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ITO Kenichi
President, CEAC
"CEAC Commentary of the Month"
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"CEAC Commentary of the Month" presents a monthly publication of views of members of CEAC on an East Asian Community and other related international affairs. The views expressed herein are the author's own and should not be attributed to CEAC.
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The Third Crisis Accelerates the Integration of Asia
By YAMASHITA Eiji
Professor of Osaka City University
I do not agree with Japanese Prime Minister Aso's recent remarks that the dollar-based currency system should be maintained. The current financial crisis is likely to shake the dollar-based currency system. For Japan, it is high time to move forward on the multipolarization of key currency system. Besides, it is quite absurd for Japan to propose at this stage to offer 100 billion dollars to the IMF, which is so old and "feudal" an organization that only the United States can exercise the veto in its Executive Board Meeting. The United States is like a feudalistic Lord in the IMF. Even if such a proposal is to be made at all, it should be in exchange for a severe condition that the IMF's present governance be drastically reformed. Particularly, an outrageous 85% of the qualified majority voting in the IMF Executive Board Meeting should be reduced to a normal level, such as two-thirds or 70%. It will be detrimental to Japan's national interest if Japan should cling to its diplomatic footing of the past with the exclusive devotion to the alliance with the United States. Asia, including Japan, and the United States are not, and should not be, in the same boat. It is proved conclusively by the current financial crisis which has originated in the United States.
The integration of Asia was accelerated by overcoming two major crises that struck the area. The first was the sharp increase in the foreign direct investment to ASEAN countries by Japanese companies, which took place in corresponding to the very rapid appreciation of the yen after the Plaza Accord in 1985. This triggered the creation of very dense cross-border production networks in East Asia which have closely connected different stages of production processes in manufacturing industries. That is to say, the informal economic integration has already been established in East Asia. Such production and distribution networks are truly valuable assets of the economy in the area. The second was the Asian currency crisis in 1997, which propelled the formal integration process of Asia, based upon the agreements among the governments concerned in the area. Chiang Mai Initiative (CMI) of May 2000, in particular, ushered in a new stage of this line of integration.
The current US-origin financial crisis could become the catalyst for a trend of regional integration in many parts of the world, such as in Europe, Asia, South America and the Middle East in order to protect themselves from external shocks. Marked move should naturally been seen in the financial sector. There are already such moves in this direction as to multi-lateralize CMI, which has already been agreed upon, and to set up a standing secretariat of CMI in order to introduce surveillance mechanism for the regional economy. While the Ministry of Foreign Affairs (MOFA) and the Ministry of Economy, Trade and Industry (METI) of Japan have recently placed emphasis on East Asia Summit (EAS) comprising 16 countries, the Ministry of Finance (MOF) will play a central role in Japan when it comes to those moves in the financial sector, which should center on the framework of ASEAN+3 (APT), comprising 13 countries.
Although the momentum of the regional integration of Asia has been slowed down since 2005 with two regional frameworks of APT and EAS going side by side, thereby dissipating energy of the integration, it is expected that the current crisis put an end to this stagnation period and the momentum will be regained for the regional integration of Asia. The last thing the Japanese government should do is, of course, to impede this move in the right direction.
(This is the English translation of an article which originally appeared on the BBS "Hyakka-Somei" of CEAC on 30 November, 2008, and was posted on "CEAC Commentary" on 15 December, 2008.)
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For more views and opinions in the backnumber of "CEAC Commentary," the list of which for the past six months is as follows, please refer to:
http://www.ceac.jp/e/commentary/backnumber.html
No.52 No Independent State Tolerates Abduction of its Citizens
by HANAOKA Nobuaki, Journalist
(25 November, 2008)
No.51 Six-Year-Old NEAT Scores High
by ISHIGAKI Yasuji, Professor of Tokai University Law School
(22 October, 2008)
No.50 What Japan expects of Ambassador KWON Chulhyun
by OE Shinobu, Professor of Edogawa University
(24 September, 2008)
No.49 What Japan Should and Could Do for Development Aid to Africa
by IRIYAMA Akira, Guest Professor of Cyber University, and Executive Research Advisor of International Development Center of Japan
(22 August, 2008)
No.48 On the Historically Significant Agreement on Joint Development of Gas Fields between Japan and China
by SAKURADA Jun, Associate Professor of Toyo Gakuen University
(21 July, 2008)
"CEAC Updates"
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"CEAC Updates" introduces to you latest events, announcements and/or publications of CEAC.
Event
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CEAC plans to start a new Working Group (WG) of the Network of East Asian Think-tanks (NEAT) on "East Asian Food Security."
The 7th Annual Conference (AC) of the NEAT is scheduled to be held in August 2009 in Korea. Each Country Coordinator of NEAT can organize a WG in preparation for this AC. While NEAT Japan continues to co-sponsor with NEAT Singapore the WG on "East Asian Environmental Cooperation" which started last year, it will also launch a new WG on "East Asian Food Security" in view of the fact that agriculture is now in the midst of major changes due to soaring prices and declining food stocks. The outcome of these WGs will be reported to the 7th AC.
The Director of the WG on "East Asian Food Security" is Prof. OHGA Keiji, Member of CEAC and Professor Emeritus of the University of Tokyo. The members are Dr. OBA Mie, Member of CEAC and Associate Professor of Tokyo University of Science, Mr. KOYAMA Osamu, Head of Research Strategy Office of Japan International Research Center for Agricultural Science, and Prof. TOYODA Takashi, Member of CEAC and Professor of Tokyo University of Agricultural and Technology.
After a preparatory meeting is held by the Japanese team members on 2 March, a full-member WG meeting will be held in the beginning of June in Tokyo where experts in this field are invited from each of ASEAN countries plus China and Korea.
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