Asian bond market plan proceeds

Asian bond market plan proceeds

Agence France-Presse, Manila

Finance ministers of Southeast Asia as well as China, Japan and South Korea will map out procedures for an Asian bond market during talks here this week, Philippine Finance Secretary Jose Isidro Camacho said Monday.

"The difficulty is that it is so wide in scope, we have to hold talks about the listing procedures, settlements and tax regimes," he told reporters ahead of the meeting Wednesday of finance ministers from the Association of Southeast Asian Nations (ASEAN).

Camacho will chair the meeting that will follow talks among the 10 ASEAN ministers and their counterparts from China, Japan and South Korea to "operationalize" the regional bond market.

ASEAN comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

It was decided at earlier meetings that the 13 countries promote cross-border issuance of bonds and investment as part of an 'Asian Bond Market Initiative.'

"There has to be certain agreements and common guidelines on credit investments," Camacho said, adding that the project was viable as the region had among the world's biggest reserves.

Six working groups have met under the regional bond initiative to, among other things, set up new securitized debt instruments and credit guarantee mechanisms, as well as to look into the structures of local and regional rating agencies.

Thai premier Thaksin Shinawatra announced last month the launch of the Asian Bond Fund to be backed by 11 countries in the Asia Pacific.

The bond is the brainchild of Thaksin.

Central banks in Japan, the Philippines and Singapore have announced separately that they will each provide US$100 million to the fund, while Australia's reserve bank will contribute $50 million.