                        soybeans, cooking oil, kerosene and gasoline have
                                                             surged. Governments have been forced into quick-fix
An overwhelming 81% of business leaders responding           actions including reductions in import tariffs on
to a World Economic Forum survey voted for                   agriculture products, cash rebates on petrol and diesel
“addressing growing global concern over                      and incentives for farmers to increase productivity.
environmental challenges such as climate change and
water” as the top choice of issues with the greatest         Fuel subsidies are common in Asia’s developing
impact on Asia.                                              countries – they account for 2% of India’s GDP and
                                                             30% of Indonesia’s budget. Governments risk
Other major concerns included “preventing political          fomenting political unrest if they raise prices or cut
and economic instability linked to rising food and           subsidies, as those affected are mainly poor people
energy prices” and “managing the social,                     who spend the bulk of their earnings on food and
environmental and infrastructural implications of rapid      transport. Last year’s mass protest in Myanmar – the
urbanization”.                                               country’s largest in 20 years – and the resulting
                                                             military crackdown followed announcements by the
Notwithstanding, at the World Economic Forum on              government of hikes in gasoline and diesel prices.
East Asia, climate change and water were somewhat
sidelined by the clear and present danger of spiralling      Mari Pangestu, Minister of Trade of Indonesia, said her
food and fuel prices.                                        government responded to the global shock of rising
                                                             food and fuel prices by lowering tariffs related to
Food, fuel and finance, or the “Three Fs”, as Ahn Ho-        agriculture products. It tries not to control fuel prices,
Young, Deputy Minister for Trade of the Republic of          which have increased by 30%, preferring to let
Korea, put it, were hot topics as rising prices have         domestic prices adjust as gradually as possible. At the
stoked public anger and sparked demonstrations               same time, the government aims to ease the burden


16 | World Economic Forum on East Asia
of rising food prices by giving incentives to farmers to   “Water systems are so Balkanized [that]
expand production, especially of crops that can be         it’s difficult to get a comprehensive view
harvested quickly.
                                                           of how to use the resources efficiently.”
In South Korea, the government introduced a US$ 10
billion programme of short- and long-term solutions to     Ralph R. Peterson, Chairman and Chief Executive Officer,
benefit small enterprises and low-income workers.          CH2M HILL Companies, USA; Co-Chair of the World Economic
“This is a clarion call for us to reduce our dependence    Forum on East Asia
on foreign oil,” said Ahn.

Inflation aside, the falling US dollar is also adding to   Asian companies need to find innovative ways to get
Asia’s economic woes. The faltering currency is            around resource constraints and infrastructure
making locally manufactured goods relatively more          bottlenecks. Solutions could include telecommuting
expensive in dollar terms and, coupled with the sharp      and the creation of smaller urban centres. Some
slowdown in the US economy, is threatening to              participants argued that mounting urbanization would
undermine Asia’s much-vaunted export power. Day to         lead to more pressure for democracy, which Asian
day, currency volatility is hampering the ability of       governments may not be able to ignore. Local
businesses to run their operations and plan strategy.      governments could become more powerful engines of
Exports have held up so far, thanks to gains in Asian      change than central governments.
productivity and growing intra-regional trade. Whether
                                                              Figure 1: Water Rates Around the World
the strengthening of Asian currencies is a long-term
phenomenon remains to be seen.                                                                         Water tari s across Asia are lower than in other developing countries


                                                                                            $1.25

Also straining resources is the growing urbanization of
Asia resulting from rural-urban migration. This has also                                     1.00
                                                              Average water tari (US$/kl)




widened the gaps in infrastructure and skilled human                                          .75

capital in many of the region’s economies. Participants
                                                                                              .50
debated whether the private or public sector should
take the lead, or whether public-private partnerships                                         .25

should be the main catalysts for change. Explosive
                                                                                               0
growth has outpaced the capacity of institutions to                                                 OECD       Latin America     Middle East       East Asia       Eastern and    South Asia
                                                                                                                Caribbean        North Africa       Paci c         Central Asia
supply skills.
                                                              Source: World Bank, 2005




                                                                                                             17 | World Economic Forum on East Asia
   Klaus Schwab, Founder and Executive Chairman, World Economic Forum; Takao Kusakari, Chairman,
   Nippon Yusen Kabushiki Kaisha (NYK Line), Japan; Co-Chair of the World Economic Forum on East Asia;
   Lee Bill Byunghoon, Chairman and Chief Executive Officer, Univera, Republic of Korea; and Yoshitaka
   Kitao, Representative Director and Chief Executive Officer, SBI Holdings, Japan




