An Asian Monetary Fund in the Making?

Abstract

This paper examines the pooled regional financial mechanism created in East Asia pursuant to the ASEAN 3 Chiang Mai Initiative. It examines the origins of the new facility and discusses the near-term challenges that its architects will face in creating a credible and effective mechanism for delivering liquidity support. It argues that although technical hurdles exist, the most important impediments involve political contestation among member states and the need for the fund to interact constructively with markets and external players, including the IMF.

Keywords: Chiang Mai Initiative, ASEAN 3, international finance, International Monetary Fund