ASEAN+3 Taking Big Step Toward Economic Integration, ADB Official Says

ISTANBUL, TURKEY (5 May 2005) - The measures to strengthen financial cooperation announced by ASEAN+3 yesterday are a significant step forward toward East Asia's economic integration, a senior ADB official said today.

"The strengthening of the Chiang Mai Initiative and the enhancement of the ASEAN surveillance process will boost resilience and economic growth of the region," said Masahiro Kawai, Economic Advisor to ADB President Haruhiko Kuroda.

Mr. Kawai will head ADB's newly created Office of Regional Economic Integration from this October.

The Finance Ministers of the 13 ASEAN+3 countries yesterday expressed appreciation for ADB's continued support as they announced their steps for strengthened financial cooperation in Istanbul.

"We thank the ADB for its continued support for ASEAN+3 initiatives and welcomed the Bank's new focus on regional economic integration," the ministers said in a statement after the meeting, held on the sidelines of ADB's 38th Annual Meeting of the Board of Governors in Istanbul.

The ASEAN+3 ministers agreed to strengthen the Chiang Mai Initiative (CMI), under which there are 16 bilateral swap arrangements totaling about $40 billion, into "a more effective and disciplined framework" by

• Integrating the CMI with an enhanced economic surveillance process for the ASEAN+3 countries
• Adopting a collective activation and decision making process on the current network of bilateral swap arrangements within ASEAN+3, as a first step toward multilateralization.
• Increasing the size of the available swaps by up to 100%, from $1 billion to $2 billion, while noting exact size could be decided by bilateral negotiations.
• " Doubling the size of the swaps that could be withdrawn without them coming under an IMF program from 10% to 20%.

"Joint activation is one way to reduce problems of bilateral swap arrangements," Mr. Kawai said. "The new arrangement is a first step toward multilateralism, under which all countries would pool resources."

After the 1997 Asian financial crisis, ADB has been supporting ASEAN+3 initiatives such as the ASEAN+3 Informal Policy Dialogue Process, the CMI, the Asian Bond Market Initiative, and the ASEAN+3 Research Group.

President Kuroda told the ASEAN+3 ministers meeting yesterday that ADB stands ready to work with them and their governments in whatever way it can in their regional integration efforts.

Contact Person

Graham Dwyer
Tel. No. (+90-212) 241-8000 loc. 2548
E-mail: gdwyer@adb.org