BANGKOK, Thailand, Feb. 26--Asian economies face new threats that could destabilise the region, despite the current boom that resulted from success in overcoming the 1997 financial crisis, a top UN official said Monday.
Some of the risks now facing the region are similar to those that preceded the 1997 crisis, which began in Thailand and spread around Southeast and East Asia, said Kim Hak-Su, the head of the UN Economic and Social Commission for Asia and the Pacific.
A global liquidity bonanza, inflated asset values, and tremendous speculative pressures on regional currencies could again destabilize regional economies, Kim said.
“Globalisation, along with its many benefits, exposes economies to quick and harsh risks from the constantly shifting international environment,“ he said in a speech opening a conference on the 10 years since the 1997 meltdown.
According to AFP, Kim urged governments around the region to ensure flexibility in exchange rates, adding that central banks should also be clear about their exchange rate policies.
“Greater flexibility would help take away the ’one-way bet’ that encourages even more capital inflows than would otherwise take place, since markets would quickly realize that the currency could move in either direction,“ he said.
Kim said countries around the region could weather future shocks by ensuring solid macroeconomic fundamentals, developing healthy financial sectors, having robust microeconomic foundations, and improving regional cooperation.
Thailand was the epicenter of the 1997 meltdown when excessive borrowings in US dollars coupled with high interest rates forced the Thai government to float the currency, which then promptly collapsed along with the economy.
The baht nosedived to 56 to the dollar from 25, took the Thai economy with it and then sent a tidal wave of debt and default sweeping across the region which cost billions of dollars to put right.
Over late 1997, the contagion spread unchecked, hitting Southeast Asia first, with Malaysia and Indonesia the worst affected as their currencies and then economies crumpled before the onslaught.
Then it was the turn of South Korea--an apparently strong economy whose Achilles heel of massive debt forced the government to go to the International Monetary Fund for a huge and humiliating bailout.
All the while, the shockwaves reverberated around the region, sparking a concerted attack on the Hong Kong government’s cherished dollar-peg currency system in mid-1998.

From the mighty Mekong, Yangtze and Ganges to countless smaller waterways, Asia’s rivers sustain the lives of billions of people but breakneck development has put them under unbearable pressure.
Choked by sewage, silt and industrial waste, and made unrecognizable by dams and diversions, many have become biological “dead zones“ and others like China’s iconic Yellow River often no longer even trickle to the sea.
“Looking at development in the region, it’s going to get worse before it gets better,“ said International Rivers Network campaign director Aviva Imhof.
“The situation in China is probably one of the most dire in the region in terms of both river pollution and the massive changes to the river ecosystems as a result of dams and diversions,“ she told AFP.
Charges of water-stealing and infrastructure schemes that parch downstream nations are traded back and forth. And many of the allegations, like the rivers themselves, go upstream to China.
Flowing from the Tibetan Plateau, China’s main rivers include the Yangtze and Yellow, the Yarlung Tsangpo which becomes the Brahmaputra, the Langcang which turns into the Mekong, and the Salween and the Irrawaddy which flow through Myanmar.
The Yangtze and the Yellow become heavily polluted as they flow through greater China, and populations downstream of the other rivers complain that hydroelectric dams arrest their flow after they leave the country.
India and Bangladesh are concerned about a plan to dam the Yarlung Tsangpo and use the electricity to pump river water vast distances over Tibet to the head waters of the Yellow river.
The plan, which would cost billions of dollars, is part of China’s ongoing plan to bring southern waters to the dry north, including the capital Beijing.
Already, the litany of damage to China’s rivers is daunting. The country is in the grips of an acute water shortage with around 300 million people reportedly lacking access to safe drinking water.
More than 70 percent of rivers and lakes are polluted, while underground water supplies in 90 percent of Chinese cities are contaminated.
The United Nations has declared the estuaries of the Yangtze and the Yellow to be “dead zones“ due to high amounts of pollutants which feed algal blooms that choke the water of oxygen.
And worsening pollution in China’s longest river, the Yangtze, is reportedly putting at risk the drinking water supply to millions of people in dozens of major cities.
After leaving China, the Mekong, one of Asia’s most evocative rivers, flows through Myanmar, Laos and Cambodia before reaching the South China Sea via Vietnam’s Mekong Delta.
The 4,000-kilometer (2,400-mile) river is one of the most biodiverse in the world, and the lifeblood for tens of millions of people living along its banks, providing fish, irrigation and a vital trading corridor.
But Beijing’s determination to turn southern Yunnan province into a hydroelectric power hub, which has already seen two dams built on the Mekong, threatens to have devastating social and environmental impacts.
The blasting of rocks and rapids in the upper reaches of the Mekong to create a navigation channel for huge ships is also causing concern.
Myanmar, under military rule since 1962, last year forged an agreement with Chinese and Thai companies to dam the Salween River, Southeast Asia’s longest undammed waterway which is home to 80 rare or endangered animals and fish.
India’s most famous river, the 2,510-kilometer (1,556-mile) Ganges which rises in the Himalayas, is so polluted by industrial and human waste that even those who revere its waters now fear it.
India’s Central Pollution Control Board found that the number of coliform organisms--an indicator of the presence of fecal matter--at one site at the start of a major bathing festival was 16 times that acceptable for swimming.
With water poorly managed and increasingly scarce in India--the World Bank has predicted a severe crisis by 2050--the nation is keeping an eye on what its neighbors are planning for the rivers that it relies on.
Climate change, large populations and the increase in water-guzzling heavy industries in India and China are likely to exacerbate tensions over shared rivers between the two Asian nations.
In Bangladesh, at least a fifth of which floods each year, the effects of the 230 rivers which cross-cross the low-lying country are particularly acute.
Bangladesh blames the shortage of water on its power-hungry neighbour India which it says has used dams and barrages to divert water upstream from shared rivers for irrigation projects--a charge India rejects.

