U.S. Spars With Summit Host Over Currency Crisis, Rights Manifesto

In a confrontation with an increasingly important ally, the United States on Monday bluntly castigated Malaysia on highly sensitive economic and diplomatic issues during Secretary of State Madeleine Albright’s final day of talks with leaders of the Assn. of Southeast Asian Nations, or ASEAN.

Senior U.S. officials angrily rebutted claims that American businessman and philanthropist George Soros is responsible for Southeast Asia’s currency crisis, a charge made by Malaysian Prime Minister Mahathir Mohamad in a series of blistering attacks during the annual ASEAN summit here.

Albright also personally took on Mahathir on Monday about his proposal to modify the United Nations’ Universal Declaration of Human Rights, which he said, over the weekend, had been formulated by the superpowers half a century ago and is not suitable for developing countries today. In a vigorous response, Albright told ASEAN leaders that she would be relentless in opposition to any amendments to the declaration.

The flap over Soros, who some Southeast Asian nations say launched a speculative attack on their currencies in an unsuccessful effort to keep ASEAN from admitting Myanmar, formerly Burma, because of its poor human rights record, has become particularly nasty in recent days, despite quiet U.S. attempts to persuade ASEAN that he is not masterminding a regional economic upheaval.

Several of ASEAN’s nine members have plunged into economic crisis, with the drop in their currencies ranging from 5% in Malaysia to 20% in Thailand against the U.S. dollar in recent weeks. Indonesia, the Philippines, Myanmar and Laos are struggling with similar situations.

Soros has denied that his Open Society Foundation, which promotes democracy in Myanmar, has any connection with or influence on his financial dealings.

Mahathir fired the first round at ASEAN’s opening session Thursday. “Our economic fundamentals are good, yet anyone with a few billion dollars can destroy all the progress that we made,” he said, without being specific.

“We are told we must open up, that trade and commerce must be totally free. Free for whom? For rogue speculators. For anarchists wanting to destroy weak countries in their crusade for open societies, to force us to submit to the dictatorship of international manipulators.”

On Saturday, Mahathir called Soros a criminal, compared him with drug traffickers and accused him of sabotage--triggering banner headlines and much public attention. Other Malaysian officials have since referred to Soros as evil and villainous.

At ASEAN on Monday, Stuart E. Eizenstat, U.S. assistant secretary of State for economic and business affairs, responded that Malaysia had no evidence to back up its claims. “Experience suggests that market movements are not dominated by a small number of currency speculators, let alone one person who happens to be a U.S. citizen,” he said, citing 1992 European currency fluctuations and the 1994 peso crisis in Mexico, which wreaked havoc on markets in those places.

State Department spokesman Nicholas Burns later called Soros “an honorable individual who’s done a lot of good around the world.” Financial failings can usually be traced to policies inside a country, he added.

Soros has openly opposed Myanmar’s entry into ASEAN this year but in a statement released in New York denied targeting ASEAN economies. “I continue to consider the acceptance of a totalitarian and repressive regime a threat to the region’s prosperity and stability,” the statement said. “However, I do not believe the cause of freedom in Myanmar would be advanced by linking it to currency speculation.”

The issue of changing the U.N. human rights declaration also emerged over the weekend amid fanfare and banner headlines, which led to predawn meetings within the U.S. delegation to come up with a response. Mahathir suggested that changes in the document should be part of current U.N. reforms.

The Malaysian leader said the priority of developing countries is “stable government” rather than freedoms in order to provide for the “basic needs of our people.”

In a special session between the United States and the nine ASEAN leaders Monday, Albright--formerly U.S. ambassador to the United Nations--denied that the U.N. principles were imposed by the West on the rest of the world; she insisted that they were produced after the deaths of millions during World War II in the name of preserving freedom. Changing one of the key documents of the postwar world or watering it down to make it more convenient for developing countries, she added, would be a grave mistake.

Burns, the State Department spokesman, insisted that the two countries are still on “very good” terms. The United States, for example, is Malaysia’s largest export market. He called Malaysia a “dynamic country with a great future” and said the United States has “a lot at stake” in the relationship.