Asian countries lend each other a financial hand

On the sidelines of the G20 summit, China, Japan and South Korea on November 14th said they would expedite a joint effort among Asian countries to help each other weather the global financial storm. Their decision to bolster the existing regional currency-swap arrangement was, like the G20 communique itself, only an agreement in principle lacking the nitty-gritty details. But the renewed push for the so-called Chiang Mai Initiative (CMI) by three of Asia's biggest economies means that this brainchild of the regional financial crisis of 1997-98 may at last live up to its promise.

Reeling from a sinking currency and shrinking foreign-exchange reserves, South Korea reached out to China and Japan for concerted action. In Washington, Seoul obtained Beijing's and Tokyo's consent to consider bigger limits for bilateral currency swaps among them. (The current amount between South Korea and Japan is US$13bn, and between South Korea and China is US$3bn.) And the three countries pledged to expand similar co-operation with the ten members of the Association of South-East Asian Nations (ASEAN). ...