Thai Deputy Prime Minister and Minister of Commevce Supachai Panitchpakdi, selected to be the next director-general of the World Trade Organization, recently spoke with an Asahi Shimbun reporter about the lessons learned from the Asian financial meltdown and Japan's role in making emerging economies less vulnerable to the forces of globalization. 　Following are summaries of the interview:

　The Asian economies ravaged by the crisis are on the mend. Japanese trade and investment in the region is also rebounding. In order to ensure economic regeneration of the region toward the early 21st century, however, continued reforms in these countries are important. I hope Japan will work together with them in pushing through the reforms.

　Thailand has learned several important lessons from the crisis. The main factors that contributed to generating the crisis are:
(1) the lack of flexibility in monetary policy;
(2) the excessive dependence on foreign funds, with a large portion being short-term funds that didn't contribute to trade; and,
(3) the swelling of the current-account deficit to a dangerous level.

　We don't blame banks for the crisis. But U.S. banks pulled 90 percent of their loans out of Thailand following the crash of the baht, and European banks withdrew 50 percent. In contrast, Japanese banks agreed to roll over their loans, keeping 90 percent of their funds in Thailand. We are very grateful for that.

　Still, we would like to see Japan make a more positive contribution than before in tackling international financial and currency issues, in particular through its role in the management of the International Monetary Fund.

　Why should the United States and Europe always exert leadership within the IMF? When Asian countries called for structural reforms of international finance, British Prime Minister Tony Blair lent his support. But the IMF did little more than set up a forum for discussions. The reforms we sought have made little headway. Japan should play the same level of role as that of any major Western country in the 21st century.

　Even more important is the internationalization of the yen. Until now, Japan's readiness to meet our demand for yen-denominated loans has been insufficient. Japan should reform its financial markets to promote the yen as a major international currency.

　Japan should also contribute to creating an organization like the proposed Asian Monetary Fund. Such a body could complement the IMF and may be used to supply aid to regions outside Asia. In addition to providing emergency loans, the organization could also have the function of developing financial markets.

　We want Japan to act as a catalyst in these fields. Its role would be to induce cooperation from the IMF and the United States.

　On the trade front, Japan has been performing a leading role for years. But consumers should not be victimized for the protection of the agricultural sector. I would like to say to Japan, ``be flexible'' in the new round of WTO talks.

　The bilateral free trade agreements Japan is discussing with some of its Asian trade partners including the Republic of Korea (South Korea) represent a good idea as long as they do not open a back door to countries not participating in multilateral trade liberalization. No country can afford to turn its back on multilateral systems in the global economy.

Supachai Panitchpakdi, 53, has a Ph.D. (Economic Planning and Development) from Erasmus University, Rotterdam. After working for the Bank of Thailand, he became Deputy Finance Minister, then President of Thai Military Bank, and since 1997 he has served as Deputy Prime Minister and Minister of Commerce. After competing with former New Zealand Prime Minister Mike Moore in the WTO Director-General election in 1999, it was decided they would share the post for an unprecedented three years each.