'Asia can drive world economy'
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'Asia can drive world economy'

Kamal Nath says he doesn't see the world's factories and the back offices, "moving anywhere else" from India.

india Updated: Jun 15, 2006 11:03 IST

Asia is confident it will be the engine of global economic growth for years to come, but some participants at a regional economic forum held in Tokyo said on Thursday that the past could get in the way.

While Asia's economy looks set to remain strong, driven largely by emerging economic superpower China as well as India, political will is needed to keep history from chilling growth, said Vietnamese Industry Minister Hoang Trung Hai.

"In the past, there has been some unfortunate history between Asian countries," he told the opening session of the World Economic Forum on Asia, held for the first time in Tokyo.

"If we hang onto the past, we are only impeding each other's progress."

His view was echoed by Japanese trade minister Toshihiro Nikai, who said that economic progress must take priority over such differences and that leaders must focus on that.

"Asia needs to work together more as one entity," he said.

Ties between Japan and neighbours China and South Korea have chilled markedly since 2001, largely due to Prime Minister Junichiro Koizumi's annual visits to a Tokyo war shrine where some convicted war criminals are honoured along with Japan's war dead.

East Asian leaders resolved last December to work towards building a regional community, but both the diversity of the nations represented as well as bickering between Japan and China illustrated the hurdles that lay ahead.

Jiang Jianqing, chairman of Industrial and Commercial Bank of China, China's biggest bank, took part in the same session but did not comment on the issue, instead simply reiterating the general confidence that Asia's economy will power global growth.

"I believe Asia and the emerging markets have become a locomotive for growth for the entire world," he said.

Many participants noted that the current optimism comes nearly a decade since the Asian financial crisis of 1997/98, when economies across the region took a beating, but that safeguards such as currency swap mechanisms have been put in place since then.

Given the area's huge population, which provides both an ample labour force as well as huge domestic markets, it seems likely the region will be able to overcome potential problems such as protectionism and continue to grow, participants said.

"We have both the world's factories and the world's back offices," said Kamal Nath, India's minister of Commerce and Industry. "I don't see these moving anywhere else."

First Published: Jun 15, 2006 11:03 IST