China plus ASEAN plus FTA equals East Asian Unification? Not Quite Part II

As discussed in Part I of this series, the ASEAN-China Free Trade Agreement (ACFTA) will be a win-win for the signatories. The agreement will produce greater economies of scales, as it expands trade between members, which will result in an aggregate increase in competitive export products from China and ASEAN. However, it will not foreshadow European-style regional integration, at least not in the near future. The centrifugal force generated by the agreement will not only draw ASEAN closer to China, the regions manufacturing hub, but it will push those states outside the bloc to liberalize their own trade in order to stay competitive. While the United States is generally supportive of ASEAN, it is not in the strategic interest of the U.S. for it to be outside of an Asian economic bloc, especially one that will aid in cementing a strong Chinese leadership position in Southeast Asia. Implementation of this agreement has increased concerns among some analysts that the economic and perhaps, the political center of gravity of the region are shifting away from the United States and toward China.

Over the last 10 years, Southeast Asia has received approximately US$90 billion in U.S. foreign direct investment (FDI); it is the third largest market for U.S. exports; and U.S.-ASEAN trade is over US$140 billion (Pitsuwan 2008). Southeast Asia is flush with agricultural and natural resources, and is home to more than half of the world's annual merchant shipping traffic. Intraregional trade between ASEAN nations still hovers at 25% and in East Asia, it now verges on 55% (Pitsuwan 2008). Over 80% of Japanese and Chinese oil imports travel through these sea-lanes. The geopolitical reality is that due to proximity and economic clout, China's access to this region will increase. This could not only be detrimental to America's economic interests, but also represent a strategic threat.

It is in America and ASEANs best interest for the U.S. to not only promote further ASEAN integration, but also establish stronger ties with the region. This will enable ASEAN to serve as a fulcrum between China (and India). America must also realize that China's increasing penetration into Southeast Asia is not a zero-sum game; the U.S. must be prepared to have a constructive working relationship with China in the region. If the America hopes to balance China's growing influence it will need a rapprochement with ASEAN that displays a cohesive policy for the organization, but at the same time exploit the diversity of opinion within ASEAN. This will allow the U.S. to advance its policy goals in the region.

China

Over the last decade, China's resurgent role in Southeast Asia has moved from a situation that generated fear in the region, to one where China is seen as a benign regional leader that plays a constructive role in creating opportunity. China has worked hard to market this image while participating in regional institutions. Its long-term goals are to create greater interdependencies between itself and Southeast Asia through economic incentives, which will give ASEAN a strong stake in China's success. In this way, ASEAN can serve as insurance against possible U.S., Japanese, Indian containment in the South China Sea and Indian Ocean. At the same time, Beijing hopes it can simultaneously reduce the influence of the United States in the South China Sea.

China is increasing its political reach in the region through a series of strong bilateral ties with ASEAN member-states. These links include increased cooperation in regional security (including providing military training), scholarships, and helping to facilitate conflict resolution in the region. China has also promised over US$10 billion in infrastructure, energy, and cultural programs between the countries. China has especially provided special assistance to the lesser developed states of Cambodia, Laos, and Myanmar.

During the 1997 Asian financial Crisis, America did not provide significant leadership, which left room for China advance itself as a regional leader, often at the expense of Japan. China promised not to devalue its currency, the Renminbi, which helped return stability to the markets, a move much praised in the region. Tokyo worked to provide a competitive framework for an Asian Monetary fund, in an effort to engender long-term stability. Washington repeatedly blocked this endeavor, out of fear it would be froze-out by a potential Asian bloc. Japan and China are still pushing their competing ideas of a greater-East Asia economic sphere, but the main difference between the two nations is that Japan wishes to include Australia, New Zealand, and India in an attempt to minimize the influence of China. Obviously, China is not interested in having none ASEAN and East Asian nations involved.