Another pressing long-term concern is the gradual                 sustainable growth. Many are realizing that regional
depletion of Asia’s resources, including water. Over-             and international agendas are increasingly forming
exploitation, excessively low tariffs (see Figure 1), rapid       around universal issues, and environment-related
urbanization, industrial pollution and climate change             problems such as sustainable resources and health
have exacted a heavy toll on this precious resource.              affect all countries and, consequently, all businesses.
Growing affluence in China and India have also led to
a higher meat diet, which requires 10 times more                  Corporate engagement can take five forms: corporate
water than a vegetarian diet. Co-Chair Brabeck-                   governance, corporate philanthropy, corporate social
Letmathe did not mince words when he repeated this                responsibility (CSR), social entrepreneurship and
warning: “We will be running out of water long before             corporate global citizenship.
we run out of oil.” He lamented that more of the                  Corporate global citizenship and CSR are distinct but
world’s GDP has been devoted to the climate change                interlinked. CSR programmes often include incentives
issue and not enough resources allocated to water.                to promote the environment. Companies can
“One out of every five children is dying every 20                 encourage fuel savings, sustainable farming and clean
seconds because we haven’t been able to solve the                 air with a variety of financing incentives and
problem of clean water today,” said Brabeck-                      technological innovation. Japanese shipping line
Letmathe.                                                         Nippon Yusen Kabushiki Kaisha (NYK Line), for
                                                                  example, has cut its fuel bill by 9% by taking
Meeting Co-Chair Peterson called for more political               advantage of sea currents to help its vessels sail.
and institutional collaboration, saying that the water
systems are “so Balkanized [that] it’s difficult to get a         Corporate global citizenship and CSR activities are
comprehensive view of how to use the resources                    most effective when aligned with a corporation’s own
efficiently.” He noted that water is not free and the             unique resources. Goodyear Tire Management
sooner market forces are applied to the pricing of                Company (Shanghai), for example, conducts free
water, the better. A more realistic pricing would                 inspections for cars in China and researches the
minimize leakage and act as a deterrent to wastage.               potential use of new materials, such as corn, to make
Water tariffs across Asia are among the lowest in the             tyres. By becoming more aware of how
world.                                                            interconnected the world and its trading systems have
                                                                  become, Asian enterprises are slowly but surely
The issue of water, like climate change, is gaining               stepping up to their responsibilities of being good
more awareness as Asian corporations consider their               global corporate citizens.
social responsibilities in championing the cause of




18 | World Economic Forum on East Asia
                                                              “We will be running out of water long before
                                                              we run out of oil.”

                                                              Peter Brabeck-Letmathe, Chairman of the Board, Nestlé,
                                                              Switzerland; Member of the Foundation Board of the World Economic
                                                              Forum; Co-Chair of the World Economic Forum on East Asia




Managing Asia’s Most Valuable Resource

Rapid urbanization, industrialization, changing diets and     Water should be viewed on a more multidimensional
climate change are aggravating the effects of                 scale, because it is interconnected with issues like
unsustainable water use in Asia.                              climate change and other global problems. This would
                                                              help overcome constraints developed countries
The first issue is lack of awareness by most countries        experience when devoting resources to water
and policy-makers of the urgency and scale of the             separately.
impending global water crisis.
                                                              Water pricing was a favoured measure among leaders
People expect water to be available and inexpensive,          at the World Economic Forum on East Asia in Kuala
but don’t realize that, like oil, it is a scarce commodity.   Lumpur. One suggested providing a minimum level to
There is also a need to create greater awareness of the       meet “human rights” requirements free of charge, and
use of water for agriculture, which normally uses the         pricing upwards to encourage proper usage.
largest proportion of the supply.
                                                              Finally, more research is needed to produce hard-hitting
The second issue is fixing the problems in developing         facts and figures to convey the severity of the problem.
countries. One-third of the world still does not have
access to clean water despite technological advances
and assistance from developed countries. In fact,
whether run by the public or private sector, water
leakage and pollution continue to plague both
developed and developing countries. While water
supply in most countries is managed mostly by the
public sector, there is no clear consensus as to who
can do a better job in preventing such problems.




