ABOUT AMRO

The information below is extracted from the Joint Statement of the 21th ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting (May 4, 2018, Manila, Philippines). To read the full statement, click here.

We [the Finance Ministers and Central Bank Governors of ASEAN, China, Japan and Korea (ASEAN+3)], reaffirm our commitment to strengthen the CMIM and have reached a general agreement on the main contents of the first CMIM Periodic Review. This Review will be a key milestone in further strengthening the CMIM, which stands at the center of the regional financial safety net of the ASEAN+3. In this regard, we have agreed to reinforce the financial support including the flexibility to extend periods under the IMF-linked portion of the CMIM Agreement in order to ensure that the CMIM remains up-to-date, and reflective of the member countries’ circumstances, as well as global economic and financial conditions. We have also agreed to add an overarching legal basis for conditionality in order for the CMIM to support members in addressing their risks and vulnerabilities through policy recommendations as well as financial support (please see Annex below). We urge the Deputies to prepare the final text of the amended CMIM Agreement within this year for signing so that it can be executed at the earliest opportunity.

We acknowledge that in an increasingly integrated global financial system, stronger cooperation among the different layers of the GFSN (Global Financial Safety Net) is crucial to prevent and contain future crises and safeguard global financial stability. We welcome the successful completion of the 8th test run carried out with the participation of the IMF, subsequent to the previous year, in which information-sharing process relating to the activation of the CMIM arrangement with the IMF program was examined. It highlighted the importance of better cooperation with the IMF, while respecting the independence and governance of the CMIM and the IMF. Based on the outcome of the test run, we encourage close engagement at an early stage between the CMIM and the IMF, with the support of AMRO, to enhance effectiveness of the regional financial safety net. We appreciate the support of the IMF in the recent test run. We believe that strengthening communication with all relevant parties, including the media, will enhance public confidence if and when the CMIM Arrangement is activated. In addition, we request the Deputies to continue to discuss and review the future direction of the CMIM in the medium-to long-term perspective and report the progress at the next meeting.

We further welcome the continued work of our Deputies to further enhance the operational readiness of the CMIM including updating the CMIM Operational Guidelines (OG) and conducting further test runs jointly with the IMF. We acknowledge the progress made in improving the qualification criteria for the CMIM Precautionary Line, by enhancing the Economic Review and Policy Dialogue (ERPD) Matrix framework, which will be integrated into AMRO’s surveillance work. We encourage the Deputies, in cooperation with AMRO, to conduct a new round of pilot projects and look forward to the 9th CMIM test run in 2018 jointly with the IMF. We welcome the advancements made in developing the CMIM Conditionality Framework, and look forward to further progress in the development of the Guiding Principles and the Operational Guidelines for the CMIM Conditionality Framework. We look forward to further enhancements on the assessment methodology on the potential increase of the IMF De-linked Portion.

[Annex]

Key Points for the First CMIM Periodic Review in 2018

1. Flexibility on the Supporting Periods of CMIM IMF-Linked Portion

The CMIM Parties have agreed to improve the CMIM financing terms in order to strengthen their support for members. Specifically, the length of the CMIM supporting periods has been made flexible by increasing the maximum number of renewals from two times to multiple times if and when necessary in the case of the IMF Linked Portion. As a result of this amendment, CMIM Arrangements can be provided for more than three years in the case of the IMF Linked Portion. This may also provide a modality for financing assurances for co-financing operations.

2. Strengthened Coordination Mechanism with the IMF

It is acknowledged that close cooperation and coordination with the IMF is critical to prevent and/or resolve future crises in the region. In this regard, in order to ensure consistency with the IMF, a coordination process in the form of Operational Guidelines (OG) will be duly established to have a shared view on economic and financial situations, financing needs, and policy recommendations for co-financing. The modalities of early information-sharing will be aligned with this coordination process. Engagement at an early stage may facilitate smooth collaboration, help address differences and allow the formation of a common view on key parameters and policies, while the CMIM and the IMF will continue to form an independent view on their respective financing decisions.

