Chiang Mai Initiative Multilateralisation Agreement takes effect

BANGKOK, July 17 (TNA) - Thailand and other member countries of the Association of Southeast Asian Nations (ASEAN) have signed the Chiang Mai Initiative Multilateralisation Agreement with the 10-member bloc's three key dialogue partners of China, Japan and South Korea and Hong Kong, aimed to prevent any repeated economic crisis in the region. The Bank of Thailand (BOT) said in a statement, released on Thursday, that the agreement, signed by central bank governors and financial ministers of the so-called ASEAN+3 economies and Hong Kong, takes immediate effect from July 17, 2014, enabling the member economies to help tackle the liquidity problem of one another. Under the agreement, revised from the original Chiang Mai Initiative Agreement concluded about a decade ago, the size of the stability facility contributed by the ASEAN+3 economies double increases, from 120 billion US dollars to 240 billion, and financial assistance for any member economy in trouble which is not liked with conditions set by the US-based International Monetary Fund (IMF) rises from 20 per cent to 30.3 per cent of the pooled fund. Besides, financial assistance can be made to prevent, instead of solving, an economic crisis in a member economy. Thailand's contribution to the pool, under the improved deal, rises from 4.552 billion US dollars to 9.104 billion US dollars, the sum of which comes from the country's foreign-exchange reserves. Thailand can, thus, seek assistance equivalent to 2.5 times of its contribution or 22.76 billion US dollars, up from 11.38 billion US dollars in the original deal. According to the BOT statement, the amended agreement shows stronger financial cooperation in the region. (TNA)