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Asean members warn of backlash on mega-mergers

BANGKOK: Southeast Asian countries said on Saturday they were concerned about developing nations being hit by a backlash from a current global trend for mega-mergers and acquisitions.

Leaders of the Association of Southeast Asian Nations (Asean) said at a meeting with U.N. Secretary General Kofi Annan that because of this, alternative strategies for global economic development had to be found, a spokesman told reporters.

The meeting was held on the sidelines of a four-yearly summit of the U.N.'s trade and development agency UNCTAD which began on Saturday.

Asean groups Malaysia, Singapore, Thailand, Vietnam, Brunei, Laos, Myanmar, Cambodia, the Philippines, and Indonesia,

Malaysian Prime Minister Mahathir Mohamad said at the meeting that "these mergers could result in a domestic backlash against globalisation," the spokesman, Kobsak Chutikul of Thailand, said.

Mahathir was concerned that such mergers and acquisitions could create giant multinationals that could gain superior advantages over smaller domestic companies in various fields.

Singapore's Prime Minister Goh Chok Tong told Annan that big mergers could provide a backlash by taking multinationals' focus away from social safety nets.

Since the beginning of 2000, there have been two notable world megamergers the $151.80 billion AOL and Time Warner deal in the United States and the German company Mannesmann's $176.50 billion merger with Vodafone Airtouch of Britain.

At the meeting, Foreign Minister Win Aung of military-ruled Myanmar asked for help from the U.N. and other international organisations in creating conditions for greater democratisation in the country, according to the spokesman.

Thailand's premier Chuan Leekpai suggested to Annan that ASEAN be given observer status at the United Nations, the spokesman added.

Annan told the 10-member grouping's leaders that there needed to be a structured way for Asean and the United Nations to collaborate in the future. He later invited Asean to attend the next U.N. meeting in June as an observer.-Reuters