3. Enhanced Conditionality Framework

The CMIM Parties have agreed to add an overarching legal basis for conditionality, in addition to the existing one for crisis prevention, as an applicable provision for the CMIM Arrangement for crisis resolution. It is expected that the CMIM may further support members by helping in the design and implementation of appropriate economic and financial policies, which in turn can make members overcome a crisis more quickly and settle on a sustainable path of economic growth. In joint financing programs with the IMF, it is now explicit that conditionality of the approved CMIM Arrangement shall be consistent with the IMF-supported Program, through early information-sharing and engagement and collaboration based on one coherent program.

4. Reinforced Review and Ex-post Monitoring

The program review process is reinforced by identifying the issues to be reviewed and monitored after a CMIM Arrangement is approved. For co-financing, program reviews and disbursements based on such a review by the CMIM and the IMF can be better coordinated with the IMF-supported Program.

5. Upgrading Financing Terms and Conditions

A series of financing conditions have been upgraded consistent with the relevant IMF-supported Program. For example, it has been agreed in the case of the IMF Linked Portion, flexibility will be applied to the schedule of disbursement, subject to the decision made by the ELDMB (Executive Level Decision Making Body).

6. Fine-tuning the Duty to Confidentiality Clause

If necessary and available, some CMIM-related information can be disclosed for media coverage to bolster market confidence when the CMIM is activated and also be shared with third parties, including the IMF, subject to the decision made by the ELDMB and the consent of the Arrangement Requesting Party.

The information below is extracted from the Joint Statement of the 20th ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting (May 5, 2017, Yokohama, Japan). To read the full statement, click here.

We [the Finance Ministers and Central Bank Governors of ASEAN, China, Japan and Korea (ASEAN+3)] affirmed our commitment to further strengthen the CMIM as an essential part of the regional financial safety net. In this regard, we welcomed the revision of the CMIM Operational Guidelines to clarify the activation process of the IMF De-linked Portion of the CMIM, as well as the progress in the preparation of the CMIM Conditionality Framework. We also welcomed the Deputies’ endorsement of the assessment methodology on the increase in the IMF De-linked Portion. We appreciated all these efforts and the significant progress that has been made in working towards the potential increase of the IMF De-linked Portion. We look forward to further progress on this issue. It is encouraging to note that the CMIM, with its current size of USD 240 billion, is at the center of our regional financial safety net, complemented by the network of bilateral swap arrangements in the region amounting to more than USD 160 billion.

We welcomed the development of the qualification indicators for the CMIM-Precautionary Line, based on the Economic Review and Policy Dialogue (ERPD) Matrix, that consists of key economic and financial indicators of all ASEAN+3 member economies. We look forward to the successful completion of the pilot project for the ERPD Matrix peacetime procedure and progress on ERPD Matrix indicators and benchmarks, in cooperation with AMRO.

We noted that the CMIM also contributes to a stronger global financial safety net with the IMF at its center. In this regard, we welcomed the successful completion of the 7th Test Run which examined the activation of the CMIM arrangement with the IMF program. It has highlighted the importance of improving CMIM’s readiness and effectiveness by (i) addressing issues that are fundamental to the CMIM, (ii) improving CMIM-IMF coordination (including burden sharing, financing conditions and information sharing), and (iii) enhancing AMRO’s capacity. These important works have been included in our plan on the Periodic Review of the CMIM Agreement, and we look forward to strong progress towards this direction by our next meeting, including the reports from the two Working Groups (WGs), one on CMIM fundamental issues and the other on the coordination with IMF. We will deepen our engagement with the IMF with the aim of resolving operational issues that may arise in order to further strengthen the supplementary role of the CMIM in the global financial safety net.

The information below is extracted from the Joint Statement of the 19th ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting (May 3, 2016 Frankfurt, Germany). To read the full statement, click here.

We [the Finance Ministers and Central Bank Governors of ASEAN, China, Japan and Korea (ASEAN+3)] affirmed our commitment to further strengthen the CMIM as an essential part of the regional financial safety net. In this regard, we welcomed the progress made on enhancing the CMIM Operational Guidelines (OG), conducting regular CMIM Test Runs under various scenarios, and undertaking the CMIM peace-time preparation activities to ensure the operational readiness of the CMIM, including the activation process of IMF delinked portion, with AMRO’s support. We look forward to the recommendation of the taskforce in November 2016 on the potential increase in the IMF delinked portion.

