Economic stability essential<\/p>\n
SANUR, Bali (JP): Finance ministers of the Asia Pacific
\nEconomic Cooperation (APEC) forum reaffirmed yesterday the
\ncrucial importance of macro-economic stability and balance to
\nenhancing longer-term investor commitment and exchange rate
\nstability.<\/p>\n
The ministers said in a joint statement after the close of
\ntheir second annual meeting that reversal of capital inflows
\ncould be minimized if governments demonstrated a commitment to
\nprudent fiscal and monetary policies which, in turn, lead to
\nmacro-economic stability.<\/p>\n
The meeting, which was opened by Vice President Try Sutrisno
\non Saturday evening, discussed four major topics: recent economic
\ndevelopments in the 18 member economies, capital flows, the
\neffects of exchange rate movements and resource mobilization for
\ninfrastructure financing.<\/p>\n
\"We have decided to meet again in Kyoto, Japan, on March 17
\nnext year to continue our discussions on those four topics,\" the
\nchairman of the meeting, Indonesia's Minister of Finance Mar'ie
\nMuhammad, said at a joint news conference.<\/p>\n
Thirteen APEC member countries were represented by their
\nfinance ministers and the five others by their deputy finance
\nministers.<\/p>\n
Mar'ie said the ministers exchanged views and experiences
\nregarding the management of capital flows because \"we fully
\nrealize that the surge in capital inflows could also be
\ndisruptive\".<\/p>\n
Mexico's chief delegate, Under Secretary of Finance Jose
\nJulian Sidaoui, said the ministers' discussions also covered the
\nfinancial crisis his country experienced recently.<\/p>\n
\"The conclusion is that it is not good to rely too much on
\nportfolio, short term capital,\" Sidaoui said.<\/p>\n
The ministers acknowledged that it was often difficult for
\nauthorities to determine in advance whether capital inflows were
\ndriven by short-term speculative motives or by longer-term
\nintentions.<\/p>\n
\"However, policies governing the macro-economic environment
\nplay an important role in encouraging longer-term investor
\ncommitment,\" the four-page statement said.<\/p>\n
Moreover, the ministers added, the maintenance of macro-
\neconomic and financial market stability is a key requirement to
\nachieving free and open trade and investment in the region by
\n2020, the year targeted by APEC economic leaders for complete
\ntrade deregulation at their summit in Bogor, West Java, last
\nNovember.<\/p>\n
The six-year-old APEC forum groups Australia, Brunei, Canada,
\nChile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia,
\nMexico, New Zealand, Papua New Guinea, the Philippines,
\nSingapore, Chinese Taipei, Thailand and the United States.<\/p>\n
The ministers asked the International Monetary Fund to
\nconsider ways of improving current mechanisms to respond
\neffectively to problems of financial market stability.<\/p>\n
They admitted that inadequate information about an economy
\ncould be one reason for rapidly shifting capital flows.<\/p>\n
\"Therefore, we believe that increasing the availability of
\neconomic and financial information about our economies can play
\nan important role in enhancing the confidence of the financial
\nmarkets in the strength of regional fundamentals,\" they added.<\/p>\n
The meeting agreed to develop recommendations regarding
\nvoluntary public disclosure, on a regular basis, of economic and
\nfinancial information.<\/p>\n
The ministers expressed support for international anti-money
\nlaundering efforts in the region and encouraged adherence to the
\ninternational standards.<\/p>\n
Infrastructure<\/p>\n
The ministers underlined the need for coordination of public
\nand private resources in financing infrastructure development in
\nview of the increased role of domestic and external private
\nfinancing in that sector.<\/p>\n
In another effort to strengthen the institutionalization of
\nthe finance ministers forum, the meeting asked the deputy finance
\nministers to set up a working group to advance the ministers'
\nwork in three areas: financial and capital markets, financial
\nmobilization for infrastructure development and the effects of
\nexchange rate movements on trade and investment.<\/p>\n
\"Our deputies will meet in Washington, DC, in coincidence with
\nthe joint meeting of the World Bank and the IMF in October,\"
\nMar'ie said. (vin)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/economic-stability-essential-1447893297",
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