MANILA - Finance ministers of the Association of Southeast Asian Nations (ASEAN) on Tuesday expressed desire to accelerate the integration of the financial sectors of the regional bloc to provide better access to capital and make their respective economies stronger against external shocks.
Finance Secretary Cesar V. Purisima and Myanmar Finance and Revenue Minister U Win Sheing opened the morning session of the Asean Finance Ministers’ Investors Seminar with optimism that the financial integration of the region would make the ASEAN economies grow more rapidly.
“Inter-Asean trade is growing rapidly. In the past three years, the growth of inter-ASEAN trade has outpaced the growth of world trade. That just shows the benefits of a more connected, more harmonized Asean, which, as a single country, would have the third largest population and a gross domestic product of over $2 trillion,” Purisima said.
Purisima added that an integrated financial market in the ASEAN would make the individual economies more resilient to external shocks, such as the US Federal Reserve’s tapering last December. Purisima said this is because ASEAN is actually a net world creditor, with its vast foreign reserves totaling $816.54 trillion as of 2012 being bigger than its aggregate external debt.
“ASEAN is actually a net creditor, and our ability to withstand tapering is better if we are integrated. That’s why we have to accelerate the integration,” Purisima said.
Cambodia’s Secretary of State of the Ministry of Economics and Finance Nguon Sokha said Cambodia would benefit from integration because it would result in better access to capital through private banks and the central banks of its fellow ASEAN members.
Purisima added that financial integration would encourage local ASEAN banks to establish presence in each of the 10 Asean members which will speed up the flow of money and information in the ASEAN.
“We need to encourage our banks to be present in the ASEAN because banks are not only intermediaries of money but also information. That’s why we should encourage local banks to have more relationships with their counterparts. If we are to achieve the true potential of ASEAN integration, we need to see more banks cross borders,” he said.
Read more on BusinessMirror.