Malaysia, Japan Agree To Push For An Asian Bond Market
Malaysia, Japan Agree To Push For An Asian Bond Market
Associated Press Kuala Lumpur
Prime Minister Mahathir Mohamad and Japan's finance minister agreed Saturday to push for an Asian bond market to stabilize regional currencies.
Japan's Finance Minister, Masajuro Shiokawa, who was on a one- day visit to Kuala Lumpur, said he agreed during a meeting with Mahathir on the importance of a regional bond market.
"We talked about creating an Asian bond market, we are trying to push the idea forward," Shiokawa told reporters after winding up his visit.
A Japanese official, speaking on condition of anonymity, said Shiokawa had suggested that the bond market should consist of bonds denominated in an Asian currency but did not say which currency should be used.
The idea was proposed by Thailand last year. Thai Prime Minister Thaksin Shinawatra said that an Asian bond market would help the region - battered by an economic crisis in 1997-to lessen dependence on the world's largest countries and prevent another meltdown.
On Saturday, Shiokawa and Mahathir, who is also Malaysia's finance minister, agreed that the details for proposal should be worked out by a grouping of Southeast Asian countries and Northeast Asian powerhouses - Japan, South Korea and China.
The official said finance officials from the grouping, known as Association of Southeast Asian Nations (ASEAN) plus three, would discuss the proposal at a meeting in Manila in April. ASEAN comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
Shiokawa assured Mahathir that Japan would continue to provide aid to Asia despite Japan facing a prolonged economic slump, the official said.
Japan and Malaysia are significant trading partners, with Tokyo among Malaysia's top export markets.
It absorbed 10.6 percent of Malaysia's exports in October 2002, amounting to US$1.13 billion. Imports from Japan in October last year amounted to $1.2 billion.
Japan has also extended millions of dollars in loans with low interest rates to Malaysia and remains an important source for Malaysia's external borrowings.