The idea for an Asian Monetary Fund did not die. In February 2008, the ASEAN+3 forum in Thailand agreed to expand bilateral currency swaps and also enlarge the Chiang Mai Initiative reserve fund in order to enhance regional economic stability in the wake of the current global financial crisis. This goal has prompted ASEAN+3, in coordination with the Asian Development Bank (ADB), to develop an Asian Currency Unit (ACU) as part of a comprehensive Asian Monetary Fund. China has promoted the idea, which has gained wide regional support. China championing this effort appears surprising considering past objections; however, Beijing is supportive of the ACU because it is now able to take a greater leadership role in its management than Japan, whereas it was not in a position to do so 10 years earlier. Although meant to be non-tradable, the ACU would be an indicator of the stability of participating currencies in the region, an Asian version of the European Currency Unit, which was the precursor to the Euro. Due to the wide variance in levels of economic development, the sophistication of financial transfer systems, and the levels of nationalism in the Pacific Rim, a single currency for the region is still unlikely.

What ASEAN Needs

Western analyst had long criticized and even dismissed ASEAN; the common narrative characterized the organization as soft on human rights and democracy, and therefore incapable of taking decisive and constructive action concerning regional issues that were important to the West. Some pasts areas of conflict involved human rights in Myanmar and East Timor, as well as issues of democracy in key members states like Singapore, Indonesia, and Malaysia. Part of the problem is that Western observers have not tended to judge ASEAN on its own merit, but instead, based on how it compares to the contemporary European Union (EU). As a result, ASEAN has never been fully respected by the United States.

For their part, not all ASEAN members have been eager to see a stronger American presence in the region. In the 1990's, former Malaysian Prime Minister Mahathir Mohamad called for a greater East Asian forum, which would exclude the U.S., Australia, and New Zealand. Many in the region termed this the "caucus without Caucasians", something Washington successfully nixed, but to only see it rebooted a decade later as ASEAN+3.

At the time, the exclusion of Western nations reflected the regional vogue of "Asian Values", an ideology trumpeted by Malaysia, Singapore, Indonesia, along with some political thinkers in Japan. Those who adhered to this ideology espoused that all Asians share distinctive cultural traits that make them fundamentally different from Westerners; therefore, Western political and social norms were not entirely appropriate for Asian societies. Some of these shared Asian values are a preference for social harmony, government paternalism, collectivism over the rights of individuals, respect toward authority, and a greater concern for socio-economic stability over human rights.

By the turn of the century, deeply pragmatic ASEAN states came to the realization that it was impossible to push Western powers out of the region, so it began what was termed, "constructive engagement" with all of them. Under this policy, ASEAN intends to hedge its relationship with the larger powers (China, India, America, and Australia) as an intermediary, reaping the benefits for its member states. Singapore Minister of Foreign Affairs George Yeo, speaking for ASEAN to the press in November 2007, described the importance of America to Southeast Asia: "In short, no major strategic issue in Asia can be resolved without the active participation of the U.S" (Marciel 2008).

America's Next Move

In the aftermath of 9-11, the bulk of Washington's foreign policy capacity was consumed by wars in the Middle East and Central Asia. Major initiatives in Southeast Asia fell by the wayside as the primary focus moved to counterterrorism and other security concerns. Even when America's focus broadened beyond the "War on Terror" into issues of trade, its approach was often ineffectual. The U.S. cannot afford to squander another decade in the region teetering between security issues and weak trade.

The 2005, Joint Vision Statement on the ASEAN-U.S. Enhanced Partnership was not enough to secure America's future in Southeast Asia; Washington needs to define, create, and utilize more avenues of regular dialogue between itself and ASEAN. Although the U.S. and ASEAN have enjoyed relations for 30 years, no regular annual summits have ever been established. Shoring up the 21-member Asia-Pacific Economic Cooperation forum (APEC) is a good place to begin, but it should only be a pass-through for more specialized U.S.-ASEAN talks. The current lack of contact hurts America's ability to focus its attention on ASEAN states. The U.S. should encourage East/Southeast Asian integration, because it will help to socialize and constrain provocative movements by China. It may also encourage American investors to do greater business in the region, as the various types of independent national laws and regulations are streamlined. Nevertheless, America should also exploit areas of friction between ASEAN and China, as well as the lack of cohesion within ASEAN.

