AMRO

Initially established as a company limited by guarantee in Singapore in April 2011, and transformed into an international organization in February 2016.

• Mandate. AMRO was established to contribute to securing macroeconomic and financial stability of the region through the conduct of macroeconomic surveillance; to provide support to the operationalization of the CMIM, a multilateral currency swap arrangement among ASEAN+3 members; and to conduct technical assistance (TA) for capacity building needs of members. AMRO's vision is to be an independent, credible and professional regional organization acting as a trusted policy advisor to members in the ASEAN+3 region.
   
• Core functions. For surveillance work, AMRO's operational priorities are to strengthen country surveillance; reinforce regional surveillance; develop a comprehensive surveillance framework and analytical toolkits; and enhance the work on functional and sectoral surveillance, and on thematic studies and research. In terms of CMIM support, AMRO's effort centers on providing intellectual assistance to the members to ensure that the CMIM is operationally ready. AMRO provides TA to the members to enhance their human and institutional capacities for macroeconomic surveillance and implementation of CMIM in the form of secondment, consultancy, and research and training programs. AMRO hosts, co-organizes and participates in regional and global events on macroeconomic and financial issues, and strengthens partnerships with peer international organizations, academic institutions, and the private sector.
   
• Governance. AMRO is governed by the Executive Committee comprised of Deputies of the 13 Finance Ministries and 14 Central Banks/Monetary Authorities of the ASEAN+3 region. Day to day operations are overseen by AMRO's senior management composed of a Director; a Senior Economist in charge of research and surveillance; and two Deputy Directors (one for Administration, one for CMIM, Strategy and Coordination).  A six-person Advisory Panel guides the surveillance work of AMRO (three representing the Plus 3 sub-region and three for ASEAN).

Link to the AMRO website

CMIM

US$240 billion regional financing arrangement that aims to: (a) address potential and actual balance of payments (BOP) and USD short-term liquidity difficulties in the region; and (b) supplement existing international arrangements. Each CMIM participant is entitled, in accordance with the procedures and conditions set out in the Agreement, to swap its local currency with US dollars for an amount up to its contribution multiplied by its purchasing multiplier.

 

• History. The CMIM is an upgrade of the Chiang Mai Initiative, a network of bilateral swap arrangements among the ASEAN+3 countries. This network of bilateral arrangements was multilateralized into a single contractual agreement among member countries.
  
  The CMIM was signed on 28 December 2009 and came into effect on 24 March 2010. The initial size of the CMIM Arrangement was US$120 billion comprised of contributions from the CMIM Parties. At the 15^th AFMGM+3 held in Manila on 3 May 2012, the CMIM features were enhanced involving the doubling of its size to US$240 billion; introducing a crisis prevention facility; and increasing the IMF De-Linked Portion (IDLP) from 20 percent to 30 percent. In 2016, pursuant to Article 17 of the CMIM Agreement, a periodic review of the same was undertaken from 2017 to 2018. The resulting proposed amendments were approved by the Finance Ministers and Central Bank Governors on 2 May 2019 in Nadi, Fiji and took effect on 23 June 2020.  Recently, by virtue of an ad hoc amendment and as approved by the senior officials in September 2020, the CMIM features were further enhanced which are expected to be disclosed upon effectivity of the said amendment to the CMIM Agreement.

 

• Governance. CMIM is governed by the policy-making Ministerial Level Decision Making Body in-charge of fundamental aspects of the facility.  The Executive Level Decision Making Body (ELDMB) handles the executive-level issues and approves CMIM arrangements requests. The Coordinating Countries, represented by the current Co-chairs of the ASEAN+3 Finance Process with support from AMRO and backed by the CMIM Taskforce, undertakes the operational aspects. Decisions are made by 2/3 majority vote at the ELDMB-level.

Link to the CMIM FAQ

ABMI

The ABMI was launched in December 2002 by the ASEAN+3 member countries to develop local currency (LCY) bond markets as an alternative source of funding to foreign-currency denominated bank loans to minimize the currency and maturity mismatches that had made the region vulnerable to the sudden reversal of capital inflows. Policymakers in the ASEAN+3 region have also aimed to promote regional financial cooperation and integration under ABMI. This approach is based on the rationale that more developed and integrated LCY bond markets would enable the economies in the region to mobilize domestic savings to finance their long-term investment needs and reduce their vulnerabilities to the reversal of capital flows.

• The Asian Development Bank (ADB) has been working with ASEAN+3 and serving as Secretariat to provide technical support for the implementation of the initiative.
• The ASEAN Secretariat, under the Technical Assistance Coordinating Team (TACT), coordinates the provision of technical assistance projects to interested member countries including the Philippines.
• The ABMI Taskforce meetings are held semi-annually as well as the Finance and Central Bank Deputies' meeting.  The accomplishments for the year are reported to the annual meeting of the Finance Ministers and Central Bank Governors.

 

ABMI Taskforces

Task Force 1: Promoting the issuance of LCY denominated bonds.  ASEAN+3 established the Credit Guarantee and Investment Facility (CGIF) as an ADB trust fund in 2010 to provide credit enhancement to increase the access of investment-rated firms to LCY bond markets and lengthen the maturities of their bonds. With CGIF guarantees, eligible firms will be able to meet their long-term financing needs by tapping domestic bond markets and markets across the region. CGIF as such will help reduce firms' dependency on short-term foreign currency loans and minimize their vulnerability to sudden reversals of capital flows to the region.

Task Force 2: Facilitating demand for LCY denominated bonds. The ABMI website, AsianBondsOnline, was established to provide data and analyses on LCY bond markets in ASEAN+3, as well as a step-by-step primer on the mechanics of buying and trading Asian government securities. This website also provides information on related custodian and registry arrangements and internet links to market sources. Bond market guides which include information on legal and regulatory frameworks, characteristics of the domestic bond market, among others, are on the same website.

Task Force 3: Strengthening the regulatory framework.  The ASEAN+3 Bond Market Forum (ABMF) was established in May 2010 as a common platform to foster standardization of market practices and harmonization of regulations relating to cross-border bond transactions in the region. The ABMF is expected not only to lead the region towards more harmonized and integrated markets, but also to act as the link between ASEAN+3 and the rest of the world in international standard setting and rule-making.

Task Force 4: Improving related infrastructure for bond markets.  ASEAN+3 policy makers agreed to set up a Cross-Border Settlement Infrastructure Forum (CSIF) to discuss work plans and related processes for the improvement of cross-border settlement in the region, including the possibility of establishing a regional settlement intermediary. Central banks and Central Securities Depositories (CSDs) in ASEAN+3 will continue to work toward implementing CSDs–real-time gross settlement (CSD–RTGS) linkages over the medium-term.

Link to the ABMI website