ASTANA ― Top financial officials from East Asia agreed last week to further strengthen a multilateral currency swap scheme in an effort to boost the region’s “financial safety net.”

Finance ministers and central bank governors from the 10-member Association of Southeast Asian Nations as well as South Korea, Japan and China will continue to develop and expand the so-called Chiang Mai Initiative Multilateralization.

“We reaffirm our commitment to further strengthen the CMIM as part of the regional financial safety net,” officials said in a statement after the Asian Development Bank’s annual meeting in Astana, Kazakhstan

The CMIM, whose reserves to buffer Asia against future short-term liquidity fallouts currently stand at $240 billion, was devised in the aftermath of the Asian financial crisis in the late 1990s.

Asia’s recommitment to developing a resilient regional financial market came amid growing concerns over the U.S. Federal Reserve’s bond-buying tapering, geopolitical risks related to Ukraine and China’s slow growth.

They said in the communique that Asia needed to remain “vigilant” against potential global risks and vulnerabilities.

The leaders, however, pointed out that the global economy recovered in the first quarter of this year, driven by steady growth in advanced economies.

The officials agreed to further strengthen the ASEAN Plus Three Macroeconomic Research Office, or AMRO, which it set up in 2011 to provide economic and financial surveillance, and help countries manage the CMIM.

They will endorse a set of guidelines for further cooperation with the International Monetary Fund to “help enhance CMIM’s effectiveness and AMRO’s capacity,” according to the statement.

Meanwhile, financial leaders of Korea, Japan and China failed to hold a trilateral meeting for the second consecutive year, due in part to the absence of Korea’s Deputy Prime Minister and Finance Minister Hyun Oh-seok.

“We understand that because of the ferry disaster an emergency response has to be made,” Taro Aso, Japan’s finance minister and deputy prime minister, who cochaired the ASEAN Plus Three meeting, said at a news conference.

He said he was always open to having a separate meeting with his Korean and Chinese counterparts.

“The economy is a living animal. If something urgent happens (in the region), I’m willing to meet the Korean finance minister or Chinese minister,” he added.

By Oh Kyu-wook, Korea Herald correspondent
(596story@heraldcorp.com)