Although China has achieved strong ties with certain members of ASEAN, many nations in the region, such as Malaysia, the Philippines, and Vietnam still maintain a healthy fear of Chinese hegemony and anti-Chinese sentiment in their populations has not yet abated. There have been complaints, by some ASEAN members, that China pushed bilateral FTA negotiations to isolate nations that were not very pro-China, such as Malaysia and Vietnam. Southeast Asian diplomats have also grumbled that China's influence has hindered consensus building within ASEAN as member nations try to gage Beijing's potential reaction.

The U.S. has also not closely engaged China-friendly states, such as Myanmar and Cambodia. This is especially true in the case of Myanmar due to human rights concerns, which have resulted in embargoes that have resulted in little political change. The U.S. needs a more pragmatic approach. These nations would be very receptive to American competition for their attention.

The United States and Japan remain the largest investors in the region and the largest ASEAN export receivers. China is not close to eclipsing the U.S. in hard power projection and America is still the largest source of popular culture. With respect to trade, some ASEAN members are not pleased that Early Harvest has allowed China to compete in raw materials, agricultural products, and minerals it did not produce, whereas China will eventually have lower tariff free access to manufacturing markets that ASEAN and Chinese firms were already competing in.

The U.S. has much more work to do on the free trade front. Thus far, America has only one FTA completed agreements, in the nearly 15 years since the U.S. initiated its first Asia-Pacific TIFA, with Singapore in 1991. There are stalled negotiations for FTAs with Thailand and Malaysia, and the Philippines and Indonesia have expressed interest in FTAs. Besides FTAs, policymakers have other eco­nomically significant agreements available, including the expansion of trade and investment framework agree­ments (TIFA) and open skies agreements (OSA). A TIFA is a consultative mechanism for the United States to discuss trade issues, and an OSA creates free markets for aviation services. America has TIFAs with ASEAN, but TIFAs and OSAs have been severely underutilized. Unlike China, the U.S. should work as multilateral as possible with ASEAN to avoid the negative effects of export diversion and encourage ASEAN unity.

Long term, the U.S. could do more in advancing the scope of FTAs and OSAs in Asia. A region-wide agreement would better reduce regional trade barriers, increase U.S.-ASEAN trade, and advance American security interests. The U.S. must stop blocking Japan's attempts to project a competing vision of Asian unity, because it has not worked. The only result is Japan losing influence to China, which is not in Japan or America's national interests. Instead, Washington can work with Japan to promote shared interests inside the ASEAN+3 framework, where Japan can serve as a U.S. proxy on specific issues critical to both nations. This would be a similar relationship to what the U.S. enjoys with Britain with respect to the European Union. Currently, Northeast Asia's economic heavyweights are the world's last remaining region that lacks an inter-governmental trade bloc, such as ASEAN. The U.S. does not want to find itself outside such a teaming, so it should be working with Japan to create one that is more inclusive. Even if FTAs are not politically feasible, the US should focus on TIFAs for high priority areas of interest.

Lastly, the U.S. should do what it must to gain Japan's assistance in fighting any attempts for an tradable ACU, because that could limit U.S. government's ability to finance its larger budget deficits at relatively low interest.

Notes:

As discussed in Part I of this series, the ASEAN-China Free Trade Agreement (ACFTA) will be a win-win for the signatories. The agreement will produce greater economies of scales, as it expands trade between members, which will result in an aggregate increase in competitive export products from China and ASEAN. However, it will not foreshadow European-style regional integration, at least not in the near future. The centrifugal force generated by the agreement will not only draw ASEAN closer to China, the regions manufacturing hub, but it will push those states outside the bloc to liberalize their own trade in order to stay competitive. While the United States is generally supportive of ASEAN, it is not in the strategic interest of the U.S. for it to be outside of an Asian economic bloc, especially one that will aid in cementing a strong Chinese leadership position in Southeast Asia. Implementation of this agreement has increased concerns among some analysts that the economic and perhaps, the political center of gravity of the region are shifting away from the United States and toward China.

