China injects $38 bln into Asian crisis fund

Special
Report: Global Financial Crisis

BEIJING,May 4-- China, Japan and South Korea Sunday finalized
details of an emergency 120 billion U.S. dollars liquidity fund to help 13 Asian
economies counter the global economic downturn.

The three nations will contribute on a 2:2:1 ratio - 38.4 billion U.S.
dollars from China and Japan and 19.2 billion U.S. dollars from South Korea -
making up 80 percent of the fund, known as the Chiang Mai Initiative.

Chinese Finance Minister Xie Xuren
attends a joint press conference of finance ministers of the Association
of Southeast Asian Nations, China, Japan and South Korea (ASEAN+3), in
Bali, Indonesia, May 3, 2009. The ASEAN+3 finance ministers reached on
Sunday the agreement on all main components of regional reserve pool, and
will implement it before the end of this year. (Xinhua/Yue
Yuewei)
Photo
Gallery

Japan has also launched a separate scheme to supply up to 6 trillion yen
(61.5 billion U.S. dollars) to support nations hit by the economic crisis.

Both announcements were made on the Indonesian island of Bali, on the
sidelines of the Asian Development Bank's (ADB) annual meeting.

South Korean Minister of Finance Yoon Jeung-hyun told reporters after a
meeting with counterparts from China and Japan that Beijing and Tokyo would each
contribute 32 percent to the regional initiative.

Chinese Finance Minister Xie Xuren (L)
poses for a group photo with his Japanese counterpart Kaoru Yosano (C) and
his South Korean counterpart Yoon Jeung-hyun before their meeting in Bali,
Indonesia, on May 3, 2009. (Xinhua Photo)
Photo Gallery

South Korea would provide 16 percent, while the rest would come from the
10-member Association of South East Asian Nations (ASEAN), he said.

The fund will give emergency balance of payments support to any country
experiencing the kind of capital flight that marked the Asian financial crisis
of 1997-98.

"The three countries have reached an agreement, recognizing the importance
of our cooperation in the region," said Yoon.

The deal between the key players over what would be the region's first
anti-crisis fund makes it likely all countries involved would conclude
negotiations on the initiative by the end of the day. ASEAN includes Brunei,
Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore,
Thailand and Vietnam.

ADB lending

The ADB also plans to counter the crisis by ramping up lending to about 33
billion U.S. dollars over the next two years, almost a 50 percent increase on
2007-08. The Manila-based multilateral lender is funded by donations mainly from
Japan, the United States and European nations.

"The economic crisis in Asia has had a much more severe impact than
probably we have reckoned," said Rajat Nag, managing director-general of the
ADB.

Jong-Wha Lee, its acting chief economist, added economies in Asia had
probably hit the bottom of the crisis but a major recovery still hinged on the
revival of demand in developed nations, while officials suggested growing
efforts by Asian nations to protect themselves will complement the role played
by the International Monetary Fund (IMF) in combating the global recession.

"We are seeing a greater multi-lateralisation and expansion of the Chiang
Mai Initiative, which is not at the cost of the region's role in the IMF or the
IMF's role in the region," said Nag, who added: "If the region is going to be an
economic growth center it is appropriate it knows it has the resources and
reserves to stand on its own feet."

(Source: China Daily)

China, Japan, S Korea reach agreement
on distribution ratio of regional reserve pool

BALI, Indonesia, May 3 (Xinhua) -- China, Japan, and South
Korea have reached an agreement on the distribution ratio of a 120-billion-U.S.
dollar regional foreign-exchange reserve pool plan here on Sunday.

China, Japan, and South Korea will contribute to the pool
on a 2:2:1 ratio, namely 38.4 billion U.S. dollars from China and Japan each and
19.2 billion from South Korea. Full story

ASEAN countries agree on individual
contributions to regional reserve pool


PATTAYA, Thailand, April 9 (Xinhua) -- The ten
member countries of the Association of the South East Asian (ASEAN) Thursday
agreed on individual contributions to the foreign reserve pool, Thailand's
Finance Minister Korn Chativanij said in a joint press conference in beach
resort Pattaya in Thailand's central province of Chonburi.

The agreement was made during the 13th ASEAN Finance
Ministers' Meeting ahead of the ASEAN Plus Three summit, to be held April 10 to
12 in Pattaya. Full story