Dubbed as the Asian version of the International Monetary Fund (IMF), the Microeconomic and Research Office (AMRO) of the Association of South East Asia Nations (ASEAN Plus Three) officially opened on January 31, 2012.

Dubbed as the Asian version of the International Monetary Fund (IMF), the Microeconomic and Research Office (AMRO) of the Association of South East Asia Nations (ASEAN Plus Three) officially opened on January 31, 2012.

The main functions of AMRO include monitoring economic development in the region, identifying risks and vulnerability within countries, and determining the use of reserve fund to members.   

Even though AMRO shares similar tasks with IMF, the urgent issue for AMRO is not to directly intervene the European sovereignty debt crisis, but to safeguard Asian financial stability and ward off the future financial crisis caused by European countries.

To be specific, an exit of any euro country from the euro currency bloc could possibly stimulate capital outflows from Asian countries. Under the circumstance, the fund will be an essential solution while stabilizing the financial system.

Apparently, the fund of US$120 billion seems insufficient for any current economic problems. Boosting the fund will certainly be the necessary topic among member nations.

Based in Singapore, AMRO serves as the first financial surveillance unit for regional economic and financial stability in Asia.

The origin of AMRO could be traced back to the Chiang Mai Initiative in 2000. Due to the financial crisis in 1997, which severely devastated Asian financial order, the ASEAN proposed a currency swap arrangement in Chiang Mai Initiative.

Later on, ASEAN Plus Three (China, Japan, and South Korea) reached an agreement on US$120 billion fund under the signing of the Chiang Mai Initiative Multilateralization in 2009 in order to address short-term liquidity while facing financial disruptions.  

The launching of AMRO not only further completes the financial mechanism in Asia, but also initiates a possibility of cooperative integration, such as a currency bloc for Asian countries.

While a great deal of economic crises is taking place in Western countries, Asian countries have speeded up the formulation of well-established financial system. Undoubtedly, the rebalancing of the worldwide economic structure is gradually occurring.

LEAVE A REPLY

Please enter your comment!
Please enter your name here