Over the last 10 years, Southeast Asia has received approximately US$90 billion in U.S. foreign direct investment (FDI); it is the third largest market for U.S. exports; and U.S.-ASEAN trade is over US$140 billion (Pitsuwan 2008). Southeast Asia is flush with agricultural and natural resources, and is home to more than half of the world's annual merchant shipping traffic. Intraregional trade between ASEAN nations still hovers at 25% and in East Asia, it now verges on 55% (Pitsuwan 2008). Over 80% of Japanese and Chinese oil imports travel through these sea-lanes. The geopolitical reality is that due to proximity and economic clout, China's access to this region will increase. This could not only be detrimental to America's economic interests, but also represent a strategic threat.

It is in America and ASEANs best interest for the U.S. to not only promote further ASEAN integration, but also establish stronger ties with the region. This will enable ASEAN to serve as a fulcrum between China (and India). America must also realize that China's increasing penetration into Southeast Asia is not a zero-sum game; the U.S. must be prepared to have a constructive working relationship with China in the region. If the America hopes to balance China's growing influence it will need a rapprochement with ASEAN that displays a cohesive policy for the organization, but at the same time exploit the diversity of opinion within ASEAN. This will allow the U.S. to advance its policy goals in the region.

China

Over the last decade, China's resurgent role in Southeast Asia has moved from a situation that generated fear in the region, to one where China is seen as a benign regional leader that plays a constructive role in creating opportunity. China has worked hard to market this image while participating in regional institutions. Its long-term goals are to create greater interdependencies between itself and Southeast Asia through economic incentives, which will give ASEAN a strong stake in China's success. In this way, ASEAN can serve as insurance against possible U.S., Japanese, Indian containment in the South China Sea and Indian Ocean. At the same time, Beijing hopes it can simultaneously reduce the influence of the United States in the South China Sea.

China is increasing its political reach in the region through a series of strong bilateral ties with ASEAN member-states. These links include increased cooperation in regional security (including providing military training), scholarships, and helping to facilitate conflict resolution in the region. China has also promised over US$10 billion in infrastructure, energy, and cultural programs between the countries. China has especially provided special assistance to the lesser developed states of Cambodia, Laos, and Myanmar.

During the 1997 Asian financial Crisis, America did not provide significant leadership, which left room for China advance itself as a regional leader, often at the expense of Japan. China promised not to devalue its currency, the Renminbi, which helped return stability to the markets, a move much praised in the region. Tokyo worked to provide a competitive framework for an Asian Monetary fund, in an effort to engender long-term stability. Washington repeatedly blocked this endeavor, out of fear it would be froze-out by a potential Asian bloc. Japan and China are still pushing their competing ideas of a greater-East Asia economic sphere, but the main difference between the two nations is that Japan wishes to include Australia, New Zealand, and India in an attempt to minimize the influence of China. Obviously, China is not interested in having none ASEAN and East Asian nations involved.

The idea for an Asian Monetary Fund did not die. In February 2008, the ASEAN+3 forum in Thailand agreed to expand bilateral currency swaps and also enlarge the Chiang Mai Initiative reserve fund in order to enhance regional economic stability in the wake of the current global financial crisis. This goal has prompted ASEAN+3, in coordination with the Asian Development Bank (ADB), to develop an Asian Currency Unit (ACU) as part of a comprehensive Asian Monetary Fund. China has promoted the idea, which has gained wide regional support. China championing this effort appears surprising considering past objections; however, Beijing is supportive of the ACU because it is now able to take a greater leadership role in its management than Japan, whereas it was not in a position to do so 10 years earlier. Although meant to be non-tradable, the ACU would be an indicator of the stability of participating currencies in the region, an Asian version of the European Currency Unit, which was the precursor to the Euro. Due to the wide variance in levels of economic development, the sophistication of financial transfer systems, and the levels of nationalism in the Pacific Rim, a single currency for the region is still unlikely.

What ASEAN Needs

Western analyst had long criticized and even dismissed ASEAN; the common narrative characterized the organization as soft on human rights and democracy, and therefore incapable of taking decisive and constructive action concerning regional issues that were important to the West. Some pasts areas of conflict involved human rights in Myanmar and East Timor, as well as issues of democracy in key members states like Singapore, Indonesia, and Malaysia. Part of the problem is that Western observers have not tended to judge ASEAN on its own merit, but instead, based on how it compares to the contemporary European Union (EU). As a result, ASEAN has never been fully respected by the United States.