Against the backdrop of the reform of the international financial architecture now being pushed forward by the G20, including further strengthening the global financial safety net with the IMF at its center, we tasked the Deputies to carefully study how the CMIM can be better integrated into the global financial safety net. To this end, we welcomed a Test Run to be conducted this year on the crisis resolution facility linked to the IMF program.

We welcomed the continued work of our Deputies and AMRO to further develop the qualification indicators for the CMIM Precautionary Line (CMIM-PL), based on the Economic Review and Policy Dialogue (ERPD) Matrix, which consists of key economic and financial indicators of all ASEAN+3 members. We tasked the Deputies, in cooperation with AMRO, to continue to develop the ERPD Matrix and to explore ways to further utilize this tool in a more forward-looking manner.

We supported the timely conclusion of the periodic review of the CMIM Agreement. In view of this, we recognized that some aspects in the CMIM fundamental issues should be further clarified in the CMIM Agreement based on the lessons learnt from the previous peace-time preparation and Test Runs. We welcomed the Deputies’ endorsement of the priority order and work schedule for the CMIM fundamental issues, and tasked the Deputies to work out solutions on the relevant issues following the agreed timetable.

We noted the completion of the CMIM Studies on “Troika’s Financial Assistance Programs in the Euro Area for CMIM’s Future Reference” and “Comparative Analysis of CMIM Arrangement and Market Practices”.

The information below is extracted from the Joint Statement of the 18th ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting (May 3, 2015, Baku, Azerbaijan). To read the full statement, click here.

We [the Finance Ministers and Central Bank Governors of ASEAN, China, Japan and Korea (ASEAN+3)] remain committed to ensuring that the CMIM is operationally ready, as well as to further strengthening the mechanism as an essential part of the regional financial safety net. In this regard, we welcomed the amended CMIM Agreement, which entered into force on 17 July 2014. We also welcomed the Deputies’ achievements in enhancing the CMIM Operational Guidelines (OG), conducting CMIM Test Runs under various scenarios, and undertaking the CMIM peace-time preparation exercise. We reaffirmed our commitment to ensuring the operational readiness of the CMIM, and thus tasked the Deputies, in cooperation with AMRO, to continue working on these exercises, and to reflect the lessons learnt in the OG.

With the introduction of the CMIM crisis prevention facility (“CMIM Precautionary Line” or “CMIM-PL”) in July 2014, it is crucial to develop and operationalize the qualification assessment framework for member economies to access the CMIM-PL. In this regard, we welcomed the continuing work of our Deputies and AMRO to further develop the qualification indicators for the CMIM-PL, based on the Economic Review and Policy Dialogue (ERPD) Matrix, which consists of key economic and financial indicators of all ASEAN+3 members. We assigned the Deputies, in cooperation with AMRO, to continue to develop the ERPD Matrix and to explore ways to further utilize this tool in a more forward-looking manner.

We took note of the progress in the work on the potential increase in the IMF De-linked portion and tasked the Deputies to further advance the work on strengthening the CMIM as a part of the regional financial safety net.

We welcomed the commencement of the CMIM Studies on “Troika’s Financial Assistance Programs in the Euro Area for CMIM’s Future Reference” and “Comparative analysis of CMIM arrangement and market practices under International Swaps and Derivatives Association (ISDA)” while taking into account the conditions within each region.

The information below is extracted from the Joint Statement of the 17th ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting (May 3, 2014, Astana, Kazakhstan). To read the full statement, click here.

We [the Finance Ministers and Central Bank Governors of ASEAN, China, Japan and Korea (ASEAN+3)] reaffirm our commitment to further strengthen the CMIM as part of the regional financial safety net. We welcomed the report of our Deputies on the progress made to prepare during peace times to ensure that the CMIM is operationally ready. In particular, we welcomed the Deputies’ achievements in completing the revision of the Operational Guidelines of the amended CMIM Agreement which contain the detailed arrangements for the operationalization of the CMIM. We instructed the Deputies, in cooperation with AMRO, to continue developing the CMIM operational readiness.

