COPENHAGEN, July 6: EU and Asian finance ministers and officials gathering here on Friday for a meeting hosted by Denmark agreed that the global economy was recovering although Asian countries would need to carry out structural reforms to maintain strong growth.

But measures to combat terrorist financing and money laundering were also in the spotlight at the two-day Asia-Europe Meeting (ASEM), which started on Friday, as all participating countries backed actions to protect the international financial system.

Speaking after the first day of discussions, Danish Finance Minister Thor Pedersen said ministers and representatives attending the meeting had agreed that the global economy had passed a trough and “growth will accelerate in the second half of 2002 and 2003”.

He explained that Asian countries countries would return to robust growth rates although structural reform was needed to maintain such levels.

In respect to Asia the expectation is for growth rates to return above the global average. However, high growth rates can only be sustained through structural reform.

A Japanese finance ministry official, Hideharu Tanaka, said that Japan strongly backed structural reforms and was pushing ahead with its own.

Without structural reform we cannot achieve a desirable growth rate in the mid- and long-term, Tanaka told AFP, explaining that privatization of state-owned companies, deregulation and measures against unemployment were Japan’s reform priorities.

Denmark’s Pedersen noted that in Europe, continued structural reforms in product, labor and capital markets had helped sustain an upbeat economic outlook.

Such reforms would help European countries to benefit from strong macroeconomic fundamentals — low and decreasing inflation, healthy public finances and no major external imbalances.

Despite signs that an upturn in the global economy was on the way, the lingering threat of terrorist attacks poses a risk to global economic growth, officials said.

But the delegations meeting here all reaffirmed commitments to implementing measures to cut off terrorists finances as well as prevent money laundering.

Money laundering and terrorist financing are important threats to international society and calls for international cooperation to fight this abuse of the global financial system, Pedersen said.

He explained that cooperation was needed to be able to follow the trail of money through the global financial network although there had been no debate about implementing any particular system for this end.

Delegations from the 15 EU member countries and 10 Asian countries are attending the meeting

But the meeting, which is aimed at preparing for a fourth ASEM summit, to be held here in September, was marked by the absence of some ministers, although Pedersen denied this signalled a lack of high-level interest by some ASEM members.

Of the 25 ASEM member countries, only finance ministers from Austria, Belgium, China, Denmark, Finland, Greece, Indonesia, Japan, Malaysia and Thailand were present, while the remaining member countries were represented by lower-ranking officials.—AFP