They also agreed China will become one of the most important international capital centres in the region, a move that could offer much lifeblood to the economic development in the APEC region in the coming decades.

"The 1997 economic crisis exposed many problems in the Asian financial systems, such as undercapitalization, poor regulation, inadequate accounting and disclosure," said Joseph Gasper, president of the Nationwide Financial Services Inc.

Following the example of equity markets in the United States and Europe, most Asian economies experienced an economic slowdown starting late last year that was also reflected in the equity markets and their performances as most of these economies are heavily export-reliant.

"We are facing a long drawn-out adjustment in the capital markets that could last for the next 12 to 24 months," said Ramon del Rosanrio, chairman and chief executive of the Philippines-based AB Capital and Investment Corp.

But he also said the adjustments "can be an opportunity not only for individual enterprises but for entire industries and economies to extract greater efficiencies and, eventually, more rapid growth in the future."

He said member economies must overcome these current problems and persevere in their efforts because the opportunities that are offered by the New Economy are real.

"I believe the equity market in Asia in the future is promising and sound not only because all the economies will depend on the capital market for financing, but also because of the largest investor base and increasing investment demand in the coming decade," said Laura Cha, vice-chairwoman of the China Securities Regulatory Commission.

"The development goals of Asia in the medium and long term can be best served if we develop a vibrant and truly Asian capital market, which is closely integrated with the global financial market," said Rosanrio.

The most profound factor that will influence APEC's capital market is the evaluation of a new Asian economic structure in the next decade, according to Cha.

"We have to look beyond the doom and gloom of the moment and fix our sights on the real opportunities that the New Economy has opened for the region," said Rosanrio.

He stated that the region needed a vibrant capital market to sustain investment.

"The September 11 attacks have reminded us that cooperation is the key in the area of business and economic growth as well as international safety and security," said Gasper.

"I think China should and will play a key role in the region as it has a deep and fast growing pool of savings that can be leveraged to make it one of the most important capital markets in Asia," said Rosanrio.

Being the third largest equity market in Asia after Japan and Hong Kong SAR of China, the Chinese mainland will continue its efforts to further reform its capital market, said Laura Cha.

Despite a robust domestic growth of the economy, the Chinese mainland's equity market has also witnessed a downturn this year after a bull run in the past several years.

Cha said these measures include strengthening the establishment of the regulatory framework, improvement of governance and an upgrade of intermediary firms.

While continuing to tap the significant investment opportunities that are present in the Chinese mainland, mainland financial institutions will have an increasing role to play in mobilizing capital for the entire Asian region, and globally as well, said Rosanrio.

(Xinhua News Agency 10/21/2001)