We welcomed the work of our Deputies to develop the first full set of indicators of the “Economic Review and Policy Dialogue (ERPD) Matrix” which consists of various economic and financial indicators of all ASEAN+3 members. The ERPD Matrix is intended to be used to assess members’ qualification for the CMIM’s crisis prevention facility. We instructed the Deputies, in cooperation with AMRO, to continue developing the matrix and to elaborate the ways the matrix will be used to assess a member’s qualification for the CMIM crisis prevention facility.

We also agreed to endorse the “Guidelines for the further cooperation with the International Monetary Fund” to help enhance CMIM’s effectiveness and AMRO’s capacity. We took note of the progress in the study on “Ways to Improve the Use of Local Currencies under the CMIM” and “Joint Response to the Capital Flows at the ASEAN+3 Level”.

The information below is extracted from the Joint Statement of the 16th ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting (May 3, 2013, Delhi, India). To read the full statement, click here.

We [ the Finance Ministers and Central Bank Governors of ASEAN, China, Japan and Korea (ASEAN+3)] appreciated the work done by our Deputies to amend the CMIM Agreement to reflect the measures to strengthen the CMIM as agreed in May 2012. In this connection, the Finance Ministers welcomed the Central Bank Governors’ involvement in the fundamental decision making process of the CMIM. At the same time, we remain committed to ensuring that the CMIM is operationally ready, and we instructed the Deputies to continue work on the necessary revisions of the current CMIM Operational Guidelines by the next ASEAN+3 Finance Ministers and Central Bank Governors’ Meeting in 2014.

We welcomed the work of our Deputies and AMRO to develop the “Economic Review and Policy Dialogue (ERPD) Matrix”. The matrix will consist of economic indicators of all ASEAN+3 members and will facilitate the assessment of members’ qualification for the CMIM’s crisis prevention facility. We instructed the Deputies and AMRO to continue work on the ERPD Matrix for the smooth implementation of the CMIM should the need arise.

We reaffirmed our commitment to further strengthening the CMIM as part of the regional financial safety net. Recognizing that enhancing the use of local currencies for settlement in trade, investment and capital transactions, and reducing the volatility of capital flows in and out of the region would help mitigate the impacts of external risks, we endorsed further studies on “Ways to Improve the Use of Local Currencies under the CMIM” and “Joint Response to the Capital Flows at the ASEAN+3 Level”. We instructed the Deputies to consider ways to seek an effective cooperative relationship with the International Monetary Fund (IMF) and other multilateral financial institutions in the areas of surveillance, liquidity support arrangement and capacity development.

The information below is extracted from the Joint Statement of the 15th ASEAN+3 Finance Ministers’ Meeting (May 3, 2012, Manila, Philippines). To read the full statement, click here.

Against this backdrop, we [the Finance Ministers and Central Bank Governors of ASEAN, China, Japan and Korea (ASEAN+3)] all committed to strengthening the CMIM as a part of the regional financial safety net, and unanimously agreed as follows:

1. i) to double the total size of the CMIM from US$120bn to US$240bn;
2. ii) to increase the IMF de-linked portion to 30% in 2012 with a view to increasing it to 40% in 2014 subject to review should conditions warrant;

iii) to lengthen the maturity and supporting period for the IMF linked portion from 90 days to 1 year and from 2 years to 3 years, respectively; and those for the IMF de-linked portion from 90 days to 6 months and from 1 year to 2 years, respectively; and

1. iv) to introduce a crisis prevention facility called “CMIM Precautionary Line (CMIM-PL).”

More details can be found in Annex 1.

We shall continue to engage the IMF in the areas of surveillance, financial safety net and capability development.

We requested the Deputies to work out necessary revisions of the current CMIM Agreement and the Operational Guidelines by the upcoming November Deputies’ Meeting to reflect these agreements.

The information below is extracted from the Joint Statement of the 14th ASEAN+3 Finance Ministers’ Meeting (May 4, 2011, Ha Noi, Viet Nam). To read the full statement, click here.

