Political Conflict and Economic Integration
Edited by Jehoon Park, T. J. Pempel and Gérard Roland
Chapter 8: Financial Cooperation within the ASEAN +3: Viability and Prospects
8. Financial cooperation within the ASEANϩ3: viability and prospects* Jin-Young Kim INTRODUCTION: APT AND FINANCIAL COOPERATION The Asian ﬁnancial crisis of 1997–98 set in motion a movement toward enhanced East Asian regionalism. The movement was spurred by a relatively new body, the ASEAN Plus Three (APT). Even before the Asian currency crisis occurred, there had been calls for East Asian regional cooperation – most notably an appeal to create the East Asian Economic Group, made by Prime Minister Mahathir of Malaysia. However, his appeal did not bear immediate fruit due to Japan’s reluctance and a lukewarm response from other countries. The Asian crisis, however, made East Asians more keenly aware of the need for regional economic cooperation (Terada, 2003), and hence stimulated them to set up their own cooperative system. There was a widely shared perception in East Asia that more prompt countermeasures to deal with the early signs of the Thai crisis could have mitigated both the spread of the crisis and the huge fallout costs subsequently incurred by the Asians. The hands-oﬀ attitude of the US toward the Asian crisis contrasted sharply with its prompt action to the Mexican Peso crisis of 1994, and East Asians’ related sense of disappointment and betrayal was aggravated by the US opposition to an Asian Monetary Fund proposed by Japan that might have dealt with the short-term liquidity problems facing several Asian countries. During the ﬁnancial crisis, moreover, the existing Asia-Paciﬁc Economic Cooperation (APEC) was, in fact, of little use...
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