Asian bond fund will boost cooperation, S&P says<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
Standard & Poor's Ratings Services (S&P) said on Monday the
\nnew US$1 billion Asian Bond Fund would increase cooperation among
\nthe region's monetary authorities and develop Asia's capital
\nmarkets.<\/p>\n
\"The creation of the fund is a positive development in
\nregional financial cooperation, and S&P's applauds this as a
\ntangible step in the evolution of a regional bond market,\" said
\nCecile Saavedra, S&P Region Head for Asia-Pacific, in a press
\nstatement.<\/p>\n
The fund will be used initially to buy U.S. dollar-denominated
\nsovereign and quasi-sovereign debt in the secondary market and
\npurchases will be targeted at debt issued by the eight non-
\ndeveloped members of the grouping: China, Hong Kong, Indonesia,
\nMalaysia, the Philippines, Singapore, South Korea, and Thailand.
\nThe other three members are Australia, Japan, and New Zealand.<\/p>\n
Standard & Poor's rates more than US$52 billion in sovereign
\nand sovereign-related U.S. dollar debt issued by these eight Asia
\ncountries.<\/p>\n
The totals for each country vary greatly and carry ratings
\nranging from 'AAA' to 'B-'.<\/p>\n
\"Although the thinking behind the establishment of this fund
\nis commendable\", said Ms. Saavedra, \"the nominal size of the fund
\nindicates that the initial practical impact will be limited\".<\/p>\n
Moreover, she notes, \"as seen from the information above, some
\nof these countries have not been major issuers and there is
\nlimited secondary trading\".<\/p>\n
She further said S&P's would like to see over the longer term
\na greater participation in the bond market by the private sector.
\n\"Only with active participation by private investors and private-
\nsector issuers will there be a vibrant and effective regional
\nbond market\".<\/p>\n
Thai premier Thaksin Shinawatra announced last week the launch
\nof the bonds, to be backed by 11 countries in the Asia-Pacific
\nregion.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/asian-bond-fund-will-boost-cooperation-sp-says-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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