Thu, May 08, 2003 - Page 8 News List

SARS poses big threat to regional stability

By Holmes Liao 廖宏祥

In this increasingly interconnected world and global economy, instability in another part of the world can lead to conflict that can have a direct impact on us.

Security experts have long listed tuberculosis and AIDS, among other diseases, as a threat to national security. In the US, the CIA in January 2000 labeled AIDS a non-traditional threat to national security.

AIDS primarily affects certain high-risk groups. But SARS may impact domestic consumer confidence, reduce the work force, and even destabilize govern-ments. Some states will impose embargoes and travel and immigration restrictions, which makes illness an international security issue.

In the months to come, before SARS is brought under control, we shall see economic growth in Asia begin to erode. Normal economic activities will cease to function while the cost of the disease to the government becomes overwhelming.

Controlling the epidemic will intensify the struggle for political power to manage scarce state resources. As such, the relationship between disease and political instability may be indirect yet definitely indisputable. If not managed properly, the socio- economic setbacks resulting from SARS may undermine the achievements gained from Asia's development efforts in the last few decades. Such a reversal can be fertile ground for the seeds of civil or social unrest. Worsening social conditions can also create tension and even result in conflict among regional states.

If the pandemic continues for more than a year, SARS' chain reaction in China can be pre-dicted. Finding political scapegoats is only the beginning, yet it may result in a power struggle that will introduce instability to the relatively inexperienced leadership in Beijing.

Foreign direct investment in China will dry up swiftly. Domestic economic demands, which keep the economy going, will deteriorate rapidly. Consequently, problems such as non-performing loans, government deficits, unemployment, bank stringency and high interest rates will erupt in tandem. Once China's economic growth rate goes under 4 percent, the downward spiral may become uncontrollable. When these are materialized, only one question will remain -- when will the implosion, predicted by Gordan Chang, happen?

No two epidemics or terrorist attacks are the same. Yet governments must set up standard operating procedures to deal with issues such as quarantine and resource distribution. Similarly, we may foresee that new and re-emerging infectious diseases will pose a rising global threat and will complicate global security.

SARS endangers our citizens and exacerbates economic, social and political instability in key countries and regions in which Taiwan has significant interests. In addition to controlling SARS, Taipei will have to find ways to hedge against the worst-case scenario.

Taiwanese businesspeople in China will have to think hard and carefully about how to manage the risks induced by that country's total opaqueness, be it political, economic, or health-related.

Holmes Liao is an advisor to the Ministry of Foreign Affairs.

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