EMEAP, the Executives’ Meeting of East Asia-Pacific Central Banks, is a cooperative organization of central banks and monetary authorities (hereinafter simply referred to as central banks) in the East Asia and Pacific region. Its primary objective is to strengthen the cooperative relationship among its members. It comprises the central banks of eleven economies:
Reserve Bank of Australia
People’s Bank of China
Hong Kong Monetary Authority
Bank of Japan
Bank of Korea
Bank Negara Malaysia
Reserve Bank of New Zealand
Bangko Sentral ng Pilipinas
Monetary Authority of Singapore
Bank of Thailand
Since its establishment in 1991, EMEAP activities have evolved gradually but steadily. This short note gives a brief history of EMEAP and its present activities.
Developments in the early stages
EMEAP was established in 1991. Executive-level meetings were held twice a year for the informal exchange of information and discussion of ideas concerning economic and financial developments in the region. Frequent and regular contacts helped foster closer cooperation among member central banks, which paved the way for the further development of EMEAP.
Establishment of the Governors’ Meeting and Working Groups
In 1996, against the background of the increasing interdependence of member economies, the structure of EMEAP activities was strengthened. The first EMEAP Governors’ Meeting, hosted by the Bank of Japan, was held in Tokyo on July 19. During the meeting, two landmark decisions were reached: one, to hold Governors’ Meetings once a year; and two, to establish two Working Groups (the Financial Market Development WG and Central Banking Operations WG), and one study group (the Banking Supervision SG), to undertake studies on the primary functions of central banks.
Asian Bond Fund (ABF) Initiative
The ABF Initiative is a historic milestone in central bank cooperation in Asia. For the first time, EMEAP central banks and monetary authorities have set aside a small part of their foreign reserves for collective investments into domestic bonds in Asia to broaden and deepen the Asian bond markets.
In June 2003, EMEAP launched the first stage of ABF (ABF1), which invests in a basket of US dollar denominated bonds issued by Asian sovereign and quasi-sovereign issuers in EMEAP economies (excluding Australia, Japan and New Zealand). Building on the success of ABF1, EMEAP worked to extend the ABF concept to bonds denominated in local currencies and announced the launch of the second stage of ABF (ABF2) in December 2004.
The initiative is a demonstration of EMEAP’s commitment to achieve a common objective of deepening and broadening the Asian bond markets for greater financial stability and integration. In particular, the ABF2 project involves EMEAP central banks taking part, in partnership with the private sector, in product design, execution and promotion. This approach has enabled all EMEAP central banks to gain an in-depth understanding of the market structure, regulatory system and impediments to financial intermediation of all other EMEAP economies.
Present Organization and Activities
Over the past decade, EMEAP has continually reviewed its direction and activities to ensure the work of the group consistently supports its overall goal of building greater regional cooperation. In this regard, the Monetary and Financial Stability Committee was established in 2007, which has been tasked to enhance the macro-monitoring and crisis management mechanisms of EMEAP.
Current EMEAP activities are divided into three levels: firstly, the Governors’ Meetings; secondly, the Deputies’ Meetings and the Monetary and Financial Stability Committee (MFSC), of which the Deputies are members; and finally, the Working Groups. The Working Groups are, the WG on Payments and Market Infrastructures (WGPMI), the WG on Financial Markets (WGFM), and the WG on Banking Supervision (WGBS). In addition to these Working Groups, there are the IT Directors’ Meeting (ITDM) and the Study Group on Resolution (SGR).
Where Is EMEAP Heading?
The financial crisis in Asia affirmed the importance of EMEAP activities, which have nurtured the regional network of information exchange and mutual trust. Despite the recent proliferation of international meetings and institutions, EMEAP has succeeded in maintaining its uniqueness as a meeting for central banks in the region. The ongoing work of EMEAP will seek to draw upon this unique position to further strengthen policy analysis and advice within the region, while continuing to develop and encourage co-operation with respect to operational and institutional central banking issues.