PHUKET, Feb 22 (Bernama) — Asean financial chiefs and their counterparts from China, Japan and South Korea have agreed to expand the size of the Multilateralised Chiang Mai Initiative (CMIM) from the initially agreed US$80 billion to US$120 billion.
The agreement was reached despite initial fears that some countries, including Singapore, were reluctant to contribute to the fund which is considered Asian’s version of the International Monetary Fund (IMF).
CMI is an initiative under the Asean+3 framework which aims for creation of a network of Bilateral Swap Arrangements (BSAs) among the 10 South-east Asian economies and China, Japan and South Korea.
After the 1997 Asian financial crisis, member countries started this initiative to manage regional short-term liquidity problems and facilitate the work of other international financial arrangements and organizations like IMF.
A draft statement prepared here by officials for final approval by Finance Ministers meeting at the Special Asean+3 Finance Ministers’ Meeting (AFMM), noted that the ministers stressed that further strengthening the CMI was crucial to ensure regional market stability.
It said that a regional surveillance mechanism should be further strengthened into a robust and credible system which would facilitate prompt activation of the CMIM.
In this regard, the grouping also plans to set up an independent regional surveillance unit to promote objective economic monitoring.
After the surveillance mechanism becomes fully effective in its function, the IMF de-linked portion may be increased from 20 percent.
The agreement to expand the CMIM is expected to be signed at the annual AFMM in Bali in May.
Deputy Prime Minister and Finance Minister Datuk Seri Najib Tun Razak is leading Malaysia’s delegation at the meeting co-chaired by Thai Finance Minister Korn Chatikavanij and South Korean Minister of Strategy and Finance, Jeung Hyun Yoon.
Source : Bernama