Following the Asian financial crisis, the development of local currency bond markets in each of the APEC economies as well as regional bond markets has received the highest priority among financial market policy-makers. Bond markets are considered as an alternative vehicle for domestic savings mobilization and also as a critical means of mitigating the dual mismatch problems of currency and maturity. However, tangible achievements have yet to materialize. The appeal of Asian bonds as evidenced by cross-border investments is dismally insignificant. Given the limited level of market activities associated with foreign investment in Asian bonds and with the supply of local currency or foreign currency denominated bonds issued by foreign borrowers in Asia, this study is designed to identify the types of impediments to cross-border investment in Asian bonds and to propose policy recommendations.

The Asian Bond Markets Initiative (ABMI) was launched in December 2002 by the Association of Southeast Asian Nations (ASEAN) and the People’s Republic of China, Japan, and the Republic of Korea---collectively known as ASEAN+3 to strengthen financial stability and reduce the region’s vulnerability to the sudden reversal of capital flows. This paper also provides recommendations for addressing new sources of market volatility and other challenges within and outside the framework of the Asian Bond Markets Initiative.

This conference report provides a unique overview of the development of local currency bond markets in the Asia-Pacific region and cross-border investment and issuance in these markets. It brings together insights of the region's leading capital market regulators, private sector market players, finance and central bank officials and experts from academe and international development organizations, who have gathered together to assess the extent to which the region's bond markets have developed, and map out a regional strategy based on public-private sector partnership that promises to address key policy reform and capacity-building issues.

This volume comprises studies by leading research scholars in the United States and Asia on Asia’s debt capital markets. The book is unique in drawing upon the research, experience and perspectives of experts from the academic, legal, governmental and practical investment fields. They assess the risks and opportunities, and strategies for developing these markets. The authors adopt a multidisciplinary approach, encompassing economics, finance and law.

Developments in East Asia have progressed rapidly in terms of regionalism since the 1997 crisis. The end of the Asian miracle called into question not only the capacity of regional states to meet the needs of their attendant peoples, but also challenged the viability of regional organizations, such as ASEAN, to adapt and respond to the changing circumstances. Advancing East Asian Regionalism looks at the ways in which ASEAN has expanded since the crisis, and evaluates the potential of East Asia to come together in a regional formation - one capable of representing the region as a whole - akin to the European Community. It draws upon the knowledge and perspectives of academics and policy makers actively engaged in the contradictory issues of regionalism. Coupling case study material on regionalism, institutions, and sectoral cooperation, with theoretical debates on regionalization, this book is an invaluable resource that pushes our understanding of East Asian regionalism forward.

The absence of vibrant bondmarkets in East Asia was a significant contributor to the 1997–98 financial crisis. Ever since, the development of local bondmarkets has been a major objective of financial reforms in many East Asian economies. This effort has been frustrated by the inability to reach a consensus on whether Asian bondmarkets are truly needed in East Asia, whether they can be made viable in the competitive environment of the global economy, how they should be created and what role intergovernmental cooperation should play in their definition and creation. Developing Asian Bondmarkets helps build this consensus, proposing how to develop robust and efficient bondmarkets in East Asia. This book, the first of its kind, comes from the Finance Forum of the Pacific Economic Cooperation Council.

The Asian Development Bank (ADB) has been working closely with the Association of Southeast Asian Nations (ASEAN) and the People's Republic of China (PRC), Japan, and the Republic of Korea---collectively known as ASEAN+3---to promote the development of local currency bond markets in the region through the Asian Bond Markets Initiative (ABMI). ABMI was launched in 2002 to help channel regional savings toward long-term investments within the region. ABMI was established with the goal of improving the resilience of the region's financial systems by helping reduce the double mismatches (maturity and currency) of companies' investment financing. Since the launch of ABMI, local currency bond markets in the region have grown rapidly in recent decades in terms of size and diversity of issuers. This study was undertaken under ABMI and funded by the Government of Japan. It focuses on measures to expand the investor base for local currency bonds in ASEAN, the PRC, and the Republic of Korea, with the goal of generating greater variety in investment objectives and a wider range of investment strategies.

The Asian Development Bank (ADB) has been working closely with the Association of Southeast Asian Nations (ASEAN) and the People's Republic of China, Japan, and the Republic of Korea---collectively known as ASEAN+3---to foster the development of local currency bond markets and facilitate regional bond market integration under the Asian Bond Markets Initiative (ABMI). ABMI was launched in 2002 to strengthen the resilience of the region's financial system by developing local currency bond markets as an alternative source to foreign currency denominated short-term bank loans for long-term investment. Bond investors typically have a long position in local currency bond markets. To manage their foreign exchange (FX) risk, they may want to hedge that exposure for a period of time. They also want to be sure they can easily convert the local currency to dollars upon the sale of a bond. This study was undertaken under ABMI and funded by the Government of Japan. It reviews the FX and FX hedging markets in ASEAN+3 as they relate to cross-border investments in local currency bonds, and makes recommendations to facilitate the development of the markets and FX risk management.

This study analyzes the key issues and constraints -- in terms of efficiency, access and safety and soundness -- faced by East Asian countries in developing their financial markets which are at different stages of development, drawing on global experience. The study takes stock of the initiatives being undertaken at the regional level to foster greater financial integration as a means of deepening and diversifying financial markets, and on the policy issues that need to be addressed at the domestic level to deepen and diversify financial markets and to actually benefit from the actions that are being taken at the regional level.

Launched in 1992, Regional Outlook is an annual publication of the Institute of Southeast Asian Studies, published every January. Designed for the busy executive, professional, diplomat, journalist, or interested observer, Regional Outlook aims to provide a succinct analysis of current political and economic trends shaping the region, and the outlook for the forthcoming two years. This forward-looking book contains focused political commentaries and economic forecasts on all ten countries in Southeast Asia, as well as a select number of topical pieces of significance to the region.