For their part, not all ASEAN members have been eager to see a stronger American presence in the region. In the 1990's, former Malaysian Prime Minister Mahathir Mohamad called for a greater East Asian forum, which would exclude the U.S., Australia, and New Zealand. Many in the region termed this the "caucus without Caucasians", something Washington successfully nixed, but to only see it rebooted a decade later as ASEAN+3.

At the time, the exclusion of Western nations reflected the regional vogue of "Asian Values", an ideology trumpeted by Malaysia, Singapore, Indonesia, along with some political thinkers in Japan. Those who adhered to this ideology espoused that all Asians share distinctive cultural traits that make them fundamentally different from Westerners; therefore, Western political and social norms were not entirely appropriate for Asian societies. Some of these shared Asian values are a preference for social harmony, government paternalism, collectivism over the rights of individuals, respect toward authority, and a greater concern for socio-economic stability over human rights.

By the turn of the century, deeply pragmatic ASEAN states came to the realization that it was impossible to push Western powers out of the region, so it began what was termed, "constructive engagement" with all of them. Under this policy, ASEAN intends to hedge its relationship with the larger powers (China, India, America, and Australia) as an intermediary, reaping the benefits for its member states. Singapore Minister of Foreign Affairs George Yeo, speaking for ASEAN to the press in November 2007, described the importance of America to Southeast Asia: "In short, no major strategic issue in Asia can be resolved without the active participation of the U.S" (Marciel 2008).

America's Next Move

In the aftermath of 9-11, the bulk of Washington's foreign policy capacity was consumed by wars in the Middle East and Central Asia. Major initiatives in Southeast Asia fell by the wayside as the primary focus moved to counterterrorism and other security concerns. Even when America's focus broadened beyond the "War on Terror" into issues of trade, its approach was often ineffectual. The U.S. cannot afford to squander another decade in the region teetering between security issues and weak trade.

The 2005, Joint Vision Statement on the ASEAN-U.S. Enhanced Partnership was not enough to secure America's future in Southeast Asia; Washington needs to define, create, and utilize more avenues of regular dialogue between itself and ASEAN. Although the U.S. and ASEAN have enjoyed relations for 30 years, no regular annual summits have ever been established. Shoring up the 21-member Asia-Pacific Economic Cooperation forum (APEC) is a good place to begin, but it should only be a pass-through for more specialized U.S.-ASEAN talks. The current lack of contact hurts America's ability to focus its attention on ASEAN states. The U.S. should encourage East/Southeast Asian integration, because it will help to socialize and constrain provocative movements by China. It may also encourage American investors to do greater business in the region, as the various types of independent national laws and regulations are streamlined. Nevertheless, America should also exploit areas of friction between ASEAN and China, as well as the lack of cohesion within ASEAN.

Although China has achieved strong ties with certain members of ASEAN, many nations in the region, such as Malaysia, the Philippines, and Vietnam still maintain a healthy fear of Chinese hegemony and anti-Chinese sentiment in their populations has not yet abated. There have been complaints, by some ASEAN members, that China pushed bilateral FTA negotiations to isolate nations that were not very pro-China, such as Malaysia and Vietnam. Southeast Asian diplomats have also grumbled that China's influence has hindered consensus building within ASEAN as member nations try to gage Beijing's potential reaction.

The U.S. has also not closely engaged China-friendly states, such as Myanmar and Cambodia. This is especially true in the case of Myanmar due to human rights concerns, which have resulted in embargoes that have resulted in little political change. The U.S. needs a more pragmatic approach. These nations would be very receptive to American competition for their attention.

The United States and Japan remain the largest investors in the region and the largest ASEAN export receivers. China is not close to eclipsing the U.S. in hard power projection and America is still the largest source of popular culture. With respect to trade, some ASEAN members are not pleased that Early Harvest has allowed China to compete in raw materials, agricultural products, and minerals it did not produce, whereas China will eventually have lower tariff free access to manufacturing markets that ASEAN and Chinese firms were already competing in.

