AMRO’s Support Function for CMIM

April, 2016 | CMIM

1. ASEAN+3 Macroeconomic Research Office (AMRO) was firstly established as a company in Singapore in April 2011, following the agreement by ASEAN+3 Finance Ministers to set up an independent regional surveillance unit to conduct economic surveillance and to contribute to effective decision-making of the CMIM. At the same time, it was agreed that they would endeavor to subsequently constitute AMRO as an IO with international legal personality. Along with participation of ASEAN+3 Central Bank Governors in the ASEAN+3 financial cooperation framework from the year of 2012, they accelerated the preparation to institutionalize AMRO as an IO and reached consensus on the proposed “AMRO Agreement” in May 2013.

2. Following this, the AMRO Agreement was successfully signed in Washington, D.C. on 10 October 2014. On 9 February 2016, AMRO was transformed into an international organization with full legal personality. AMRO is mandated to: (a) to monitor, assess and report to members on their macroeconomic status and financial soundness; (b) to identify for members macroeconomic and financial risks and vulnerabilities in the region and assist them, if requested, in the timely formulation of policy recommendations to mitigate such risks; (c) to support members in the implementation of the CMIM, the ASEAN+3’s regional financial arrangement; and (d) to conduct other activities necessary for achieving the purpose of AMRO as may be determined by the Executive Committee, including technical assistance. The transformation of AMRO into an IO in 2016 marks an important milestone in ASEAN+3 members’ joint efforts to upgrade and enhance ASEAN+3 financial cooperation. This also enabled AMRO to conduct macroeconomic and financial market surveillance as an international organization, contributing further to regional financial stability along with the strengthened CMIM.

3. In order to support its members in CMIM implementation, AMRO’s effort has centered on providing support to members in making sure that the CMIM is operationally ready. Now, the CMIM is equipped with the Operational Guidelines (OG) specifying relevant activation procedures. Test runs have been regularly conducted by members under various scenarios since 2013. The peacetime checklist was drawn up and run through regularly in order to monitor the member authorities’ preparation for CMIM activation according to the CMIM Agreement and OG. Besides, AMRO has supported the members in laying the groundwork for the ongoing development of CMIM arrangements, providing advice and recommendations to members for their review on the portion of the IMF de-linked portion and drawing up a plan for the CMIM period review of key terms and conditions of the CMIM.