On March 30, 2021, a Delegation from the State Bank of Vietnam (SBV) attended the 7th ASEAN Finance Ministers’ and Central Bank Governors’ Meeting (AFMGM), and the Special Session between ASEAN Finance Ministers, Central Bank Governors and Heads of International Financial Organizations. This was the most important event organized on an annual basis for ASEAN Finance Ministers’ and Central Bank Governors.
Attending the Meeting, there were Central Bank Governors, Finance Ministers, representatives from various international organizations and business associations, for example the Asian Development Bank (ADB), the Asian Infrastructure Investment Bank (AIIB), the ASEAN+3 Macroeconomic Research Office (AMRO), the World Bank (WB), the US-ASEAN Business Council (US-ABC), the EU-ASEAN Business Council (EU-ABC), the ASEAN Business Advisory Council (ABAC). Due to the impacts of the COVID-19 pandemic, the AFMGM this year continued to be organized virtually.
At the Meeting, Brunei Darussalam, as Chair of ASEAN 2021, presented on the cooperation priorities in 2021 with the theme of “We care, We prepare, We prosper”. In the finance and banking sector, the Monetary Authority of Brunei Darussalam (AMBD) and Brunei Finance Ministry had selected three priorities, namely “Recovery, Digitalization, Sustainability”. In order to implement these three priorities, Brunei expects to enhance the cooperation with other ASEAN countries in the digitalization of financial services, enhancement of financial integration, strengthening of the connectivity, sustainable and stable development of the finance sector, diversification of macro safety regulations, etc.
About the macro economy, ASEAN Finance Ministers and Central Bank Governors spent time discussing and assessing the macro-economic situations, the monetary policy management and the banking operations, as well as the finance and banking integration process in 2020. According to the IMF’s outlook forecast, the world economy would start to recover in 2021 and 2022, reaching the estimated growth level of 5.5% and 4.2% respectively. For ASEAN, the AMRO's outlook forecast shows that the economic growth can reach 4.9% in 2021 and 5.7% in 2022, reflecting the expectations of the international financial institutions on the positive effects of the vaccination programs and the support policies implemented by the governments. Also according to the WB assessment, the recovery rates in different countries would be different, among which China and Vietnam are expected to achieve the highest growth rates of 9.1% and 6.6% respectively, the other ASEAN countries' growth rates would reach close to the level before the pandemic.
At the meeting, the international financial institutions also shared their outlooks on the economic recovery and sustainable development. At the end of this session, it was concluded by the Meeting's Co-Chair that the Governors had shared common views on the necessary measures to be taken for the process of economic recovery, including (i) On economy: apart from the traditional economic sectors, all parties agreed that the digital economy development is critical. The countries should concentrate on building digital infrastructure and connections; (ii) On human resources: it is necessary to focus on measures to protect people’s health, especially on accelerating and expanding the vaccination programs for all vulnerable people; (iii) Sustainable growth in parallel with environmental protection (Green Recovery).
ADB Representative presenting in the Special Session between ASEAN Finance Ministers, Central Bank Governors and Heads of International Financial Organizations
At the Meeting, several finance and banking cooperation initiatives were approved, including:
The ASEAN Sustainable Banking Principles Initiative: This was the SBV’s initiative for the banking cooperation process, which was formulated on the basis of the relevance with the world standards and practices on sustainable finance. This initiative will serve as guiding principles to help promote sustainable banking development in the region. At the Meeting, the ASEAN Central Bank Governors highly appreciated the substances and objectives of this initiative, and requested the technical officers to further study in order to put it into the ASEAN Sustainable Finance Cooperation Mechanism.
ASEAN Sustainable Finance Cooperation Mechanism: this initiative was formulated based on the directions of the ASEAN Finance Ministers and Central Bank Governors in 2020 to bring about an overall cooperation mechanism on sustainable development and green growth in the process of ASEAN finance and banking cooperation. The initiative is expected to promote the strategies of sustainable development and green growth in the member countries. This initiative would also be presented at the 26th United Nations Climate Change Conference (COP26) in November 2021.
Delegates in the Special Session between ASEAN Finance Ministers, Central Bank Governors and Heads of International Financial Organizations
Policy Report of the ASEAN Working Committee on Capital Account Liberalization (CAL): This is the document summarizing the ASEAN countries’ experience, which was formulated to support the common objectives.
Also within the framework of the Meeting, the ASEAN Finance Ministers and Central Bank Governors spent time exchanging and listening to the ABAC, the US-ABC and the EU-ABC recommendations on sustainable development, natural disaster mitigation, transformation from fossil fuel energy to renewable energy, etc.
The 8th ASEAN Finance Ministers’ and Central Bank Governors’ Meeting would be organized in Cambodia in 2022.
Le Hang