In Hong Kong, the Twain Meet
International Herald Tribune
October 16, 1992
Laurence Zuckerman  

As nearly 400 of Europe and Asia's leading politicians and business executives sounded each other out Thursday at the first Europe/East Asia Economic Forum, Arthur Dunkel, director-general of the General Agreement on Tariffs and Trade, furnished some needed perspective.

"Some of the session themes sound as though these two parts of the world are only just discovering one another," Mr. Dunkel told the group. "But, in considering these views, I suggest that we all keep in mind that we are discussing perhaps the oldest continuing relationship in history."

Yet, despite at least 700 years of virtually uninterrupted trade dating back to the time of Marco Polo and increasing economic interdependence in recent years, Asian and European leaders appeared to meet as virtual strangers here.

Claude Smadja, director of the Geneva-based World Economic Forum, which is the meeting's chief sponsor, said that the first issue the participants needed to address was "the amazing lack of in-depth understanding and the benign neglect that characterize the perception these two regions have of each other."

Such a claim is all the more remarkable, he observed, given the fact that in the last five years East Asia has surpassed North America as Europe's largest supplier and its largest export market.

Indeed, East Asia's emergence as the third member of a global trade triumvirate and the attendant suspicion arising in the region over European unity, the North American Free Trade Agreement and the battle to conclude the Uruguay Round of GATT talks is the reason Mr. Smadja convened what he hoped would be an annual event.

"The strengthening of the Europe/East Asia 'weak link' in this triangle has now become an unavoidable priority challenge for economic as well as political decision-makers in both regions," he wrote in a briefing paper.

Just how far the two sides have to go was illustrated by the opening remarks of Prime Minister Mahathir bin Mohamad of Malaysia, who scolded Europe for "living beyond its means" and coddling its citizens.

"European uneasiness seems to suggest that Asia today is a more serious threat than even militaristic Japan in the first half of the century," Mr. Mahathir said.

At Thursday's sessions, where the links between Europe and Asia were supposed to be addressed in panel discussions, participants more often than not talked past each other.

Per Westerberg, Sweden's minister of industry and commerce, encouraged East Asian investors to join Europe in helping to rebuild the former Soviet Union and Eastern Europe. Then the former South Korean prime minister, Chang Soon Yoo, and Toshiaki Ogasawara, chairman of The Japan Times, each implored Europeans to invest more in developing Asia.

"Europe seems more interested in cultivating ties with traditional partners than in cultivating new partners in East Asia," Mr. Yoo said.

All the European panelists, including Lorenz Schomerus, director general of Germany's economics ministry, and Norman Tebbit, the former British Conservative Party chairman, expressed their unqualified support for free trade and vowed that Europe was not becoming "inward looking."

But a session entitled "A 'Fortress Europe' or Asia's promising partner?" quickly devolved into a discussion of the European exchange-rate mechanism and the Common Agricultural Policy, leaving Haruhiko Kuroda, Japan's deputy vice minister of Finance for International Affairs, out in the cold.

In the frankest comments, Etienne Davignon, president of Société Générale de Belgique, urged East Asians to be patient as Europe slowly makes progress unifying and opening up its markets.

"Free trade is not the normal response of most businesses," he said. "Protectionism is in no way a European disease. It is a general disease that happens each time the economy goes bad."

But few of the Europeans appeared to take seriously an earlier suggestion by Mr. Ogasawara that they should let others wait.

"Why don't you turn your attention to this region, make some money, and then turn your attention to Eastern Europe?" he asked.

Copyright © 2006 The International Herald Tribune