Financial crisis unites Asian nations
Japan, China, South Korea to cooperate
FUKUOKA, Japan - Japan, China, and South Korea agreed at a North Asia summit yesterday to increase cooperation to tackle the global financial crisis, putting aside decades of animosity.
The three leaders - Premier Wen Jiabao of China, Prime Minister Taro Aso of Japan, and President Lee Myung-bak of South Korea - also agreed on the need to act together to push forward multilateral talks aimed at halting North Korea's nuclear program. Negotiations in Beijing failed to make progress on the issue last week.
Japan's ties with its neighbors have been plagued by bitter memories of Tokyo's past military aggression. But the focus was on cooperation at the summit of North Asian leaders, their first three-way meeting to be held separately from an annual Southeast Asian meeting.
"China, Japan, South Korea, as important economies in Asia and in the world, must deal with this once-in-a-century situation. We must talk with each other, make adjustments in our macro-economies and have financial cooperation in East Asia," Wen said at a joint news conference after the talks in this southern Japanese city.
The leaders confirmed the importance of steps to expand demand, pledged not to create trade barriers over the next 12 months, and backed efforts to bolster a regional network of currency swaps. But they unveiled no new specific steps.
The summit of the three North Asian countries, which account for 75 percent of the region's economy and two-thirds of its trade, follows the collapse of a bailout for US auto makers that sparked sell-offs in global stock markets and sent the dollar to a 13-year low against the yen.
On Friday, Seoul, which has suffered the most of the three countries from the crisis, agreed to new currency-swap deals with Tokyo and Beijing worth the equivalent of nearly $50 billion. It is the latest effort to stabilize an economy the central bank says is set for its slowest growth in over a decade.
South Korea, where the won currency has lost about one-third of its value against the dollar this year, has offered $130 billion in measures to shore up its banking system and another $25 billion in fiscal spending and tax cut plans to try to prevent a recession in its export-driven economy.
Its central bank has slashed interest rates to a record low, while promising to do more if needed.
Japan said Friday that it would expand its stimulus plans and bolster a war chest for bank rescues to $131 billion, but kept markets guessing on whether it would intervene to stop a surging yen from pushing the economy deeper into recession.
China, threatened with a slowdown in its dynamic economy, launched a $586 billion stimulus plan on Nov. 9 and on Wednesday pledged to boost public spending and cut taxes to reach growth goals.
"Stable development of the Chinese economy will lead to financial stability and bears an important significance for economic development in the region," Wen said.
On the security front, the three leaders agreed on the need to coordinate efforts to persuade Pyongyang to abandon its nuclear arms ambitions, with Aso and Lee condemning the North's stubborn stance on verifying its past programs.
Yesterday, North Korea threatened to slow down disablement of its main nuclear facility after Washington said energy aid to the state had been suspended because of the failed talks.
But Lee urged patience. "It may take a long time and it requires patience from many countries. But I believe [solving the issue] will surely and should be achieved in the end," he said at the news conference.
Despite yesterday's show of unity, bilateral feuds still simmer. As the summit began, a small group of Japanese right-wing activists gathered near Fukuoka City Hall to protest against the meeting and demand the return of disputed territory.
Aso told Wen the intrusion of two Chinese survey ships into waters near disputed islands in the East China Sea that are thought to lie near potential oil and gas reserves was very regrettable and urged Beijing not to let it happen again so as not to damage overall Sino-Japanese ties.
Wen reiterated that the territory belonged to China but added that the matter should be resolved through dialogue.
Lee and Aso steered clear in their talks of a long-running dispute between South Korea and Japan over another remote crop of islets that lie near fertile fishing grounds and possible maritime deposits of natural gas hydrate that could be worth billions of dollars.
Sino-Japanese relations have warmed since the deep chill when Junichiro Koizumi, Japanese prime minister from 2001-2006, offended Beijing with visits to a Tokyo war shrine. South Korea's Lee has pledged to improve frosty ties with Japan. 