“The poorer members of Asean are not yet ready for the AEC. Even the richer members are not really ready for the AEC. This is because their domestic policies are not similar,” Mahathir told a conference on “Assessing Asean’s Readiness by Country” held by Krungthep Turakij newspaper at a Bangkok hotel.
Singapore is best prepared for the AEC because the city-state is a free port that has never relied for long periods on tariffs, he said. Other economies depend heavily on tariff duties, Mahathir said, noting that even his own country is second to Singapore in terms of readiness.
Asean members have the ambition to liberate and integrate their economies by promoting free movement of goods, investment, services and manpower by the end of 2015. Tariffs and non-tariff barriers are being pushed down and will be eliminated eventually.
If Asean sticks to its original schedule for economic integration, some countries might face difficulties, Mahathir said. “We should come together, but we should allow countries like Cambodia, Laos and Myanmar to protect their economies.”
Different strategies can achieve different results from trade liberalisation, such as with automobiles in Malaysia and Thailand, he said. He noted that Malaysia had invested a lot to develop its own automobile manufacturer – Proton Holdings – but had derived less benefit from the effort than Thailand had from its strategy of assembling foreign automobiles.
Mahathir suggested Asean look to the crisis in the European Union as a lesson for Asean integration.
“We cannot reject unity outright. On the other hand, we cannot just unite simply because the Europeans united. We need to know first why the EU has seemingly failed,” he said.
Europe is today an unequal community, he said. Countries in Eastern Europe as well as Spain, Portugal and Greece were relatively less developed and had low-cost economies, which formerly attracted tourism and investment from richer nations. Things changed when poorer European nations adopted the single euro currency. The rate of conversion was not properly worked out and the cost of living climbed. Some countries that are now in crisis made the mistake of borrowing money to meet their shortfalls and to sustain their high-cost living standards, he said.
The former Malaysian premier suggested Asean not make Europe’s mistake of adopting a single currency. Currency in this region could be traded but all individual members should retain their national currencies, he said. The trading of currency should be based on gold to make it more stable, he said. “We do not have a gold-based currency trade now and this may hamper the implementation of the AEC in 2015,” Mahathir said.
Former Asean chief Surin Pitsuwan said the association should boost trade within the group in order to realise its integration. Trade among the 10 nations accounted for only 25 per cent of their combined US$2.7 trillion (Bt85.7 trillion) in international trade, he said.
Most Asean members – the exceptions are Singapore and Brunei – are middle or low-income countries, Mahathir said. Malaysia is moving to high-income status quickly, but the rest should put more effort into investing more in research, technology and innovation, he said.
While eliminating tariff duties, Asean members should not put more non-tariff barriers into their trade regimes, he said.
Asean members have ratified 75 per cent of agreements to form the community, but that is not enough. It needed to do more to push forward integration. The group should allow free movement of professional workers to cross borders, otherwise integration would not happen, he said.
The move follows last month’s suspension by the Administrative Court of a plan under which tobacco firms must increase the size of the warning graphics from 55 per cent of the pack surface to 85 per cent.
Disease Control Department deputy chief Dr Nopporn Cheanklin said the ministry’s appeal asked the court to force cigarette makers to use 10 warning graphics from October 2. It would also force them to enlarge the graphics so they cover up to 85 per cent of the packaging surface.
Public Health Minister Pradit Sintavanarong said at least nine cigarette makers had complied with the ministerial announcement and changed the warning graphics. Two of them had already shipped their products to Thailand.
After the Cabinet chose not to implement the Internal Security Act yesterday, Viroj decided to declare Cha-uat district’s Khuan Nong Hong Intersection as a restricted area under the Disaster Prevention Act of 2007 for 24 hours since Monday night.
However, insisting that her government would resolve the problem lawfully, Prime Minister Yingluck Shinawatra said she believed the Disaster Prevention Act was good enough to control the situation. She has also given her deputies Kittiratt Na-Ranong and Yukol Limlamthong the task of setting up mid- and long-term measures with operators of processed rubber businesses.
Meanwhile, protesters continued blocking a section of Highway 41 with pipes and tree branches. Security officials set up a checkpoint about a kilometre from the protest site in order to ensure no weapons were being taken in and urged motorists to take alternative routes.
At a meeting with related officials yesterday, Viroj urged agriculture officials to inspect rubber stocks at areas near the protest site since he had heard that some shops were hoarding rubber and supplying food to protesters. The meeting was also told that Army Region 4 had decided to set up a war room to provide back-up in case of emergency.
Provincial police deputy chief Suthat Chansawat said 119 police officers had been injured, nine state vehicles damaged and three guns had gone missing during Monday’s clash.
Viroj had earlier told Thai PBS TV that negotiations were going ahead but rubber growers continued to add demands. Other than demanding that the government boost the price of rubber from Bt90/kg to Bt120, “they are now demanding that the PM attend parliamentary sessions and sit at the negotiation table. These demands come from nowhere”, he said.
Meanwhile, PM’s deputy secret
— Phuket Gazette Editors