By DPA,
Bali Island (Indonesia): Japan will establish an emergency fund of up to 60 billion dollars in the event of an Asian financial crisis, Japanese Finance Minister Kauru Yosano said Sunday.
The fund is separate from the amount Japan committed to the Chiang Mai Initiative, a $120 billion regional foreign-exchange reserve pool, Yosano told a seminar of the Asian Development Bank’s board of governors on the Indonesian resort island of Bali.
Japan has also decided to provide guarantees up to 500 billion yen ($5 billion) on yen-denominated bonds issued in Japanese markets by developing countries unable to raise funds though bond issuance due to market turmoil, the minister said.
“I expect that by means of these measures, the current crisis will help trigger a transformation of the economic structure of Asian developing countries into a more balanced one that will enable them to restart their robust growth,” Yosano said.
Finance ministers from the Association of South-East Asian Nations (ASEAN), Japan, China and South Korea were due to meet Sunday to hammer out details of the currency-reserve pool, designed to help defend regional currencies from the effects of the global crisis.
Yosano told reporters after meeting his Chinese and South Korean counterparts Sunday that Japan and China would would each commit $38.4 billion, or 32 percent, to the fund, while South Korea would provide $19.2 billion.
The reminder would come from the 10 ASEAN members – Brunei, Cambodia, Laos, Malaysia, Myanmar, Indonesia, the Philippines, Singapore and Thailand.
The 13 countries agreed to increase the fund pool’s size to $120 billion, from $80 billion during earlier talks.
Asian Development Bank (ADB) president Haruhiko Kuroda Saturday said the bank planned to set up a $3 billion fund to provide emergency loans to crisis-hit member countries faster and cheaper than under the bank’s existing programmes.
The fund would help increase total loan disbursements by the bank by $10 billion to $32 billion over the next two years, Kuroda said.
The ADB’s board of governors were due to hold an annual meeting in Bali Monday and Tuesday.
The bank warned that the crisis would keep more than 60 million people in developing Asia trapped in poverty this year and nearly 100 million more in 2010.
The International Labour Organization estimated that 20 million workers would lose their jobs in Asia.