NEWS - ASEAN says Japan may make cr

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Subject: NEWS - ASEAN says Japan may make crisis funds permanent

ASEAN says Japan may make crisis funds permanent

  
MANILA, Nov 26 (Reuters) - Japanese officials have agreed to endorse to
their government a proposal by the Association of Southeast Asian
Nations (ASEAN) to make permanent Tokyo's multi-billion dollar funds
available for crisis-hit neighbours. 

``They agreed to endorse it,'' Philippine Finance Secretary Edgardo
Espiritu told reporters on Friday, a day after ASEAN finance and central
bank deputies met their Japanese counterparts and agreed to enhance
financial cooperation. 

The funds include the Miyazawa initiative, a $30 billion fund so far
allocated to South Korea, Indonesia, Thailand, Malaysia and the
Philippines, as well as the $15 billion Obuchi fund, available on merit
for project financing, he said. 

Espiritu said the Japanese officials responded positively to the ASEAN
proposal to ``institutionalise'' the availability of the funds, which
Japan set up to help its neighbours recover from the the Asian currency
crisis that broke out in 1997. 

``The ministers of finance of the ASEAN feel very strongly that it's
very vital to institutionalise this kind of support that was given us by
Japan and make it available again in case there is a recurrence of a
similar crisis,'' Espiritu said. 

Philippine Finance Undersecretary Joel Banares, who attended the
deputies' meeting, said the 10-member ASEAN wanted a fund that would be
continually replenished if there were withdrawals. 

``What we mean by permanent is not putting an expiry to its
availability,'' he said. 

Espiritu said the proposed permanent fund would have the same functions
as the two existing ones, such as being available for co-financing of
projects, direct loans for various programmes, or guarantees for loans
and bond issues. 

``The availability will be similar...like the Philippines is using the
Miyazawa fund for co-financing, and Thailand is using it for corporate
restructuring,'' Espiritu said, adding that the terms of the fund would
also be concessional. 

``We are not just referring to fund assistance, but technical support
and enhancement of human resource development as well because Japan is
strong in training,'' he said. 

He did not respond to questions whether the fund proposed by the ASEAN
would be available only to its members -- Brunei, Cambodia, Indonesia,
Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and
Vietnam -- or to beneficiaries of the present Miyazawa fund. 

On questions on whether the fund would be funded exclusively by Japan,
Espiritu said the proposal was in early stages and had yet to be
discussed at higher levels. 

03:12 11-26-99