The U.S. has much more work to do on the free trade front. Thus far, America has only one FTA completed agreements, in the nearly 15 years since the U.S. initiated its first Asia-Pacific TIFA, with Singapore in 1991. There are stalled negotiations for FTAs with Thailand and Malaysia, and the Philippines and Indonesia have expressed interest in FTAs. Besides FTAs, policymakers have other eco­nomically significant agreements available, including the expansion of trade and investment framework agree­ments (TIFA) and open skies agreements (OSA). A TIFA is a consultative mechanism for the United States to discuss trade issues, and an OSA creates free markets for aviation services. America has TIFAs with ASEAN, but TIFAs and OSAs have been severely underutilized. Unlike China, the U.S. should work as multilateral as possible with ASEAN to avoid the negative effects of export diversion and encourage ASEAN unity.

Long term, the U.S. could do more in advancing the scope of FTAs and OSAs in Asia. A region-wide agreement would better reduce regional trade barriers, increase U.S.-ASEAN trade, and advance American security interests. The U.S. must stop blocking Japan's attempts to project a competing vision of Asian unity, because it has not worked. The only result is Japan losing influence to China, which is not in Japan or America's national interests. Instead, Washington can work with Japan to promote shared interests inside the ASEAN+3 framework, where Japan can serve as a U.S. proxy on specific issues critical to both nations. This would be a similar relationship to what the U.S. enjoys with Britain with respect to the European Union. Currently, Northeast Asia's economic heavyweights are the world's last remaining region that lacks an inter-governmental trade bloc, such as ASEAN. The U.S. does not want to find itself outside such a teaming, so it should be working with Japan to create one that is more inclusive. Even if FTAs are not politically feasible, the US should focus on TIFAs for high priority areas of interest.

Lastly, the U.S. should do what it must to gain Japan's assistance in fighting any attempts for an tradable ACU, because that could limit U.S. government's ability to finance its larger budget deficits at relatively low interest.

Notes:

Pitsuwan, Surin. 2008. "Bolstering U.S.-ASEAN Cooperation"

Japan Times Online.

Marciel, Scot A. 2008. "Remarks to Center o Strategic International Studies Meeting

'U.S. and Southeast Asia: Toward a Strategy for Enhanced Engagement'"

U.S. State Department.

Collin A. Spears

Malaysia and Singapore - Asian Nations of Economic Success by Globalization

The brightness of the glittering Twin Towers of Malaysia, the one time tallest buildings of the world is telling many success stories of Malaysia and how it has been transformed into one of the Asia's wealthiest nations.

The serene beauty of the sky-high towers with a celestial background of shining stars in a clear dark night in the far distance, propelled my thoughts back into the good old Malaysia where, while Dr. Mahathir Mohamad was criticising the western capitalism, how cleverly he applied the open economic strategies which made Malaysia to trade all over the world and its entrepreneurs to become international players.

Dr. Mahathir's open economic strategy with a clear vision and a mission triggered my memories back into my effort "Strategic Post-Conflict Economic Development Initiative" as an awareness program to transform into Sri Lanka's war-ravaged economy into one of the South Asia's best. Dr. Mahathir's strategies are well reflected in his macro - economic strategies by adopting the open economic policies with the realization in mind that the world trend of Globalization and Liberalization is irreversible. We are living in an era of Globalization & Liberalization, a deeply imbedded neo-classical economic thought and its applications everywhere in the globe.

This overwhelming tide of G&L is reinforced and accelerated by the wide spread of Boeing and Airbus jets, Information Technology and the better and efficient shipping facilities which made the entire world into much smaller and less distant than ever.

The current Prime Minister of Singapore Lee Hsien Loong once said far back in the late nineties when he was the deputy Prime Minister, "It is better to embrace globalization and liberalization proactively, at our own pace, than face the prospect of one day being swept away by the floodwaters of competition."

His realization of embracing the globalization and liberalization might have been inherited into him by the strategies of former Prime Minister of Singapore Lee Kuan Yew who in his long tenure, changed Singapore from a sleepy colonial outpost to a prosperous high-tech enclave and applied better open economic policies to make use of the Globalization and Liberalization in Singapore's favour.

