ASEAN determined to promote regional financial and monetary integration

On the afternoon of March 21, the 19th ASEAN Finance Ministers' Meeting (AFMM-19) and the first Joint Meeting of ASEAN Finance Ministers and Central Bank Governors concluded successfully.

ASEAN financial and central bank leaders have reached a high consensus on enhancing the development of regional financial markets towards the goal of establishing the ASEAN Economic Community (AEC), and are determined to closely coordinate and promote the process of regional financial and monetary integration after the AEC is established.

Overview of the 19th ASEAN Economic Ministers' Meeting. Photo: KVietnam+

At the ASEAN Finance Ministers' Meeting, the Ministers discussed the role of fiscal and monetary policies in poverty reduction, financing infrastructure development in Asia, proposing solutions for regional tax harmonization and integration, as well as cooperation in other areas such as insurance, customs, etc.

The Ministers agreed to strengthen the activities of the ASEAN Tax Forum to further promote the tax harmonization process, and acknowledged the progress made in customs cooperation, especially the successful implementation of the pilot project to connect the ASEAN Single Window Mechanism deployed in seven member countries.

At this conference, the Ministers signed the Protocol on the Legal Framework for the Implementation of the ASEAN Single Window (PLF-ASW) to further facilitate intra-bloc trade in goods.

In the insurance sector, the Ministers acknowledged the achievements of ASEAN insurance agencies in developing regulatory frameworks to promote insurance products, raise consumer awareness, increase insurance coverage and adhere to the core principles of the International Association of Insurance Supervisors in realizing the AEC objectives.

The Meeting noted that the ASEAN Infrastructure Fund (AIF) is a component of ASEAN's efforts to enhance regional connectivity and narrow the infrastructure development gap within the bloc.

Currently, AIF has a total capital of about 485.3 million USD. In 2014, the fund supported the energy transfer and clean water system project in Indonesia, and the energy linkage project in Vietnam.

At the Joint Meeting of ASEAN Finance Ministers and Central Bank Governors, financial and banking leaders focused on discussing the regional and global economic development situation, the progress of implementing initiatives under the ASEAN Financial Integration Roadmap and commitments to realizing the goals of the AEC in three areas: capital market development, capital account liberalization and financial services liberalization, and priorities for financial cooperation and integration after the AEC is established.

The Ministers and Governors agreed to enhance financial market development, acknowledge the progress made in capacity building and long-term infrastructure building for the development of capital markets in ASEAN, and promote the implementation of the ASEAN Capital Market Development Forum’s initiative on harmonization and mutual recognition of capital market regulations.

At the Conference, Minister Dinh Tien Dung recommended that although ASEAN countries have different levels of development, they need to further strengthen cooperation in the tax sector to promptly have solutions to reduce budget revenue loss due to external fluctuations, and to prevent revenue loss, transfer pricing, and tax fraud.

The Joint Statement of the ASEAN Finance Ministers and Central Bank Governors Meeting emphasized that ASEAN member countries will continue to implement their commitments in promoting economic growth and financial stability in the region; share views with the Asian Development Bank (ADB), the World Bank (WB), the International Monetary Fund (IMF) and the ASEAN+3 Macroeconomic Research Office (AMRO) on economic prospects, risks, opportunities and policy challenges in promoting sustainable and inclusive growth; continue to implement the goals of the AEC as well as activities within the framework of the ASEAN Financial and Monetary Integration Roadmap.

Delegates also strongly affirmed their commitment to the AEC Vision beyond 2015.

On the sidelines of the above conferences, the Ministers met with the US-ASEAN Business Council and the EU-ASEAN Business Council to further enhance policy dialogue between policymakers and the business community.

According to Vietnam+