TOKYO, May 1 — Japan, China, South Korea and Asean countries are expected to expand their emergency currency swap programme to include infectious disease outbreaks and natural disasters as early as this month.
Nikkei Asia reported that a currency swap arrangement, the Chiang Mai Initiative, created after the 1997-1998 Asian financial crisis, exists to support regional financial stability by allowing members to tap currency swap lines to support currencies in need.
The expansion came as some countries faced foreign currency shortages during the Covid-19 pandemic.
The members of the initiative are likely to agree on the expansion when their representatives meet in Milan, Italy, on Sunday. The change would likely take effect in May.
The Chiang Mai Initiative pool amounts to US$240 billion (RM1.03 trillion) in foreign exchange reserves, with Japan and China each contributing US$76.8 billion (RM331.4 billion), South Korea providing US$38.4 billion (RM165.7 billion), and the 10 Association of Southeast Asian Nations members a combined US$48 billion (RM207.1 billion).
— Reuters
