| ASEAN+3 accepts Thailand's proposal to stabilise currencies |
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| Wednesday,August 01,2007 Posted: 12:46 BJT(0446 GMT) |
| From:th Original:News |
ASEAN+3 accepts Thailand's proposal to stabilise currencies
MANILA – Thailand's proposal to set up a mechanism to prevent regional currency volatility won support from the 10-member nations of the Association of Southeast Asian Nations (ASEAN) and their three counterparts in East Asia, the Thai foreign minister said Tuesday.
Speaking to journalists after the meeting of ASEAN foreign ministers with their Chinese, South Korean and Japanese counterparts here, Nitya Pibulsonggram explained the proposal was aimed at extending cooperation beyond the parties to the so-called "Chiang Mai Initiatives" in an attempt to cope with the currency volatility resulting from the influx of capital inflows which shook financial stability in the region.
The Chiang Mai Initiatives were introduced in 2000 in order to prevent a recurrence of the 1997-1998 Asian financial crisis. Under the scheme, the central banks of participating countries can swap foreign exchange reserves to counter speculative moves on their currencies.
Mr. Nitya, however, said the current situation facing the region now is different from what was experienced a decade ago and the new situation warranted regional cooperation to tackle the new threat.
The Thai foreign minister expressed confidence that the new move will help create confidence for both investors and exporters.
Huge capital inflows into Asia plus investor concerns over the sluggish US economy have created the volatility in regional currencies, including the Thai baht, in the past few months.
Details of the plan will be discussed at the meeting of finance ministers and deputy governors of the ASEAN Central Bank to be held in China in November.
This round of talks will outline the extensive collaboration to cope with the currency volatility in the long run. If it is accomplished, it will greatly boost confidence in the business sector and among investors, he said.
ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Burma, the Philippines, Singapore, Thailand and Vietnam.
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