Sensitive, open leaders tipped for future Asia

By Nikki Mandow

The Asian crisis will force the emergence of a new generation of political leaders in Asia over the next 10 years - leaders more open-minded, pluralistic and sensitive to the views of their citizens.

But this is going to be a traumatic transition in many countries and must involve much more constructive interaction between government and the private sector, working for national and regional advancement, rather than the cosy pursuit of self-interests.

These are the views of Roberto Romulo, top Philippines businessman, former Philippines diplomat and ex-Secretary of Foreign Affairs.

In New Zealand late last week wearing the hat of chairman of the 22-member Pacific Economic Cooperation Council (PECC) and speaking to the New Zealand Committee (NZPECC)'s annual general meeting in Auckland, Romulo believes the "strong guiding hand that has provided prosperity and stability in many countries in Southeast Asia" will be replaced by "the invisible guiding hand of [18th century free trade economist] Adam Smith."

"My personal theory is that those [Asian nations] which have a pluralistic form of government and have developed economies are less vulnerable to a crisis such as [we have in Asia today]. In countries with prosperity, but no semblance of democratic principles and institutions, the collapse is more drastic."

A new spirit of open-mindedness will mean Southeast Asian leaders embracing new technology, listening to the market, but also being less sensitive to so-called "interference" from near neighbours.

"It's incumbent on the business/corporate world and academics to lobby to make sure governments have the right perspectives to create an environment where globalism can move forward."

Romulo, Chairman of the Philippine Long Distance Telephone Company and a former President and General Manager of IBM Philippines, believes recovery from the Asian crisis is between five and seven years away, but says continuation of the economic liberalisation and regional cooperation process through PECC and the inter-government APEC (Asia Pacific Economic Cooperation) is key to such a recovery.

Next month's APEC leaders meeting in Kuala Lumpur is unlikely to produce much more than a show of regional solidarity - Romulo believes all the leaders will attend, despite boycott threats from the Philippines and Indonesia - and a reaffirmation of the core APEC goals, set in Bogor in 1994, he says. But this gives New Zealand a real opportunity to make its mark on APEC with some visionary strategies and positive outcomes from the 1999 meeting.

"Canada [the 1997 APEC host] was still trying to work out where the Pacific was. Malaysia [this year's host] has been misdirected because of current events there. But New Zealand can make history in APEC annuls."

As a former head of the government-appointed APEC Business Advisory Council (ABAC), Romulo is particularly concerned by the failure of APEC to capture the interest and support of the majority of business people, including those in New Zealand.

"So far in ABAC we have not got ourselves a report card. We have no rating because we aren't yet relevant and… with senior managers in corporates mostly too busy to make [APEC-related ] decisions… we've become captured by senior officials."

Former Kiwi Trade Negotiations Minister Philip Burdon, chairman of ABAC during New Zealand's APEC year, has responsibility for trying to develop a sense of ownership of the APEC process within the business community - an unenviable, but crucial task, Romulo says.

"Business people have to give a different perspective. They are a 'reality check' to senior officials."

Steve Marshall, chief executive of the New Zealand Employers Federation and NZPECC board member, agrees it's not going to be easy, but believes it's of critical importance to get the message to Kiwi business people. Spurred by Romulo's visit, Marshall this week met with Ministry of Foreign Affairs and Trade officials.

Measures coming out of this meeting include:
o Bringing together the various New Zealand organisations with membership that could be interested in the results of APEC to coordinate APEC-related activities. It was suggested the government facilitate this meeting, which would include groups such as NZPECC, ABAC, the Employers Federation, the Pacific Basin Economic Council (PBEC), and the Chambers of Commerce;
o Publishing a monthly APEC update column in the 15,000-strong circulation Employers Federation newsletter;Organising a series of roadshows in provincial centres to talk about APEC benefits and get feedback from local businesses.

"We have to make business somehow understand it's not academic policy stuff. It's a major event for New Zealand and there is the potential over the next 12 months for it to have a powerful short term impact on the domestic economy. There are policy benefits in the mid-to-longer term, but also benefits in terms of on-going business development, of networking and contacts leading potentially to better business in the Asia Pacific region… There are critically important potential changes and potential benefits for APEC to be successful, to consolidate Bogor and to move forward."

"New Zealand has to say that liberalisation and openness must continue, and what's going to make it happen is the business people," Romulo says. "It's important government officials make the private sector understand the benefits of open regionalism."

If it's been hard in the past to get business leaders to embrace APEC's trade and investment liberalisation and facilitation agenda, New Zealand's job is made doubly difficult by the likely emphasis in 1999 on APEC's other strand - economic and technical cooperation, or Ecotech.
But again, Romulo is convinced the only way to get the Ecotech agenda to work, is for it to be led by the private sector. And the only way to get the private sector interested is to appeal to the business person's greed, or "enlightened self-interest."

"Ecotech is a fluffy concept. People think it's aid and charity. But economic and technical cooperation is necessary for regional prosperity and if it's going to work it's going to need the support and understanding of the business sector.

"You have got to convince the APEC community that if you make people richer, in 10 years you will have a bigger market. So it's important for them to support programmes to uplift the masses."

One example where this win-win situation could work would be the case of a drug company in one country with expertise in a particular tropical disease, helping the government of another country train doctors and set up programmes to deal with that disease, in return for contacts within the right ministries, leading to drug sales further down the track.

The APEC Business Advisory Council is in the preliminary stages of establishing a foundation with funds from the private sector to investigate areas where the enlightened self interest approach could bring business and economic and technical cooperation together.

An initial project being looked at is a computer network allowing small and medium-sized enterprises in APEC economies to access short courses in, for example, management, or the Year 2000 problem. This could be sponsored by one of the computer giants - IBM, Digital, or Hewlett Packard perhaps - which would potentially reap benefits later through sales to the companies that signed on for training.

There is no reason, Romulo says, why New Zealand government and officials shouldn't have a lot to offer - and to gain - from the Ecotech idea. New Zealand has knowledge and expertise in government, corporate and banking restructuring, and is also well-known worldwide in areas such as afforestation and the environment.

He points to the fact the Philippine Long Distance Telephone Company, the largest telco in the country deals with New Zealand Telecom and uses its software.
"In a sense that's economic and technical cooperation," he says.

"But convincing companies to spend money now in anticipation of rewards as much as 10 years down the track is a long process and difficult, because your [business] constituency says: 'Why are you wasting all that money'."

PECC is an independent, policy-oriented organisation of high-level business, academic and government representatives from 22 Asia-Pacific economies. It aims to foster economic development in the region by providing a forum for discussion and cooperation in a range of economic areas. PECC is the only non-governmental body among the three official observers in APEC, where it has a policy advisory role.

* Nikki Mandow is manager of external relations at the University of Auckland's New Zealand Asia Institute.