Monetary and Financial Integration in Asia: The Way Ahead

Abstract

Since the 1997 Asian financial crisis, East Asia has taken several initiatives to promote regional monetary and financial cooperation to complement efforts at the global level. Going forward, the key issue is how these initiatives for regional monetary and financial cooperation should be sequenced and at what speed they should proceed.

This two-volume book explores what is feasible and desirable in regional monetary and financial cooperation, and lays out a road map of policy options for putting the concept into action over the next several years. In particular, it addresses the following questions: Is there merit in formalizing and intensifying the process of regional information exchange and policy dialogue? Should the bilateral currency swap arrangements under the Chiang Mai Initiative (CMI) be expanded and multilateralized when the CMI is reviewed in 2004? Should a centralized reserve pooling arrangement at the regional level be established? Should countries in the region aim at exchange rate policy coordination? How best can countries in the region cooperate in the area of financial sector reforms and restructuing? How can it be ensured that all these regional initiatives complement initiatives at the global level?

After extensive analysis of these issues, the book lays out recommendations for feasible and desirable forms of enhanced cooperation and actions for the short, medium, and longer term.