Now Singapore's per capita GNP is higher than that of its erstwhile colonizer, Great Britain. It has the world's busiest port and is the third-largest oil refiner and a major center for global manufacturing and service industries. And this move from poverty to plenty has taken place within one generation. In 1965 Singapore ranked economically with Chile, Argentina and Mexico but today its per capita GNP is four or five times of theirs.

Lee Kuan Yew managed this miraculous transformation in Singapore's economy while maintaining tight political control over the country. Malaysia and Singapore better managed their economies in Southeast Asia than any other countries in facing the new trends of Globalization and Liberalization.

Dr. Mahathir's strategies have eventually made Malaysia into a Southeast Asian economic superpower with number of megastar Malaysian entrepreneurs.

Tan Sri Ananthakrishnan, who owns the Twin Towers of Malaysia and several other conglomerates is a role model for many Malaysian entrepreneurs who have given real meaning to the present day Malaysia by transforming Malaysia into one of the Asia's wealthiest nations. Tan Sri Anantha krishnan, a Jaffna origin Malaysian who had a humble beginning as a smalltime bookmaker in Australia and later as a polished dealmaker with a degree from Harvard Business School, became a sophisticated oil trader with connections to many of the Asia's political and petroleum industry elite with interests in oil and gas fields in the United States.

Tan Sri Anandakrishnan later went further into orbit, with the successful launching of MEASAT - 1, the Malaysia's maiden telecommunication satellite. Tan Sri Ananda krishnan's success provides a compelling testimony to Dr. Mahathir's economic policies and their successful implementations.

Though, today, Dr Mahathir stepped down from power, Malaysia boasts a diversified and modern economy, which weathered the Asian financial crisis in1997-98 better than many of its peers. Malaysia's success has been by diversifying away from the export of palm oil and rubber to the assembly of electronics with the steady provision of political stability by the resolved ethnic divisions by Dr. Mahathir.

Dr. Mahathir's keen stewardship of the economy has spawned in various projects and the latest was the Multimedia Super Corridor - a "knowledge-based economy master plan" to upgrade the Malaysia's electronics industry into a hi-tech application industry. The knowledge-based economy master plan which encourages the new trend of Business and Knowledge Process Outsourcing is a new dimension of Globalization.

Southeast Asia first experienced a new and different wave of Globalization from Japan by the transferring their locations to more labour - intensive and resource - intensive Asian countries so that Japan could continue to form the international cooperation. By this Japanese initiative of Global - localization most of the Asian countries are generally favourable towards the Globalization trend. The born-again WTO from the old GATT is permanently positioned to look after the liberalization.

The trend of Globalization and Liberalization is indisputably irreversible. Therefore, it is really a great challenge to developing countries. Singapore and Malaysia are successful in tackling the Globalization and Liberalization because they were well - prepared.

These Southeast Asian tiger economies, all went through series of distinctive stages of economic transformation with certain common characteristics.

Lee Kwan Yew and Dr. Mahathir Mohammed had clear long term visions and strong political leadership skills how to make use of the globalization in their countries' favour. In Malaysia and Singapore there are strong and efficient technocrats who have the ability to chart the vision into planning with the capability to get things done in a much effective way.

The value system which they have reinvented over a short span of time after the independence produced many successful women entrepreneurs in Malaysia and Singapore. Malaysia and Singapore successfully defined the paths for the emergence of indigenous entrepreneurs by encouraging small and medium size enterprises.

They overcome the problems of relatively shallow and weak entrepreneurial group in Malaysia and Singapore compared with well equipped and well experienced thick and abundant entrepreneurial group in developed countries.

They altered their countries' entrepreneurial strength for an equal match of the game if confronted each other directly and instantly. They looked after the private sector until they can stand alone to compete against international challenges to become themselves multi-nationals. They realized well in advance the strength and competence of the private sector which is the main market player in determining a country's eventual competitiveness.

Though Malaysia and Singapore had constraints, they realized the importance of Government Leadership in the very beginning itself. Their governments identified and developed the countries' long-term competitiveness. They have given meaning to the leadership which can contain not only vision, imagination and direction but also commitment, dedication and thorough follow-up.

They have given real meaning to the ability to translate political leaders' visions into realizable planning and policies and made eventually their countries as the richest nations of Asia and beyond.

