ISAS Working Papers

Ever since the currency crisis of 1997-98, there has been a great deal of interest in enhancing regional economic cooperation in Asia. It is important to keep in mind that economic regionalism is multidimensional nature. As noted by Kuroda (2005), economic regionalism can be broadly divided into four categories, viz. trade and investment; monetary and financial; infrastructure development and related software; and cross-border public goods (cooperation with regard to contagious diseases such as avian flu, SARS and swine flu, as well cross-border pollution such as the haze fires in Indonesia which affected many of its Southeast Asian neighbours). This paper concentrates on the issue of de jure monetary and financial regionalism in Asia. In other words, the focus here is on policy initiatives underway in Asia to enhance monetary and financial regionalism and the analytical bases for these initiatives, rather than on examining the actual level of financial and monetary links that already exists (which may or may not have been facilitated via regional policy mechanisms). A companion paper examines the de facto financial linkages within selected Asian economies (see Keil, Rajan and Willett, 2009).