Japan, Southeast Asia in talks to expand currency swap

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Japan and Southeast Asian countries are in talks over expanding currency swap arrangements to help cushion their economies in financial emergencies, an official said Thursday, ahead of a Japan-ASEAN summit next week.

A swap is a device useful in times of economic stress, when normal foreign exchange markets can seize up, in which financial authorities agree to buy local currency with something much more liquid — usually the US dollar.

Tokyo is now talking with five countries — Indonesia, the Philippines, Malaysia, Thailand, and Singapore — to expand or resume bilateral currency swaps, a finance ministry official told AFP.

Since the onset of the Asian currency crisis in the late 1990s, Japan has spearheaded efforts to build a multilateral currency swap agreement, now known as the Chiang Mai Initiative (CMI).

“We are discussing with a view that bilateral arrangements are faster in terms of decision-making than the multi-lateral framework,” the official said.

Japan currently has a US$12 billion bilateral arrangement with Indonesia and a US$6 billion arrangement with the Philippines, but negotiators are aiming to increase the amounts, while Tokyo wants to resume bilateral deals with the three other countries, he said.

The CMI — which groups the 10 Association of Southeast Asian Nations (ASEAN) member countries plus China, Japan, and South Korea — is a currency swap arrangement worth a total of US$240 billion.

Japan is due to host a special summit with ASEAN leaders in Tokyo from December 13-15 to mark the 40th anniversary of exchanges.

A recent survey showed that ASEAN countries had re-emerged as Japan Inc’s favoured investment destinations, with China falling off the top of the list for the first time in more than two decades because of higher labour costs and bilateral tensions.

Japan is keen to bolster its relations with countries in the region as it seeks to counter the growing influence of China.

 

 

 

 

 

Source : Channel News Asia | December 5, 2013

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About thomasdinnocenzi

Thomas D'Innocenzi is a highly accomplished, results-focused senior international executive with extensive experience in global sourcing and market development worldwide to meet evolving business needs. Tom has proven ability in implementing and managing profitable global sourcing operations worldwide. Extensive experience in international market development operations to accommodate rapid growth. Skilled in building top-performing teams, benchmarking performance, and restricting organizations to improve efficiency, productivity, and profitability. Experienced transition leader and change agent. As principal of Nova Advisors, LLC I’ve assembled an exemplary team that brings with them the knowledge and experience gained from starting up a Global Sourcing program with multiple Fortune 500 companies as well as the largest supplier network throughout the Asia-Pacific region. We have experience and expertise in more than a thousand medical and pharmaceutical products in manufacturing and sourcing at the best value. The right product, the right price point and the right branding fueled these successes that resulted in double-digit growth for top line sales and bottom line net margins for our customers. What sets us apart: • Our reach includes a large network of suppliers & manufacturers spanning 13 countries in Asia-Pacific region • We understand the manufacturing process and the business of the supplier and the buyer • Our company culture is based on quality assurance and our process is based on local quality control Our commitment is to be your partner offering the best products and services at the lowest cost. Contact me to discuss how we can make the global marketplace work for you. thomas@novaadvisors.com In addition, I am open to discussing opportunities in global sourcing, international marketing & sales, logistics and medical/pharma in Thailand, Vietnam, Malaysia, Philippines & Japan. Aside from my work I enjoy piano, astronomy, physics, and assisting my daughters with their studies. SPECIALTIES: Global Sourcing, Supply Chain Management, Business Development, Marketing, Logistics, Global Networking, Market Development, Healthcare Solutions, Pharmaceuticals, Medical Devices, Technology, Asia, Southeast Asia, US and Canada
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