The gap between China's rich and poor widened at a time when the nation was enjoying fast economic growth and vast wealth creation.

BEIJING, Feb. 26--China has pledged to make more housing available for poor families, even as it struggles to control soaring property prices, AFP quoted state media as saying on Monday.
“It’s the government’s responsibility to solve the basic housing problem of the low-income group,“ the China Daily reported, citing unnamed participants at a recent Cabinet meeting on the property market.
Vice Premier Zeng Peiyan said steps should be taken to build more housing that low-income families can afford, the paper reported.
This is official policy all across China, but so far more than one fifth of the nation’s 657 largest cities have failed to start construction of cheap housing, according to the paper.
Zeng warned that property prices were rising too fast, regardless of the government efforts, which also include strengthened land appreciation tax collection on developers.
“Property prices in some cities are still rising too rapidly due to insufficient supply of medium and low-cost housing,“ Zeng said, according to the official Xinhua news agency.
Last month, housing prices in 70 large and medium cities rose 5.6 percent year on year, with those in Beijing jumping 9.9 percent, the China Daily said, citing the National Development and Reform Commission.

A Kenyan farmer tends to his coffee plantation in Mukuruweini Nyeri, 120 km northwest of the Kenyan capital Nairobi.

BANGALORE, India, Feb. 26--Coffee-growing nations risk killing a nascent price recovery should they boost production to take advantage of a fall in Brazilian output, a top industry executive has warned.
Brazil expects production to fall by eight to 10 million bags from last year’s 41.5 million bags--at least 20 percent--when it harvests the next crop in April-May, said Nestor Osorio, executive director of the International Coffee Organization.
“The market is going to be short of coffee because stocks are already at the lowest point in history,“ Osorio told AFP in Bangalore, where he attended the three-day Indian Coffee Festival ending Sunday.
The Colombian-born official forecast production for the next crop year at 110 million bags, each weighing 60 kilos (132 pounds), and demand at about 120 million bags, a deficit he said will likely extend the recovery after a crisis that started in 2000 when coffee prices fell below production cost.
According to AFP, Brazil is the world’s biggest producer with a 25 percent share--followed by Colombia and Vietnam--and determines the fate of a market on which 25 million farming families in 60 countries depend for their livelihood.
A debilitating winter frost withered the Brazilian crop in 1994, chilling the international coffee market and causing prices to shoot up as high as two dollars a pound.
Rival producers planted more coffee in the late 1990s and Vietnam tripled its output of low-cost, low-quality Robusta variety, leading to excess supply and the crisis of 2000, when prices fell to as little as 60 cents a pound.
The value of exports plunged to five billion dollars in 2001 from 12 billion dollars in 1996, but recovered to 10 billion dollars last year.
Now, coffee is priced at one dollar and five cents a pound, a little above production cost, based on a composite indicator price compiled by Osorio’s organization--still only roughly half its peak price.
In India, which exports three-fourths of its coffee output, some growers committed suicide to escape the burden of mounting debt.
Coffee is one of the world’s most heavily traded commodities and for many developing countries second in value only to oil as a commodity source of foreign exchange.
Among consumers, coffee accounts for $70 billion in retail sales.

HAVANA, Feb. 26--Cuba has opened an experimental wind farm, hoping alternative energy sources can one day ease occasional power shortages while reducing the island’s dependence on oil, AP quoted state news media as reporting Sunday.
The US$3.4 million (2.6 million euros) park, featuring six, 55-meter (180-foot) windmills and known as “Los Canarreos,“ was established on Isla de la Juventud, an
island south of Havana, according to the Communist Party youth newspaper Juventud Rebelde.
Exactly when the park was inaugurated was unclear, but officials estimate that during its first year of operation it could produce 1,800 megawatts of electricity. That would save Cuba about US$136,000 (103,000 euros) in oil costs on international market, the newspaper said.
The park was built using French technology, and its windmills are designed to be disassembled quickly in case of hurricanes or tropical storms.
Officials hope to finish work on another wind park with six windmills located in the eastern province of Holguin by the end of the year.
The collapse of the Soviet Union sparked widespread energy shortages in Cuba, and while things have improved since then, blackouts are still sometimes a problem during the scorching summers months.
Cuba produces its own oil and natural gas, but domestic production is not enough to meet its energy needs. An agreement with oil-rich Venezuela allows the island to buy
nearly 100,000 barrels of oil a day under preferential terms, while Cuba sends thousands of volunteer doctors to Venezuela who offer free care to the poor.

WASHINGTON,
Feb. 26--The World Bank and Caribbean nations are exploring the creation of a new fund to insure island nations against hurricanes and other natural disasters, reported AP.
Representatives from 18 Caribbean countries are gathering Monday in Washington to discuss the bank’s first program to offer the insurance, which would provide countries with immediate liquidity in the event of a natural disaster.
Each participating country will pay $1 million (760,000 euros) annually in exchange for up to $30 million (22.8 million euros) in coverage, according to World Bank officials.
The International Development Association, the bank’s low-interest lending arm, has pledged $27 million (20.5 million euros) in funding. But another $30 million (23 million euros) is needed to get the program going.
The World Bank hopes to collect some $50 million (38 million euros) from donors, including the European Union, France and Canada, which will send representatives to the conference. World Bank President Paul Wolfowitz will preside over the talks.
The bank aims to make the insurance available for the upcoming hurricane season, which starts in June.
The program will serve as a model that could be used in other regions with small countries, said Caroline Anstey, the bank’s director for the Caribbean.