We [the Finance Ministers of ASEAN, China, Japan and Korea (ASEAN+3)] endorsed the “Operational Guidelines for Enhancing Effectiveness of CMIM”, which is the operational manual for the currency swaps made pursuant to the CMIM Agreement, including the CMIM’s activation process in relation to the existence of the IMF Programs. We believe that these Guidelines will contribute to swift and smooth activation of CMIM Agreement.

We welcomed the establishment of AMRO, which, as the surveillance unit of CMIM, plays an important role to monitor and analyze regional economies, and to contribute to early detection of risks, swift implementation of remedial actions, and effective decision-making of CMIM. We expect AMRO to be fully operational soon, and are committed to promote the smooth and efficient operation of AMRO. We instructed the Deputies to review AMRO’s organizational capacity at the next Deputies’ meeting so that AMRO could fully meet its objectives. We also instructed the Deputies to launch a study to strengthen the legal status of AMRO to constitute an international organization with an international legal personality.

We shared the view that, under the current global financial environment, crisis takes place on a global scale and it spreads in a short period of time. It has demonstrated the importance of crisis prevention measures to deter contagion. Considering that the regional financial arrangement needs to be adapted to this new environment, we instructed the Deputies to initiate a study on the design of a possible crisis prevention function for CMIM, including the size, further collaboration with the IMF, and the role of AMRO.

The information below is extracted from the Joint Statement of the 14th ASEAN+3 Finance Ministers’ Meeting (May 4, 2011, Ha Noi, Viet Nam). To read the full statement, click here.

We [the Finance Ministers of ASEAN, China, Japan and Korea (ASEAN+3)] endorsed the “Operational Guidelines for Enhancing Effectiveness of CMIM”, which is the operational manual for the currency swaps made pursuant to the CMIM Agreement, including the CMIM’s activation process in relation to the existence of the IMF Programs. We believe that these Guidelines will contribute to swift and smooth activation of CMIM Agreement.

We welcomed the establishment of AMRO, which, as the surveillance unit of CMIM, plays an important role to monitor and analyze regional economies, and to contribute to early detection of risks, swift implementation of remedial actions, and effective decision-making of CMIM. We expect AMRO to be fully operational soon, and are committed to promote the smooth and efficient operation of AMRO. We instructed the Deputies to review AMRO’s organizational capacity at the next Deputies’ meeting so that AMRO could fully meet its objectives. We also instructed the Deputies to launch a study to strengthen the legal status of AMRO to constitute an international organization with an international legal personality.

We shared the view that, under the current global financial environment, crisis takes place on a global scale and it spreads in a short period of time. It has demonstrated the importance of crisis prevention measures to deter contagion. Considering that the regional financial arrangement needs to be adapted to this new environment, we instructed the Deputies to initiate a study on the design of a possible crisis prevention function for CMIM, including the size, further collaboration with the IMF, and the role of AMRO.

The information below is extracted from the Joint Statement of the 12th ASEAN+3 Finance Ministers’ Meeting (May 3, 2009, Bali, Indonesia). To read the full statement, click here.

On the Chiang Mai Initiative (CMI), we [the Finance Ministers of ASEAN, China, Japan and Korea (ASEAN+3)] have reached agreement on all the main components of the CMIM, including the individual country’s contribution, borrowing accessibility, and the surveillance mechanism. The agreed components of the CMIM, which is a framework of mutual assistance among ASEAN+3 countries, are consistent with its two core objectives : (i) to address short-term liquidity difficulties in the region and (ii) to supplement the existing international financial arrangements.

We agreed to implement the CMIM before the end of this year. In this regard, we tasked our Deputies to work out the operation details and implementation plan, particularly the legal documents that will govern the CMIM.

The information below is extracted from the Joint Media Statement, Action Plan to Restore Economic and Financial Stability of the Asian Region. To read the full statement, click here.

In order to ensure regional market stability and to foster confidence in the markets, we stress the importance of operationalising the Multilateralisation of the Chiang Mai Initiative (CMI), and agree on the following key elements.

