The Association of Southeast Asian Nations (ASEAN) member states will face challenging tasks against the backdrop of the huge geopolitical risk posed by the potential collapse of financial institutions in the United States and the European Union, Indonesian President Joko Widodo said on Wednesday
MOSCOW (Pakistan Point News / Sputnik - 10th May, 2023) The Association of Southeast Asian Nations (ASEAN) member states will face challenging tasks against the backdrop of the huge geopolitical risk posed by the potential collapse of financial institutions in the United States and the European Union, Indonesian President Joko Widodo said on Wednesday.
"The future challenges will remain very difficult. There is a huge geopolitical risk that financial institutions in the US and EU will collapse," Widodo said, addressing the 42nd ASEAN Summit, held from May 9-11 in the Indonesian town of Labuan Bajo.
Under the current circumstances, all member countries should strengthen their partnership in order to preserve ASEAN as an epicenter of global economic growth, he said, adding that the economic growth rates in the region are faster than the world's average, with the continuing increase in its population, including the middle class.
The Indonesian president's warning comes following a series of bank failures in the West, with Silicon Valley and another US bank, Signature, being the first lenders to collapse in March after a customer deposit run triggered by concerns about the solvency of the two institutions. The San Francisco-based First Republic Bank became the third casualty in the country's banking crisis in late April. Top US bank JPMorgan Chase bought assets and deposits worth over $330 billion that belonged to First Republic, which had struggled since the collapse of Silicon Valley Bank and Signature Bank in March.
ASEAN includes Indonesia, Thailand, Malaysia, Singapore, Brunei, the Philippines, Vietnam, Laos, Cambodia and Myanmar. A representative of Timor-Leste is also taking part in the summit, as the country may join the organization in the near future. The rotating chairmanship of the bloc is taken on by each of its member states for 12 months. In 2023, Indonesia assumed the chairmanship of ASEAN.
