Asian Competitors : ‘Tigers’ Bite Hurts, West Complains
Unseen and unheard, they were not guests at the annual economic summit conference. But Asia’s four “tigers”--the newly industrializing countries of South Korea, Taiwan, Hong Kong and Singapore--were not ignored.
“Something needs to be done with the NICs,” said Willy de Clercq, external relations commissioner for the European Economic Community. “They need to be more integrated with the world economy.”
Integrated, yes. But on whose terms?
The United States, as the largest market for goods from the new Asian exporters, has led the charge to force changes in the NICs. Many top U.S. officials insist that the two largest tigers, Taiwan and South Korea, must rapidly tear down their protectionist barriers and stop undervaluing their currencies.
Americans often complain that the NICs are “free riders” in the world trading system, exporting aggressively while only grudgingly allowing foreign goods into their markets. Europeans object that the four, by making rapid inroads into such basic industries as textiles, steel and shipbuilding, are disrupting established trade patterns.
Defenders of the NICs
Japanese officials, on the other hand, see themselves as defenders of the Asian exporters. The tigers, the Japanese contend, are still only cubs, and should be nurtured rather than forced to grow up too fast.
The four tigers “are being criticized as a threat to the rest of the world just because their trade surpluses have been swelling at an astonishing speed,” Hajime Tamura, Japan’s minister of international trade and industry, said here Monday. “We should not nip the growth of burgeoning nations such as these in the bud.”
Japan, unlike other major industrial nations, runs a trade surplus with the NICs, but it has recently begun to expand its imports from them at a rapid pace.
Already, the NICs have produced at least one minor diplomatic flurry. At the instigation of China, which objected to the term “NICs” on the grounds that Hong Kong and Taiwan are not full-fledged countries, Japan began a move to call them “NIEs,” or newly industrializing economies.
More fundamental questions remain unresolved. Last month, at a prelude in Paris to the summit conference, the Japanese objection to earlier “NIC-bashing” produced a statement calling merely for “discussions . . . recognizing mutual interests” between the major industrial powers and the newly named NIEs.
NICs ‘Are Mature Societies’
The softer approach, though, has not done much to curb U.S. officials. In a briefing last week, Clayton K. Yeutter, Reagan’s chief trade negotiator, insisted that the rising Asian economic powers “are mature societies that must recognize their responsibilities to the world.”
And Treasury Secretary James A. Baker III insists that there has been no softening in the overall approach to the tigers. He told reporters Monday that the major industrial powers will “call for a constructive dialogue with the newly industrializing countries.”
Analysts contend that there are major flaws in the industrial powers’ approach to these countries.
“Our idea of including the NICs in the international economic process is often nothing more than wanting to tell them what to do,” said Alan Stoga, senior economist at Kissinger Associates in New York. “All we tend to offer them is pain, which means they aren’t really willing to belly up to the bar.”
The United States, Stoga said, needs to guard against Japanese efforts to become the intermediary between the NICs and the industrial powers.
Complicating the relationship with the NICs is the uncertain political status of Taiwan and Hong Kong. Hong Kong, a British colony, is scheduled to become part of China in 1997. Taiwan has formal diplomatic ties with only about two dozen nations.