                                                                                 19 | World Economic Forum on East Asia
Competitiveness




With the downturn in the US and the resulting              “Economic globalization and regional
slowdown in the global economy, Asia’s economies,          integration will further promote
particularly the fast-growing giants China and India,
have been recognized for providing a “cushion” for the
                                                           cooperation among Asian countries and
rest of the world. “In the short run, Asia will take up    Asia will be the most dynamic region
the slack,” said Azman Mokhtar, Managing Director,         and backbone of the world economy.”
Khazanah Nasional, the investment holding arm of the
Malaysian government. This is a significant turnaround     Huang Xingguo, Mayor ot Tianjin, People's Republic of China
from 1997-1998, when a financial crisis hobbled East
Asia and pushed many of the region’s economies into
recession, wiping out significant wealth and pushing
many people back into poverty.
                                                           Indeed, with the storms in the global economy and
This has certainly heightened the perception that the      high energy and food prices raising uncertainties
global economic centre of gravity is inexorably shifting   about the benefits of globalization, “the question is
to Asia. Days after the meeting in Kuala Lumpur            whether Asia can maintain its growth momentum
ended, the news that Hong Kong and Singapore took          against strong headwinds,” said Børge Brende,
the top two positions in the Enabling Trade Index          Managing Director, World Economic Forum. Certainly,
ranking released by the World Economic Forum               there is cause for concern that some Asian economies
served as further evidence of East Asia’s economic         are in trouble. “Given the deep integration of the
strength and openness to trade and investment.             global economy, the slowdown is having a great
                                                           impact on our economies,” Vu Van Ninh, Minister of
But it is important to maintain perspective. While East    Finance of Vietnam, explained. “Vietnam is being
Asian growth may be strong and its economies are           impacted especially by high inflation. We in Asia
certainly in better condition and more resilient than      should work together to find solutions.”
they were a decade ago when the financial crisis hit,
most of the region’s economies are not as competitive      Implicit in Brende’s observation is a warning that Asian
as they may be perceived. Only Singapore, at number        economies cannot be complacent and must focus on
seven, ranked in the top 10 on the World Economic          improving productivity and boosting competitiveness if
Forum’s 2007-2008 Global Competitiveness Index.            they are to become an authentic and sustainable
Other top East Asian performers included South Korea       driver of growth in the world economy and not just a
(11), Hong Kong SAR (12) and Taiwan, China (14). The       reliable “cushion”. As Vu pointed out, the way to find
People’s Republic of China, meanwhile, ranked 34th,        solutions is to collaborate. Reckoned Yoshimi
while India was 48th. Cambodia came in at 110.             Watanabe, Minister of Financial Services and


20 | World Economic Forum on East Asia
“The international institutions we have                            collaboration and the forming of partnerships.
at the moment are woefully inadequate                              Consider the plaintive question of one participant: “Do
                                                                   we need to replicate everything?” He wondered aloud
to meet the global challenges. If we are                           whether it makes sense for neighbouring countries to
providing the bulk of the incremental                              build airports and seaports so close to each other.
growth globally, we Asian nations have                             National pride and the drive to preserve one’s turf
a vested and immediate interest in                                 have, in many instances, stifled logic and the
                                                                   understanding that collaboration can make everyone
making sure that the global institutions                           more competitive and result in win-win solutions.
respond to the global crisis as they                               Politics and competing motives have impeded the
should.”                                                           creation of effective public-private partnerships, which
                                                                   today are regarded as critical to development
Yashwant Sinha, Member of Parliament; Minister of External         success.
Affairs (2002-2004) and Minister of Finance of India (1998-2002)
                                                                   But all this is changing in Asia, however gradually.
                                                                   Governments are starting to collaborate on critical
Administrative Reform of Japan: “We are in the same                issues including financial market stability, energy
boat; we share the same destiny.”                                  security and the environment. But the level of
                                                                   cooperation, despite the ambitions of ASEAN, remains
A paradoxical principle for success in the global                  low. Corporations are also cooperating – enterprises
economy is that collaboration can enhance                          with suppliers, partner with partner, and even
competitiveness. Faced with the emergence of China                 competitor with competitor. Collaborators must
and India, the 10 nations of South-East Asia have                  understand how the other business works. For a
come to understand and accept that they must                       successful venture, it is important to understand the
collaborate and aim to create a European Union-style               “psyche” of the organization, and have a shared
community if they are to remain competitive and                    vision, aspiration and culture. As in a marriage, both
relevant in the global economic landscape. But                     sides have to work to make the relationship prosper.
creating the political and commercial will to embrace
such an enterprise has been difficult.                             There is further cause for optimism on the research
                                                                   and development front. In the session entitled The
In Asian economies, many participants observed,                    Myths and Realities of the R&D Advantage, panellists
governments or major family-owned corporations with                provided insights into how Asia is emerging as a major
vested interests control much of the value. National               hotbed of research and development, which has led
interests and protectionist tendencies have limited                to the rise in innovation – the transformation of ideas


