7 ASEAN Commitments to Strengthen Economic Recovery and Financial Integration

7 ASEAN Commitments to Strengthen Economic Recovery and Financial Integration

ASEAN countries agreed to take advantage of the momentum of economic recovery in promoting ASEAN financial stability and integration. The 8th Joint Meeting of the ASEAN Finance Ministers and Central Bank Governors (AFMGM) also emphasized the commitment to strengthen cooperation in order to mitigate economic risks and challenges after the Covid-19 pandemic, climate change, digital disruption and geopolitical tensions.

The representatives of the countries present also emphasized that efforts to accelerate vaccination are a top priority, along with the importance of fiscal and monetary policies to encourage regional economic recovery. On the same occasion, Governor of Bank Indonesia Perry Warjiyo and Minister of Finance of the Republic of Indonesia Sri Mulyani welcomed and conveyed the readiness of Indonesia’s chairmanship in ASEAN in 2023 in welcoming the presence of delegates at the upcoming AFMGM implementation.

At the AFMGM meeting, several priority efforts were agreed to promote ASEAN financial stability and integration. First, to encourage the process of further integration of the regional financial services sector, including through the process of upgrading the financial services annex in the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA) negotiations.

Welcoming the completion of the study on ASEAN member states (AMS) “Financial Landscape Toward Furthering ASEAN Banking Integration in the Digital Era”. This will be an input for improving the ASEAN banking integration framework (ABIF) guidelines towards increasing banking integration in the digital era.

Second, appreciate the bilateral QR code payment linkages cross-border initiative among ASEAN member countries, which is expected to be the first step for the development of a cross-border payment network in the ASEAN region. This initiative could position ASEAN as a global leader in inclusive retail payments connectivity.

Third, support the issuance of the ASEAN Taxonomy version 1, which contains the key components of the sustainable finance taxonomy according to the needs of members. Also, in line with global initiatives to increase investment and sustainable financing.

The publication and socialization of the “Conversation Pack” is also expected to become the basis for discussion by various parties. In order to prioritize sustainable finance as the first choice in financing sustainable projects.

Fourth, support the ASEAN central bank initiative to strengthen the sustainable finance agenda through the establishment of two workstreams under the senior level committee task force (SLC-TF). This is aimed at building capacity on issues in the area of ​​sustainable finance and developing an ASEAN green map. Fifth, continue the commitment to increase financial inclusion through increasing access, use and quality of financial services in the region.

The meeting also appreciated the achievement of the average level of financial exclusion in ASEAN which had exceeded the target and welcomed the publication of the “Policy Note on Digital Financial Literacy” and “Measuring Progress 2021: Financial Inclusion in Selected ASEAN countries”. This supports financial inclusion measures as well as the integration of financial inclusion with economic inclusion as a whole.

Seventh, appreciate the completion of the Policy Note on Capital Account Safeguard Measures Recent Experiences and submission to the International Monetary Fund in order to enrich the treasures of discussion on the integrated policy framework from the point of view of ASEAN member countries. The 8th Annual Meeting of the Ministers of Finance and Governors of the ASEAN Central Banks 2022 raised the theme ASEAN ACT: Addressing Challenges Together.

At this meeting, views were also obtained from several international institutions, namely the International Monetary Fund (IMF), World Bank (WB), ASEAN+3 Macroeconomic Research Office (AMRO), Asian Development Bank (ADB), and Asian Infrastructure Investment Bank (AIIB). , as well as from several business organizations, namely the ASEAN Business Advisory Council, the EU-ASEAN Business Council, and the US-ASEAN Business Council.

Finance