Play Ball Asia Faces Insolation

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INTERVIEW-Play ball Asia or face isolation-Holbroo

By Peter Humphrey 

HONG KONG, March 27 (Reuters) - Balkan trouble-shooter turned banker Richard
Holbrooke took aim at Asia on Friday when he said countries must embrace
international business rules or remain isolated like Myanmar (Burma) and North
Korea. 

Holbrooke said the Asian financial crisis marked the end of an era and the
excuse that "Asian values" were different was just a smokescreen for "crony"
economics. 

Holbrooke, vice chairman of Credit Suisse First Boston (CSFB), made his
remarks in an interview with Reuters at an Asian investment conference
organised by the bank in Hong Kong. 

Now responsible for CSFB's investment banking development in Asia, Holbrooke
was formerly U.S. assistant secretary of state. He brokered the end of the
Bosnian war in 1995. 

Holbrooke said Asian states must adopt international norms. 

"As the Asians enter the global marketplace they have to play by the same
rules as the rest of the world. If they want to remain completely isolated,
like Burma and North Korea, that's a different matter," he said. 

"Once a country enters the international economic system, it can't argue that
it has to be allowed to play by special rules which they then call 'Asian
values'," he said. 

"Asian values are universal values. Hard work, family, education, and the
Asian cultures are magnificent cultures but let's not confuse Asian values
with corrupt business practices." 

In separate remarks to the conference earlier, he called Asian values a
"smokescreen" for corrupt business practice. 

In the interview, Holbrooke said the Asian crisis marked an end to the
region's "Asian miracle" growth period but he expected the area to make a
vigorous comeback eventually. 

"I think it's the end of an era. At the end of this era there will be a period
of adjustment. It will take two to five years depending on the country. 

"But Asia will recover and will resume some time early in the next century its
dramatic growth," he said "I hope next time...the Asian economies will be more
transparent." 

Holbrooke backtracked from harsh criticism he had made about Indonesian
President Suharto earlier in the week. 

He said he was hopeful about the latest contacts between the crisis-torn
country and the International Monetary Fund. 

"The new Indonesian government has put together some workout schemes which
have the general support of the IMF and the United States," he said. "I'm very
hopeful." 

On Thursday Holbrooke told a television station that Suharto had gathered
family and cronies around him in the government and was obstructing an orderly
succession of power. 

But on Friday he modified his earlier comments and said: "We should work
closely with the Indonesian government and with its people. It's one of the
most important countries in the world. We have to work very positively with
it." 

Asked what kind of outcome could be expected from Jakarta's talks with the
IMF, Holbrooke said: "I'm hopeful the discussions which are taking place will
result in an acceptable workout scheme that will allow the IMF to continue its
support of the Indonesian recovery." 

But he saw lots of pain along the way. "A lot has to be done. Banks are going
to have to be closed. There's going to be some terrible dislocation and
unemployment." 

Some analysts have said they see light at the end of the tunnel in Asia's
crisis, but Holbrooke reserved judgment. 

"It's much too early to tell whether we've seen the bottom. But we also have
to differentiate between individual countries. The market has already made
that differentiation," he said. 

"The general consensus is that Korea's bottomed out. The Philippines has
probably bottomed out. Taiwan and Singapore can weather the storm. Thailand
seems to be turning around. 

"But I've heard some concern expressed about Malaysia, and then of course
there's still Indonesia which we watch with the greatest of attention and
concern."