An emerging Asian financial architecture aims to enhance regional financial stability and market depth.
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| Quick Facts | |
|---|---|
| Report location: | source |
| Language: | English |
| Publisher: | Policy Horizons Canada |
| Publication date: | February 1, 2014 |
| Authors: | Not Specified |
| Time horizon: | 2020 |
| Geographic focus: | Asia, Canada |
| Page count: | 3 |
The research method includes analyzing the development of financial institutions and mechanisms in Asia, assessing policy changes, and examining the potential impact on regional and global financial stability. It also involves reviewing expert opinions and considering future scenarios for international engagement.
(Generated with the help of GPT-4)
Asian countries are developing a new financial architecture to improve regional financial stability and deepen financial markets. This includes the Asian Bond Market Initiative (ABMI) for local currency borrowing, and the ASEAN Capital Markets Forum, which is standardizing laws to facilitate investment within the ASEAN Economic Community. Significant foreign reserves have been amassed to respond to crises, and efforts are underway to build a financial safety net through the Chiang Mai Initiative Multilateralization (CMIM), a system of bilateral currency swaps. While these markets and integration efforts are still developing, policymakers are committed to reducing reliance on Western institutions. The CMIM's resources and monitoring capacities are growing, and it is expected to incorporate more economically important neighbors, providing Asian states with greater influence in international institutions like the IMF. The Asian Financial Crisis highlighted the need for regional cooperation, leading to the ASEAN+3 finance ministers founding the CMI and later the CMIM. The ABMI complements these efforts by aiming to develop a liquid Asian bond market. Canada has begun to engage with Asia financially, indicating potential integration. Two scenarios for Canada's future involvement are considered: remaining on the sidelines or actively engaging with regional institutions. Experts predict the CMIM may evolve into an 'Asian Monetary Fund' by 2020, with further cooperation in the region expected.
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Categories: 2014 publication year | 2020 time horizon | 2020s time horizon | Asia geographic scope | Canada geographic scope | English publication language | asean integration | asia geographic scope | bond markets | canadian engagement | cmim | currency swaps | finance | financial stability | foreign reserves | imf influence | market deepening | regional cooperation