POINT OF VIEW/ Ling Xingguang: Japan should promote 'ASEAN plus 3' platform

Prime Minister Yukio Hatoyama's vision of an East Asian community was warmly welcomed by Southeast Asia and China. But, with its details unclear, enthusiasm for the proposal in the region is fading.

The critical question is what the regional framework of the community should be. It is impossible to push forward with any vision without sorting out this essential issue.

I think Japan should promote the "ASEAN plus 3" framework to include the 10 members of the Association of Southeast Asian Nations plus Japan, China and South Korea. Such a grouping would serve Japan's interests and help build a new East Asian model of economic growth.

This new East Asian model would be a more sophisticated and internationalized version of the East Asian model that Japan spearheaded.

After World War II, Japan created a new model of economic growth that combined the central planning of a state-controlled economy with the market mechanism.

In other words, it was a government-led market economy.

The government played an important role in Japan's postwar economic development, mainly through the formulation of long-term economic plans designed as policy guidelines as well as industrial and social security policies. Unlike a country with a state-controlled economy, Japan pursued economic management based on market principles.

Japan's successful model of economic growth was adopted in Taiwan, South Korea and Singapore. It was applied to economic policymaking in ASEAN member countries and also in China after it started reforming and opening up its economy. Over time, the Japanese model earned international recognition as a key factor behind the East Asian economic "miracles."

As the U.S. model of capitalism based on the tenets of neo-liberalism started gaining influence in the region in the late 1990s, however, questions were raised about whether the Japanese model, which succeeded in individual nations, could be effective in this age of globalization.

The Japanese model was seen as outdated in Japan as well. China was also influenced by neo-liberalism, but it has basically adhered to the East Asian model invented by Japan.

Japan should have tried to create a new East Asian model by figuring out ways to refine and globalize the East Asian model. The new version would be a market economy model focused on international cooperation.

Under this model, an organization set up for international policy coordination, instead of the governments of individual countries, would formulate plans for developing cross-border infrastructures as well as industrial and environmental policies for the region. Economic entities in individual nations would be given business opportunities according to market principles.

Economic cooperation and aid to stoke growth of the less-developed countries would be given priority along with the liberalization of trade and investment so that economic gaps among countries in the region would narrow.

This new Asian standard model would be lauded and embraced around the world. Japan is about to lose its quantitative advantage over China, but it will maintain its qualitative advantage for 30 to 50 more years.

Some people argue that the ASEAN plus 3 forum will provide an arena for China to seek hegemony. But China will continue to need cooperation from Japan for the time being because it is still short of experience and intellectual resources.

The global financial crisis has brought to the fore some serious flaws with the so-called Washington Consensus, or market fundamentalism as advocated by the U.S. government. The situation offers a great opportunity for the ASEAN plus 3 group, which built its economic prosperity on the basis of the East Asian model, to create a new East Asian model.

Japan could lose this strategic opportunity if it avoids committing its support for this framework. I hope that the Hatoyama administration will show a clear and solid commitment to promoting it.

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The author is chief director of Japan-China Science, Technology and Culture Center, based in Tokyo.