How regional cooperation works: the ASEAN and ASEAN+3 tracks, who meets and what they agree

Why the cooperation began

AMRO, the regional surveillance office of ASEAN+3, says that since the Asian financial crisis of 1997 the ASEAN+3 economies have worked together to deepen regional financial cooperation. ASEAN set up its own surveillance process in 1998, a peer review among senior officials and finance ministers. In May 2000 the ASEAN+3 economies established the Chiang Mai Initiative, a network of bilateral currency swap arrangements, which lesson 2 explains.

Japan's Ministry of Finance describes the core objectives of the Chiang Mai Initiative in its multilateral form as addressing balance of payments and short-term liquidity difficulties in the region, and supplementing the existing international financial arrangements. The same source presents ASEAN+3 financial cooperation in three main parts, the Chiang Mai Initiative Multilateralisation, AMRO and the Asian Bond Markets Initiative, and lessons 2 to 4 take them in turn.

Two tracks: ASEAN and ASEAN+3

The ASEAN track brings together the finance ministers and the central bank governors of the ASEAN member states. They first met jointly in Kuala Lumpur in March 2015, and the joint meeting is now known as the AFMGM. ASEAN has eleven member states since Timor-Leste joined, and the 2026 meeting welcomed Timor-Leste's full and active participation in all meetings of the ASEAN finance track.

The ASEAN+3 track adds China; Hong Kong, China; Japan and Korea. Its finance ministers and central bank governors meet once a year, in the meeting known as the AFMGM+3. Each meeting has two co-chairs, one from ASEAN and one from the Plus Three, and the role rotates every year, generally in alphabetical order: the 2026 co-chairs are the Philippines and Japan, and the 2027 co-chairs are Singapore and Korea. AMRO describes the ASEAN+3 economies as ten ASEAN members together with the Plus Three, and its list of member economies does not include Timor-Leste. In 2026 the ministers asked their deputies, with AMRO's support, to deepen Timor-Leste's understanding of the AMRO and Chiang Mai frameworks.

What the ASEAN track agrees

ASEAN lists its areas of work as including the liberalisation of financial services and of the capital account, the development of capital markets, cross-border payment links and financial inclusion. In 2026 the ministers endorsed the ASEAN Finance Sectoral Plan 2026 to 2030 in support of the ASEAN Economic Community Strategic Plan for the same years. They also noted the ASEAN Local Currency Transaction Framework, which supports the use of local currencies in cross-border trade and investment, and an improved heat map for tracking how far each member has opened its capital account.

Welcoming Timor-Leste, the same statement says that regional initiatives will be implemented in a phased way, based on readiness and taking account of members' different levels of development.

How far it binds: banks in ASEAN and in the euro area

Banking is an example. In the euro area, the European Central Bank directly supervises more than 100 significant banks, holding around 85 percent of banking assets in the participating countries, and has done so since November 2014.

In ASEAN, the ASEAN Banking Integration Framework has been taken forward through bilateral arrangements, such as the one between Malaysia and Thailand concluded in April 2019. Under it, a bank from one country may apply to become a Qualified ASEAN Bank in the other. Its home regulator must endorse its interest, it must be strong and well managed, and it must meet the host country's prudential requirements; a successful candidate receives the market access and operating flexibilities that the bilateral arrangement provides. In 2026 the ministers welcomed the completion of a review of the framework and endorsed new guidelines for it.

When reading regional agreements in Southeast Asia, note the difference: under this arrangement, market access is opened between the two countries, and the host country's prudential requirements still apply.

What the ASEAN+3 track builds

AMRO lists the main tracks of ASEAN+3 financial cooperation as:

• the Chiang Mai Initiative Multilateralisation, the regional financing arrangement, explained in lesson 2;
• AMRO itself, set up to carry out regional macroeconomic surveillance and to support the Chiang Mai Initiative, explained in lesson 3;
• the Asian Bond Markets Initiative, with its credit guarantee facility, explained in lesson 4;
• the Disaster Risk Financing Initiative.

In 2026 the ASEAN+3 ministers also said that the local currency bond market of ASEAN, China and Korea had grown 25-fold over the last two decades, agreed to widen the bond initiative into an Asian Bond and Financial Markets Initiative, and asked their deputies to agree by the end of the year on how to take forward work on cross-border payments. Lesson 5 covers payment links.

Questions to ask about a regional agreement

• Which track made it, ASEAN or ASEAN+3, and is the market concerned a member of that track's arrangements?
• Is it a shared direction, a framework that each member implements in phases, or a bilateral arrangement between two members?
• Has the market written it into its own laws or rules, and from when?
• Which supervisor and which rules apply to the lender in the host market, whatever the regional agreement says?

The rules pages show, for each market, the rules that apply to lenders today.