• The total size of Multilateralised Chiang Mai Initiative (CMIM) will be increased from the initially agreed level of US$ 80 billion to US$ 120 billion, the proportion of the amount of contribution between ASEAN and the Plus Three countries will be maintained at 20:80 respectively.
• The regional surveillance mechanism should be further strengthened into a robust and credible system which will facilitate prompt activation of the CMIM. An independent regional surveillance unit will be established to promote objective economic monitoring.
• After the above surveillance mechanism becomes fully effective in its function, the IMF de-linked portion may be increased above the current limit of 20 percent.

Building on the basis of the progress made thus far, with a view to making our financial cooperation more responsive and effective, we strive to reach agreement on the main components of CMIM by our next meeting in 2009, in Bali, Indonesia.

As an interim measure, the existing bilateral swap arrangement network should play its full role and be strengthened in terms of size and participants as necessary.

The information below is extracted from the Joint Statement of the 11th ASEAN+3 Finance Ministers’ Meeting (May 4, 2008, Madrid, Spain). To read the full statement, click here.

On the Chiang Mai Initiative (CMI), we have been carrying out work on the key elements of the multilateralisation of the CMI since our last Meeting in Kyoto, following the principle agreement that a self-managed reserved pooling arrangement governed by a single contractual agreement is an appropriate form of multilateralisation. We reiterated our commitment to maintain the two core objectives of the CMI: (i) to address short-term liquidity difficulties in the region and (ii) to supplement the existing international financial arrangements. We agreed that CMI Multilateralisation will be underpinned by rigorous principles to govern its key aspects, including economic surveillance, borrowing accessibility, activation mechanism, decision making rules and lending covenants, while keeping to timely disbursement.

The information below is extracted from the Joint Statement of the 10th ASEAN+3 Finance Ministers’ (May 5, 2007, Kyoto, Japan). To read the full statement, click here.

On the Chiang Mai Initiative, we [the Finance Ministers of ASEAN, China, Japan and Korea (ASEAN+3)] were pleased to note that the Bilateral Swap Arrangement (BSA) network has increased to US$ 80 billion, consisting of 16 BSAs among 8 countries.

We noted the substantial progress made in the activities of the new Taskforce on CMI Multilateralisation. Proceeding with a step-by-step approach, we unanimously agreed in principle that a self-managed reserve pooling arrangement governed by a single contractual agreement is an appropriate form of multilateralisation. We recognised the consensus reached as a significant achievement towards an advanced framework of regional liquidity support mechanism. We instructed the Deputies to carry out further in-depth studies on the key elements of the multilateralisation of the CMI including surveillance, reserve eligibility, size of commitment, borrowing quota and activation mechanism. Meanwhile, we reiterated our commitment to maintain the two core objectives of the CMI, i.e.,

1. i) to address short-term liquidity difficulties in the region and
2. ii) to supplement the existing international financial arrangements.

We reaffirmed the importance and necessity of strengthening cooperation on regional surveillance alongside the CMI multilateralisation process based on the Economic Review and Policy Dialogue (ERPD). We welcomed the initial progress made by the Group of Experts (GOE) and the Technical Working Group on Economic and Financial Monitoring (ETWG) on ways to strengthen regional surveillance capacity since their launches after our last meeting in Hyderabad. Further, we agreed to explore ways on how to link these activities with strengthened surveillance within the region.

The information below is extracted from the Joint Statement of the 9th ASEAN+3 Finance Ministers’ Meeting (May 4, 2006, Hyderabad, India). To read the full statement, click here.

On the Chiang Mai Initiative (CMI), substantial progress has continued to be made. In particular, the strengthening of the regional liquidity support network (also known as “the Second Phase of the CMI Review”), which was initiated at the Jeju ASEAN+3 Finance Ministers’ Meeting 2004, had been successfully completed, as explained below. Here, we [the Finance Ministers of the ASEAN, China, Japan, and Korea (ASEAN+3)] reaffirmed to firmly maintain the CMI’s two core objectives, namely, (1) to address short-term liquidity difficulties in the region and (2) to supplement the existing international financial arrangements.

