Trade agreements:

Asia should fast track

To mitigate effects of another global crisis:

Asian countries should continue to fast track their recent trend among themselves towards having greater cooperation through trade agreements.

Hatton National Bank Chairman Rienzie T Wijetilleke said the Asian region will be safe and better with the utilisation of its internal resources and idle assets that will guarantee the prosperity for the future.

HNB Chairman Rienzie T. Wijetilleke

Addressing the Oxford Union in USA on “Challenges faced and challenges a head in emerging economies in Asia”, Wijetilleke said this situation presents an opportunity to the young and forward looking professionals to acquire required skills and get prepared to face similar situations.

He said it is important that everyone learns the techniques of optimal handling of resources belonging to others and understanding the risk’s involved in doing so.

“The problem of replacing the ageing population has to be addressed at international level as well as the Governments of the countries concerned to build human resource capital with equal strengths and resources to take over institutions and run them in an efficient manner.

“But the question is whether such young people will have the necessary skills to face these most challenging and complicating situations that prevail in managing organisations and institutions as well as resources belonging to people”, Wijetilleke said.

Referring to the occurrences in the last 18 months he said the true extent of globalization and the very high value the whole world has paid for encouraging integration between the financial systems and the real economy.

“It’s through a clear understanding of these crucial linkages that countries will be able to cushion any adverse effects of another crisis that the generation will or may face in the future”, he said.

Wijetilleke said the crisis commenced with the fall of property markets in the US and UK and the plunging of equity markets in the major stock exchanges.

“This situation did not directly affect the economic climate of some of the emerging countries for sometime.

But the deterioration of the strong and larger international banks overseas with whom the emerging countries have relationships naturally had a direct effect on the emerging economies”.

The present situation has caused wide fluctuations and decline in the gold, oil and commodity markets some of which were earlier considered healthy investments.

Export customers of these Asian countries who deal with western markets in garments, commodities, building material are already experiencing a down turn and no longer enjoy the volumes and margins in their exports as in the past and they also experience delayed payments. RK