* Deals precede weekend Japan-ASEAN summit meeting
* Financial stability to ease jitters over Fed tapering
* Stable currencies contribute to Japan's interests -finmin
By Tetsushi Kajimoto
TOKYO, Dec 13 Japan is boosting bilateral
currency swaps with some Southeast Asian nations ahead of its
weekend summit meeting with leaders from the Association of
Southeast Asian Nations in Tokyo, Finance Minister Taro Aso said
The deals come at a time when Prime Minister Shinzo Abe
hopes the Japan-ASEAN summit - which does not involve China or
South Korea - will promote closer ties with Southeast Asia.
Tokyo nearly doubled its currency swap with Indonesia to
$22.76 billion in a deal aimed at providing an extra cushion
against potential disruptions when the U.S. Federal Reserve
begins tapering its massive monetary stimulus.
Japan also agreed to double its currency swap with
Philippines to $12 billion, while agreeing to re-enter a swap
deal with Singapore at $3 billion, Aso told reporters.
"I hope strengthening of financial cooperation will
contribute to stability in regional financial markets and
further development of bilateral economic and trade relations,"
he said. "Stable currencies will contribute to Japan's interests
The finance minister also said he hopes stability in
regional financial markets will ease jitters over a potential
impact from the pullback of U.S. stimulus.
Deals with Indonesia and Philippines include
crisis-prevention credit lines. Tokyo is also aiming to revive
lapsed agreements with Malaysia and Thailand, ministry officials
Liquidity arrangements with countries in the 10-member
Association of Southeast Asian Nations were a core element of
the global response to the late-1990s Asia financial crisis.
The bilateral arrangements build on the $240 billion "Chiang
Mai Initiative", a web of swap deals spanning ASEAN, Japan,
China and South Korea. Under the deals, countries pledge
bilateral liquidity support in case of a financial crunch.
The aim is to reassure investors before a crisis erupts and
thus prevent or minimise panic over balance-of-payment levels
that can cause destabilising capital outflows.
Abe has visited all 10 ASEAN leaders, but he has yet to meet
with his counterparts from China or South Korea, both of which
have territorial disputes with Tokyo. The other ASEAN members
are Vietnam, Cambodia, Myanmar, Brunei and Laos.