1. i) Collective decision-making procedure for the swap activation was adopted. All Swap Providing Countries can simultaneously and promptly provide liquidity support to any parties involved in bilateral swap arrangements (BSA) at times of emergency;
2. ii) To explore the ways for further strengthening surveillance capacity in East Asia, the Group of Experts (GOE) and the Technical Working Group on Economic and Financial Monitoring (ETWG) would be launched. The GOE, composed of several regional professional experts, would serve as an independent economic assessment vehicle for this region. The ETWG would play an important role in developing and spreading the Early Warning System to facilitate early detection of irregularities.

iii) The total swap size has now reached US$75.0 billion, almost doubled from a year ago. Nine BSAs have been revised since last year to enhance the effectiveness of CMI reflecting the Istanbul Agreement.

Looking ahead, we tasked the Deputies to set up a “new task force” to further study various possible options towards an advanced framework of the regional liquidity support arrangement (CMI multilateralization or Post-CMI), based upon their exploration during the past year. Moreover, we instructed the Deputies to enhance the regional surveillance capacities.

The information below is extracted from the Joint Statement of the 8th ASEAN+3 Finance Ministers’ Meeting (May 4, 2005, Istanbul, Turkey). To read the full statement, click here.

On the Chiang Mai Initiative (CMI), we [the Finance Ministers of ASEAN, China, Japan and the Republic of Korea (ASEAN+3)] reaffirmed our resolution to strengthen our self-help and support mechanism in East Asia by making the CMI a more effective and disciplined framework. As a basic principle for the review, we agreed to firmly maintain the CMI’s two core objectives, namely, (1) to address short-term liquidity difficulties in the region and (2) to supplement the existing international financial arrangements.

Taking into account (i) the improvement in our economic and financial situations and (ii) the advancement in our various initiatives for regional financial cooperation, such as regional surveillance and the Asian Bond Markets Initiative, as well as reflecting the existing vulnerabilities in the global financial markets, we agreed upon the following measures to enhance the effectiveness of the CMI as a self-help and support mechanism:

1. I) Integration and enhancement of ASEAN+3 economic surveillanceinto the CMI framework to enable early detection of irregularities and swift remedial policy actions, with a view to developing effective regional surveillance capabilities that complements the current undertaking by the International Financial Institutions (IFIs);
2. II) Clear-defining of the swap activation process and the adoption of a collective decision-making mechanismof the current network of bilateral swap arrangements (BSA) as a first step of multilateralization so that the relevant BSAs would be activated collectively and promptly in case of emergency; and

III) Significant increase in the size of swaps. The size of the BSAs should be increased by (i) increasing the amount of existing bilateral commitment, (ii) concluding new BSAs, for example, among ASEAN countries, and (iii) transforming one-way BSAs to two-way BSAs. Member countries favored an enhancement of up to 100% increase of the existing individual arrangements while noting that the size could be flexibly decided by bilateral negotiations. In this context, the ASEAN Swap Arrangement has been doubled from US$ 1 Billion to US$ 2 billion.

1. IV) Improving the drawdown mechanism. The size of swaps that could be withdrawn without the IMF-supported program would be increased from the current 10% to 20% in order to better cope with sudden market irregularities while the current framework to complement the international financial arrangements and other disciplined conditions would be firmly maintained.

To further enhance the CMI’s effectiveness, we tasked the Deputies to study the various possible routes towards multilateralizing the CMI.

The information below is extracted from the Joint Statement of the 7th ASEAN+3 Finance Ministers’ Meeting (May 15, 2004, Jeju, Korea). To read the full statement, click here.

On the Chiang Mai Initiative (CMI), we [the Finance Ministers of ASEAN, China, Japan and the Republic of Korea (ASEAN + 3)] are pleased to note the continued expansion of its network of bilateral swap arrangements. Since we last met in Makati City in the Philippines, in August 2003, four more Bilateral Swap Agreements (BSAs) have been concluded. That brings the total number of (BSAs) to sixteen, and the size of the network to USD 36.5 billion.

We agreed to undertake further review of the CMI to explore ways of enhancing its effectiveness. A working group will be tasked to conduct the review and report the outcome, by the end of 2004, to our Deputies who will report to us at the next AFMM+3.

The information below is extracted from the Joint Statement of the 6th ASEAN+3 Finance Ministers’ Meeting (August 7, 2003, Makati, Philippines). To read the full statement, click here.