                                                                                   21 | World Economic Forum on East Asia
                 Kishore Mahbubani, Dean, Lee Kuan Yew School of Public Policy, Singapore




into commercial value – coming out of the region in                                                                                              Indeed, the globalization of best practices, if
recent years. India and China are increasing their R&D                                                                                           embraced by the region, is likely to be Asia’s trump
spending by over 25% per year (see Figure 1). Moves                                                                                              card – the way in which it finally transforms its
like these are correcting perceptions that Asia’s main                                                                                           governments and companies into flexible and
advantage is its pool of cheap labour.                                                                                                           innovative institutions and competitive enterprises
                                                                                                                                                 such as Japan’s Toyota. The automotive giant has
                                                                                                                                                 proven that collaboration within the group is integral to
  Figure 1: Worldwide R&D Spending                                                                                                               its success and a sense of community enhances the
                                                      R&D spending in China and India is growing rapidly, but from a small base                  effectiveness and cooperation of employees and
                                           0.4%
                                                                                                                                                 suppliers.
                                                                                                    North America
   Change in R&D intensity, 2005-06 (R&D
   spending as a percentage of revenues)




                                                                                                       $194.2
                                            0.2
                                                                                                                                                 In short, governance in both the private and public
                                                                                                                             India/China
                                                                                                                                 $2.1            sectors must be improved if Asia is to transcend from
                                             0
                                                       Japan
                                                       $96.3                                                                                     “cushion” to fine-tuned “engine” of competitiveness. In
                                                                                   Europe
                                                                                   $132.6
                                                                                                                                                 the session on Delivering a Governance Dividend for
                                           -0.2

                                                                          Rest of World
                                                                                                                                                 Asia, Shaukat Aziz, Prime Minister of Pakistan (2004-
                                                                              $21.4

                                           -0.4
                                                                                                                                                 2007), provided a template for a new paradigm of
                                                  0              5             10             15            20
                                                                           One year growth in R&D spend, 2005-06
                                                                                                                                  25       30%
                                                                                                                                                 governance that emphasizes delivery and substance.
   Note: Size of circle represents relative size of R&D spend, 2006. All gures in US$, billions                                                  Governments, he stressed, need to retool and reform
   Source: Booz & Company’s Global Innovation 1000 study
                                                                                                                                                 at all levels to quickly meet new challenges such as
                                                                                                                                                 the food and energy crises. Strong leadership at the
In the discussion, panellists focused on how                                                                                                     top is essential, with those in authority taking pre-
collaborative efforts within enterprises and among                                                                                               emptive measures to head off problems, rather than
companies have yielded significant opportunities for                                                                                             simply reacting to events. “Things move so fast,”
“research arbitrage” and boosted the productivity of                                                                                             warned Aziz, who could well have been speaking
enterprises in such sectors as pharmaceuticals,                                                                                                  about the business sector too. “You have got to apply
healthcare, manufacturing and IT. In addition, the                                                                                               new solutions to deal with new challenges that
shortage of talent – not just skilled managers but for                                                                                           emerge. To do that, you need proactive government,
technical specialists such as engineers and workers                                                                                              strong leadership and a bureaucracy that will support
with vocational skills – means that business and                                                                                                 change. You need a total shift in thinking.”
government must work together to enhance the
quality of educational institutions from the primary level
upwards.




