Opportune Time to Consider Regional Cooperation Initiatives, ASEAN+3 Told

JEJU, REPUBLIC OF KOREA (15 May 2004) - The bright economic outlook for Asia's economies presents an opportune time to consider and act upon regional cooperation initiatives to enhance resilience to future shocks, ADB President Tadao Chino told the ASEAN+3 Finance Ministers Meeting in Jeju today.

In a statement to the meeting, being held in parallel with the opening of ADB's 37th Annual Meeting of the Board of Governors, he pointed out that since the 1997 Asian financial crisis, regional cooperation had gone beyond trade and investment to include monetary and financial cooperation.

This new cooperation fell into three broad categories: greater information exchange and policy dialogue, reserve sharing and pooling, and regional bond market development.

"ASEAN+3 is now approaching a critical point with these initiatives," he said. "The key issue is how the next steps under these regional initiatives should be sequenced, and at what speed they should proceed."

But Mr. Chino added that care should be taken that these regional efforts are complementary and not competitive with global and national level initiatives.

"It is important to recognize that, ultimately, national initiatives are central to resilience building, with both regional and global initiatives playing a significant supportive role," he said.

He added that information exchange constitutes an important stepping stone toward regional monetary and financial cooperation and there is a strong case for strengthening this.

"One option is to institutionalize the process by establishing an independent, technical body - a regional policy dialogue unit - and a higher-level decision-making body, a regional surveillance group, over the next two years or so," he said.

He also said there is a case for expanding the size of the bilateral swaps under the Chiang Mai Initiative (CMI) and either multilateralizing the swap activation process or consider earmarking a portion of the foreign exchange reserves for financing short-term liquidity needs of the member countries.

In a joint communiqué today, the ministers - from the 10 Association of Southeast Asian Nation countries (Brunei Darrussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand, Viet Nam) - and the People's Republic of China, Japan, and Republic of Korea agreed to undertake a further review of the CMI to explore ways of enhancing its effectiveness.

They agreed that further discussion by a Research Group on regional cooperation should continue next year.

"We are pleased with the overall progress achieved under the ASEAN+3 framework and reiterated our commitment toward forging closer financial and monetary cooperation in this region," the communique said.

Contact Person:

Graham Dwyer
Tel. No. (82-64) 767-8672
E-mail: gdwyer@adb.org