Finance Minister Masajuro Shiokawa and Jamaludin Mohamed Jarjis, Malaysia's second finance minister, agreed Monday that Asia's bond markets should be nurtured to stabilize regional currency swings and bolster economic growth, according to a ministry official.
During a meeting at the ministry, the pair agreed the region should promote use of Asian currency-denominated bonds in an effort to limit exchange risks involving local currencies and the dollar, the official said.
The initiative is aimed at nipping in the bud any prospects of financial crises such as the 1997-1998 Asian currency crisis.
The relevant parties are hoping to reduce the region's heavy dependence on the dollar and concomitant exchange swings vis-a-vis local currencies.
In January, Shiokawa agreed with Malaysian Prime Minister Mahathir Mohamad, who doubles as finance minister, on the need for bond markets of this kind.
During Monday's meeting, Jamaludin said Malaysia is considering ways of enticing smaller Japanese companies to invest more in his country by, for example, facilitating the use of existing factories so they are not obliged to build costly new ones.
According to Shiokawa, although the small and midsize companies that have invested in Malaysia have mainly been those in the information technology field, it would be better if more firms dealing in daily goods did so, the official said.