We [the Finance Ministers of ASEAN, China, Japan and the Republic of Korea (ASEAN + 3)] discussed recent economic and financial developments and policies. We also reviewed the progress of regional financial cooperation initiatives, including, the Chiang Mai Initiative (CMI), Monitoring of Capital Flows, the Early Warning System (EWS) and the Asian Bond Market Initiative (ABMI).

On regional financing arrangements, we are pleased to note significant progress since we last met in Shanghai in May 2002. The number of Bilateral Swap Arrangements (BSAs) has doubled from six to twelve, and the size of the network has increased from USD 17 billion to USD 31.5 billion. Four more BSAs (China Indonesia, China-Philippines, Korea-Indonesia and Japan-Singapore)are expected to be concluded before the end of this year.

To strengthen the current peer review process, we agreed to implement the recommendations made by the ASEAN+3 Study Group to Examine Ways of Enhancing the Effectiveness of Economic Reviews and Policy Dialogues.

We also agreed to set up the ASEAN+3 Finance Cooperation Fund (the Fund) to support our on-going economic review and policy dialogue. The Fund would complement our efforts to enhance the effectiveness of our economic surveillance in support of the CMI and the ABMI. The Fund would be administered by the ASEAN Secretariat.

The information below is extracted from the Joint Statement of the 5th ASEAN+3 Finance Ministers’ Meeting (May 10, 2002, Shanghai, China). To read the full statement, click here.

On regional financing arrangement, we are pleased that significant progress has been made in the implementation of the Chiang Mai Initiative. To date, six bilateral swap arrangements (BSAs) between Japan-Korea, Japan-Thailand, Japan-the Philippines, Japan-Malaysia, China-Thailand, and China-Japan with a combined size of USD 17 billion, have been concluded and signed. Negotiations on two BSAs between China-Korea and Korea-Thailand are already at an advanced stage while substantial agreements on the two BSAs between Korea-Malaysia and Korea-the Philippines have been reached. Another four BSAs between Indonesia-Japan, Japan-Singapore, China-Malaysia and China-the Philippines have been initiated. In addition, in line with the Chiang Mai Initiative, the existing swap arrangements between Japan-Korea and Japan-Malaysia have been renewed with the combined size of USD 7.5 billion.

The information below is extracted from the Joint Statement of the 4th ASEAN+3 Finance Ministers’ Meeting (May 9, 2001, Honolulu, USA). To read the full statement, click here.

We are pleased to note the significant progress that has been made in implementing the CMI to further strengthen our self-help and support mechanisms in East Asia. The ASEAN Swap Arrangement, one of the CMI main components, has been enlarged to USD 1 billion effective 17 November 2000 and has as its participants all ASEAN member countries. Regarding the network of bilateral swap arrangements (BSA) and repurchase agreements under the CMI, substantial agreements on the BSA have been reached between Korea-Japan, Malaysia-Japan, and Thailand-Japan. Our senior officials will continue to work towards establishing a network of bilateral swap and repurchase agreement facilities among ASEAN countries, China, Japan and Korea. We agreed that we would review the current main principles of the bilateral swap arrangement under the CMI in three years, taking account of the actual operation of the BSA and other relevant factors. Recognizing the importance of enhanced monitoring of the economic situation in our region in implementing the BSA, we agreed to establish a study group to examine ways of enhancing the effectiveness of our economic reviews and policy dialogues.

The information below is extracted from the Joint Statement of the 3rd ASEAN+3 Finance Ministers’ Meeting (May 6, 2000, Chiang Mai, Thailand). To read the full statement, click here.

In order to strengthen our self-help and support mechanisms in East Asia through the ASEAN + 3 framework, we recognized a need to establish a regional financing arrangement to supplement the existing international facilities. As a start, we agreed to strengthen the existing cooperative frameworks among our monetary authorities through the “Chiang Mai Initiative”. The Initiative involves an expanded ASEAN Swap Arrangement that would include ASEAN countries, and a network of bilateral swap and repurchase agreement facilities among ASEAN countries, China, Japan and the Republic of Korea.