A prediction by the
Organization for Economic Cooperation and Development in Paris that financial
turbulence in Asia may cut nearly 1 percent off the output of industrial
countries around the world next year made headlines in many European
newspapers, which were happy to note, however, that U.S. growth should slow
down from 3.8 percent to 2.7 percent, while Europe's should creep up from 2.6
percent to 2.8 percent. But the OECD pointed out that the European Union's
better performance was predicted only because Germany was expected to do well,
with its GDP rising 3 percent next year, and warned that, in any event, all
forecasts will have to be revised as the turmoil continues.
The worst
economic damage was predicted, of course, for Asia itself, and especially for
Japan, where Asahi Shimbun Monday reported a major fall in business confidence, with the Tankan
quarterly survey showing that the index of confidence among major manufacturers
had fallen from +3 percent three months ago to -11 percent now. The newspaper
blamed the publication of the survey for a fall by the yen against the dollar
to its lowest level since May 1992.
But the news from South Korea seemed to be getting a little
better. The South China Morning
Post of Hong Kong said, in contrast to reports elsewhere that the United
States had already rejected the South Korean government's request for an early
release of some of its expected international bailout funds, that President
Clinton had told President Kim Young Sam that he personally supported the
request because he believed that South Korea was abiding by the demands for
government-spending cuts and other financial reforms made by the International
Monetary Fund. The South Korean government news agency also said that the IMF
had now agreed to consider the matter.
But the
Financial Times of London
reported that the first day of the 12-nation Asian summit meeting in Kuala
Lumpur had been dominated by growing dissatisfaction--most strongly expressed
by Malaysia and China--with the conditions imposed by the IMF on its Asian
supplicants, Thailand, Indonesia, and South Korea. The Malaysian foreign
minister, Abdullah Badawi, was quoted in the FT as saying that the IMF
should show flexibility rather than simply impose on Asian countries the same
type of conditions it demanded of Mexico in 1994. You shouldn't automatically
give the same kind of painkiller to everybody, he said. Meanwhile, reported
London's Daily Telegraph, thousands of protest marchers in Seoul
were demanding imprisonment for President Kim and renegotiation of the rescue
deal imposed by the "colonial" IMF.
Another deeply discontented country was Turkey,
which, after 34 years of struggle to be accepted as a potential member of the
European Union, was told by the European summit in Luxembourg last weekend that
it still isn't considered a suitable candidate. The Turkish government said it
was freezing political relations with the EU and indicated that it wouldn't
attend a pan-European conference in London next March because of the "biased,
prejudiced and exaggerated assessments" of its record on human rights, Cyprus,
and minorities.
The
Turkish Daily News quoted British Prime Minister Tony Blair as bizarrely describing
the EU communiqué on Turkey as "[a] way for Europe not to turn its back, but
its face to Turkey," and an unnamed EU spokeswoman as saying, even more
bizarrely: "If this was a fair world, Turks would have been rejoicing in
Ankara." But an opinion column by Sirma Evcan in the Turkish
Daily
News said that "[e]ven the strongest defender of the EU in Turkey cannot
swallow the Luxembourg Summit communique which says nothing new, gives no hope.
It is just a new version of telling Turkey: You are not one of us, but you may
go on trying your best to become so in the unforeseeable future."
In London, last week's court decision on Microsoft was the
subject on Monday of an editorial in the Financial
Times and a
thunderous opinion column in the Times. The FT said Judge Thomas Penfield Jackson's ruling
might "mark a watershed in the company's history--the point at which
Microsoft's effective monopoly of personal computer operating systems moves
firmly into the ambit of the law." "Increasingly," it predicted, "Windows will
be a product shaped as much by the courts as by its programmers'
imaginations."
In the Times ,
columnist William Rees-Mogg wrote: "Last January Bill Gates was still generally
seen as a benefactor of mankind, who had developed new and efficient software
to spread the advance of electronic communications. Now, this December, Mr.
Gates is widely seen as a systematic monopolist of communication software who
is exploiting the information age. ... His critics attack Bill Gates, as their
critics attacked the old monopolists, as a 'malefactor of great wealth.' " Lord
Rees-Mogg said that "[t]he precedents under American law are that Microsoft
will not be allowed to expand, or even retain, its present degree of monopoly,"
and he suggests that Gates take a leaf out of the book of John D. Rockefeller
who, in his later years, consulted a public-relations firm and "took to giving
out dimes to children in the street in order to soften his image as a
hard-hearted businessman." The column concluded: "The best advice one can offer
Bill Gates is to start handing out money to children; I know he will need to
offer them dollar bills rather than dimes."