22 | World Economic Forum on East Asia
Competitiveness in East Asia

The general perception is that Asians are not just         In this sense, can one prioritize the key factors on which
competitive; they are hyper-competitive. But is this       countries in the region should focus to become more
perception representative? The truth draws a more          competitive? Innovation and business sophistication is
nuanced picture as the region encompasses a large          crucial for the top-tier countries; improving the quality of
range of competitiveness performances, from highly         human capital and market efficiency provides a basis for
competitive countries to those among the most              development and growth for the middle ranking
challenged. This provides an extremely heterogeneous       countries; and factors such as improving basic
picture with respect to the levels of economic growth      education, health systems and infrastructure are critical
and prosperity achieved in the region.                     for the lowest-ranked economies.

In The Global Competitiveness Report 2007-2008, nine       The World Economic Forum on East Asia addressed, in
Asia Pacific countries are among the top 30 in the index   its various sessions, the drivers of economic
rankings, led by Singapore, Japan, South Korea and         development and, more specifically, held a discussion
Hong Kong. The countries in the next tier are among        on identifying best practices in competitiveness. The
the largest markets in the region, led by China and        session highlighted a need for a solid macroeconomic
India. A number of smaller economies close the ranking     architecture including strong and transparent
for the region, with Mongolia, Bangladesh, Cambodia,       governance, public-private sector alignment, an efficient
Nepal and Timor-Leste all positioned at the very           business infrastructure, openness to international trade
bottom.                                                    and investment, among other factors.




                                                                             23 | World Economic Forum on East Asia
Acknowledgements



The World Economic Forum on East Asia is held with the support of the Institute of Strategic and International
Studies (ISIS) Malaysia.

The World Economic Forum wishes to recognize the support of the following companies as Partners or
Supporters of the World Economic Forum on East Asia:




Strategic Partners

American International Group (AIG)
Bain & Company
Barclays PLC
Credit Suisse
Forbes
Kudelski Group
Manpower
Marsh & McLennan Companies (MMC)
NBC Universal
Nestlé
SK Group
Unilever
WPP
Zurich Financial Services



Regional Partner

Sicpa Holding



Meeting Supporters

Lloyd’s
Ogilvy Public Relations Worldwide
Sime Darby




24 | World Economic Forum on East Asia
25 | World Economic Forum on East Asia
Contributors




Sushant Palakurthi Rao is Director, Head of Asia, at the World Economic Forum. W. Lee Howell
is Senior Director, Head of Programming, and Senior Adviser, Asia, at the Forum. The World
Economic Forum on East Asia was under their direct responsibility, with Laura de Wolf, Senior
Specialist, Events and Meeting Coordinator; and Fabien Clerc, Community Relations Manager,
Asia.

Samantha Tonkin, Senior Media Manager at the World Economic Forum, worked with Ciara
Browne, Senior Community Manager, Catherine Ong, Alejandro Reyes and Wong Soo How to
produce this report.

The World Economic Forum would like to express its appreciation to the summary writers for
their work at the meeting. Session summaries are available at:
www.weforum.org/eastasia2008/summaries

Editing: Janet Hill, Editor

Design and Layout: Kamal Kimaoui, Associate Principal, Production and Design

Photographs: Azmi Abdul Alim




26 | World Economic Forum on East Asia
The World Economic Forum on East Asia Report is also available in electronic form on the World
Economic Forum website: http://www.weforum.org/summitreports/eastasia2008 (HTML)

The electronic version of this report allows access to a richer level of content from the meeting, including
photographs, session summaries and webcasts of selected sessions.

The report is also available as a PDF:
http://www.weforum.org/pdf/summitreports/eastasia2008.pdf

Other specific information on the World Economic Forum on East Asia, Kuala Lumpur, Malaysia 15-16 June
2008, can be found at the following links:


Meeting News                      www.weforum.org/eastasia2008
Session Summaries                 www.weforum.org/eastasia2008/summaries
Photographs                       www.pbase.com/forumweb/eastasia2008
Programme                         www.weforum.org/eastasia2008/programme
Interviews                        www.weforum.org/eastasia2008/regionalupdate
Partners                          www.weforum.org/eastasia2008/partners
Webcasts                          www.weforum.org/eastasia2008/webcasts




                                                                         27 | World Economic Forum on East Asia
The World Economic Forum is an independent
international organization committed to improving
the state of the world by engaging leaders in
partnerships to shape global, regional and
industry agendas.

Incorporated as a foundation in 1971, and based
in Geneva, Switzerland, the World Economic
Forum is impartial and not-for-profit; it is tied to
no political, partisan or national interests.
(www.weforum.org)

				
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