Rajkumar Kanagasingam is the author of the fascinating book - "German Memories in Asia"...A collection of memories by the author in his discussion with German university students who have been volunteering in Asia on the sensitive issues of Early Human Migration, Asian & European historical events especially the German since the Roman Empire era to the times of First & Second World Wars and about the Germans around the world and their Migrations, Life styles, Encounters and Assimilations since the ancient times, his experiences in an American NGO as an officer in the rebel-held war-torn jungles and then in a tsunami relief mission there with German students, and the German students' life and fashion in Asia....

The book could be ordered at over 30,000 retail outlets world wide & is listed on Amazon.com & more...

More about the book: http://www.authorhouse.com/BookStore/ItemDetail.aspx?bookid=41609

Asian Generic Medicine Producers

The United States FDA or Food and Drug Administration described a generic drug as "identical, or bioequivalent to a brand name drug in dosage form, safety, strength, route of administration, quality, performance characteristics and intended use." Simply put, generic drugs have the similar pharmacological effects as their brand counterparts counterparts. People who buy generic drugs chose for a cheaper alternative to more commercialized medicines. An sample of a generic medication is metformin, used for diabetes. Its branded variant is Glucophage. There's also metorpolol, the pill for hypertension with Lopressor as the brand medicine.

Generics vs. Branded

Generic drugs are not sold at lower prices because they have lower quality. As a matter of fact, the US FDA requires all generics to work safely and effectively. Since they have similar chemical compositions, generics have the same effects as their brand-name counterpart. Most branded manufacturers are also related to 50% of generic drug production. These manufacturers also offer copies of their patented products in order to sell them for less without the brand name.

Generic meds are sold at significantly cheaper prices because they are no longer protected by patents. Since competition in the generics market increases, the medicine is offered at an affordable price in order to give it some advantage. There are less costs incurred compared to creating the original patent, so the drug manufacturer can maintain profit selling at a low price. Branded drugs on the other hand are offered at higher prices due to the expenses incurred from inventing with the actual drug. New meds introduced in the market have to attain a ROI||return of investment because of the costs incurred through research, development and marketing the product. The patent gives protection to these expenses and gives the developer exclusive rights to sell the product. Patent protection lasts for 20 years which starts from its date of submission. Towards the expiry date, the producers can apply their generic forms to the FDA.

Asian Generics

The increasing number of patent expirations and the people's need for low priced drugs has aggravate the manufacturing of generic medication in Asia. In India, many pharmaceutical companies are responsible for generic forms of in demand drugs. Some foreign firms are even creating generic versions of biotech meds. The Philippines also plays a huge role in the generic medication market, with an expanding share of thirty one percent led by three to four worldwide manufacturers.

Indian pharmaceutical companies play the biggest role in the generic meds market, having sold hundreds of generic medicines to American consumers. In 2008, the FDA said that India's major drug maker Ranbaxy Laboratories submitted fraudulent laboratory test results for generic drugs that were given approval for sale in the US. Even though this is a huge cause for concern, the director of compliance from the FDA, Deborah Autor says that this development is not related to the safety or effectiveness of the drugs from Ranbaxy. Several tests prove that there are no infected Ranbaxy pills. Deputy drug director Dr. Douglas Throckmorton says that "there is no reason for anyone to believe that the drugs in the US from the Ranbaxy plants pose a safety problem."

The course of action taken by the FDA against the company does not harm the quality of imported generic drugs. As a matter of fact, it reveals the high standards that the FDA has for all types of drugs. Generic pills manufactured in Asian countries have the same components and go through similar measures as drugs produced in more developed nations like US or Europe.

Americans who buy medications from India or China does not need to worry as these manufacturers are required to fully specify the drug's chemistry, production steps, and quality control measures. The generic pills or medicines must also meet the terms of the American Pharamacopoeia, the association that sets the standard for drug pureness in the US. The drug manufactured should stay potent until its expiration date and follow the good processes of the FDA. A full description of what the company uses to create, process, test, package, and label the pill is submitted also. The FDA also performs inspections to confirm if the manufacturing facilities are following with their standards.

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