* Financial chiefs vow to use policy tools to overcome
pandemic
* Also voice need to calibrate timing of exiting crisis
steps
* Vow to boost FX swap arrangements to guard against crisis
(Recasts, adds ASEAN, detail)
By Tetsushi Kajimoto
TOKYO, Sept 18 (Reuters) - Financial leaders from China,
Japan, South Korea and Southeast Asia vowed on Friday to
redouble their efforts to help the region recover economically
from the novel coronavirus and to defend a multilateral system
of trade and investment.
"We will remain vigilant to the continued downside risks ...
We are taking steps to reduce vulnerabilities to these risks and
are determined to continue to use all available policy tools to
support the sustained recovery," they said in a joint statement.
"We will remain resolute in our commitment to uphold an open
and rule-based multilateral trade and investment system, and
strengthen regional integration and cooperation."
The statement followed the annual meetings of finance
ministers and central bank governors from China, Japan, South
Korea and the 10-member Association of South East Asian Nations
(ASEAN). The meetings were held via teleconference on the
sidelines of the annual gathering of the Asian Development Bank
(ADB).
The coronavirus pandemic has triggered deep downturns in
regional economies, disrupted global trade and supply chains,
and increased market volatility in Asia and beyond, prompting
authorities to enact large economic stimulus programmes.
Recognising the risk that unwinding such large stimulus
plans could destabilize financial markets, the ministers from
Japan, South Korea, China and ASEAN, a group known as ASEAN+3,
addressed how they will exit from the crisis measures.
"We will carefully measure the appropriate timing of the
exit from these pandemic measures in accordance with the
economic and pandemic situation of each member," the ASEAN+3
leaders said.
Highlighting worries about the risks of a hit to market
liquidity, Japan and Malaysia signed on Friday a bilateral
currency swap arrangement that enables authorities to swap up to
$3 billion of their currencies. The ASEAN+3 leaders also promised to boost the Chiang Mai
Initiative Multilateralisation (CMIM). The CMIM plays a crucial
role in supporting regional financial stability by allowing the
member economies, which include the ASEAN+3 and Hong Kong, to
tap currency swap lines to secure currencies in need.
"We expect the CMIM ... to be further strengthened to assist
the regional economies dealing with various crisis situations
including pandemics," they said.