Japan, China, South Korea, ASEAN to expand currency swap programme, Nikkei says

Japan, China, South Korea and ASEAN countries are expected to expand their emergency currency swap programme as early as this month to include infectious disease outbreaks and natural disasters, Nikkei Asia reported on Thursday.

A currency swap arrangement known as the Chiang Mai Initiative, created after the 1997-98 Asian financial crisis, exists to support regional financial stability by allowing members to tap currency swap lines to support currencies in need.

The expansion came as some countries faced foreign currency shortages during the COVID pandemic, Nikkei said.


The members of the initiative are likely to agree on the expansion when their representatives meet in Milan, Italy, on Sunday, Nikkei said, adding that the change would likely take effect in May.

The Chiang Mai Initiative pool amounts to $240 billion in foreign exchange reserves, with Japan and China each contributing $76.8 billion, South Korea providing $38.4 billion and the 10 Association of Southeast Asian Nations members a combined $48 billion.