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Foster bond markets in East Asia: current situation, obstacles and prospects

Author: ChenHong From: www.yourpaper.net Posted: 2009-04-01 13:47:17 Read:
[Summary] East Asian economies led system of financial intermediation to banks, this is a result of history, East Asian economies, there is no other choice, the bank-dominated financial intermediary system plays an important role in foster bond markets in Asia. The authors believe that the focus should be on the objectives can be achieved through the improvement of the basic conditions for the development of the bond market. For the infrastructure East Asian economies, there are still many problems, this may be a more realistic way.
[Words] regional financial cooperation; East Asian bond markets; financial system
After the East Asian financial crisis, East Asian economies ... a common issue faced is how the regional savings for investment in the region to avoid double capital supply and demand mismatch. However, the underdevelopment of the East Asian economies, capital markets, corporate investment funds, the main source of bank borrowings, and nurture the bond market further development of direct financing means, became common in East Asian economies, within the framework of regional financial cooperation in East Asia.
So far, the program on the development of the Asian bond market there are two: First, from November 2002, brewing, officially launched in August 2003 by the ASEAN and China, Japan and South Korea 13 finance ministers and central bank governors meeting "Nurturing the Asian Bond Markets Initiative (ABMI)". The initiative covers various areas of securitization and credit guarantee, rating agencies, foreign exchange and capital controls and securities settlement, the purpose is to improve the basic conditions of the bond market. Recommended by the East Asia and Pacific Central Bank Governors meeting in June 2003 and December 2004, he proposed to create the Asian Bond Fund (ABF) ". The program is designed by the central banks of the member countries of the East Asia and Pacific Central Bank Governors meeting and a joint venture to invest in the Asian Bond Fund, aims to promote the development of the bond market from the investment point of view of the creation of bonds.
In recent years, governments and central banks of the East Asian economies continue to nurture the region's bond market efforts. According to the monitoring report of the Asian Development Bank, the bond market in 2006, the local currency bond markets of the East Asian economies, the proportion of gross domestic product (GDP) in 1997 to 17.27% in 2003, rose to 41.32% in 2004 and again in 2005, rose to 43.04% and 48.02%.
However, another fact that can not be ignored is the addition to participation by member States of the Central Bank, the Asian Bond Fund, as of mid-November 2006, the real development to the East Asian regional financial cooperation under the framework of the bonds issued in the name of the bond market is only four . One of the only Korean listed in Singapore stock issued yen-denominated the Korean SMEs bonds backed securities by the South Korean government financial institutions (Korean SME Bank) to provide security, the Japanese government financial institutions (JBIC) guarantee. One is the Japanese parent company to its subsidiary in Indonesia to provide security, the Japan Bank for International Cooperation reguarantee Indonesian local currency denominated bonds issued by Japanese-owned subsidiary by the local legal. The remaining two Japanese government or the Japanese government financial institutions to guarantee, provided by Japanese banks, local branches of Japanese companies in Thailand, the local baht-denominated bonds or financing to provide long-term financing.
By what means the intermediary savings and investment to reflect the relationship between finance and industry, it is inextricably linked with the economic development mode and stage of development of the economies. Regional financial cooperation is inherent in the financial system of the economies in the region, Therefore, cooperation is necessary to find the point of integration to enhance the ability to resist risks together, taking into account the characteristics of the existing financial system, the cooperation project has an operable sex.
Firstly, from the perspective of the financial system macro reveal realistic basis for the development of the bond market economies in East Asia. Secondly, according to the hypothesis about the convergence of regional financial cooperation as well as the integration process, the existing obstacles to the development of the bond market from the micro-level classification, and thus determine the feasibility of regional financial cooperation. Finally, the analysis of the future trends of the bond markets of the East Asian economies.
A realistic basis for the development of the bond market: the inherent form of the financial system
The banking system and market system is an important foundation for the financial system. As financial technology innovations, more risk means of transaction is used for risk and the allocation of resources, thereby improving the efficiency of the financial system, and therefore more attention in recent years, the market system. Here, the author based on the doctrine of the financial system is formed on the different types of financial system analysis of the opportunity to compare different systems to explore the conditions in the banking system, the development of the bond market in the savings into the investment process in the respective characteristics.
(A) the classification of the financial system
Range for the point of view of the classification of the financial system, this paper describes the history of the doctrine of the financial system has become conclusive several classification.
Three financial model says
The grid Shenke Long (Alexander Gerschenkron) the three financial model. First, the British model. British entrepreneurs from the early industrialization gradually adapt to the industrialization process, won the industrial development opportunities, which enable them to accumulate large amounts of money in a very short period, the external financing short-term bank borrowings and long-term investment funds and Do not rely on bank borrowings. The second is the German model. German industrialization process later in the United Kingdom, it is necessary to develop their own industries to speed more than the UK, to get the space for development. Compared to British companies, German companies need huge amounts of external funding. In this context of development, the German bank make every effort to the development of enterprises, the German bank not only to provide long-term funding, also provide other support to the business. Third, Russians mode. The grid Shenke Long considered as countries like Russia, is neither a developed industrial countries, the history of the enterprise system is very short, it is not possible to first develop the banking sector, wait until the accumulation of financial wealth enough for industrial financing, return to the development of industrial investment. Russian model is the Government to use the tax system, the accumulation of investment capital by inhibiting consumption.
Two major centers
The two main center is the financial model is divided into a banking center "and" capital market center from different angles.
First of all, pay attention to the amount of investment in physical capital. Carrington (John Carrington) and Edwards (George Edwards) continues to conduct research in the realm of theory, they are not only interested in the number of countries in the long-term financial investment in physical capital, and that part of the investment in physical capital is a function of the national financial system. They inspected in France, Germany, Japan, the United Kingdom and the United States financial system, analysis of the characteristics of the system of the United States and the United Kingdom, given the characteristics called "Anglo - Saxon" system. They believe that the "Anglo - Saxon" system, banks are reluctant to borrowers more enterprises to provide long-term loans, Therefore, the enterprise was compelled to withdraw funds from the internal retention for investment, which makes necessary from the stock market to raise part funds. Carrington Edwards is suppressed, weaken economic growth, it is this inertia makes business investment in the United States and the United Kingdom. In France, Germany and Japan, the bank financing to become a major source of investment funds, the financial system of these countries is the banking center (bank-based) ". Compared with the capital markets (capital market-based) "National Bank Center enterprises are likely to raise more long-term investment funds from external financial system countries.
Secondly, the investigation of the role of government. Zuozi Man (John Zysman) Carrington Edward Reference is made to the "banking center" and "capital market center are two types of financial system based on the investigation of the extent of the government intermediary. Zuozi Man have been classified in three ways. Same classification Carrington and Edwards. The second classification is carried out according to the pricing mechanism. Pricing mechanism into the financial system to competitive pricing, the dominant system of pricing and the government determines the price three. The third classification is divided according to the government's role in the financial system. The Government to manage the monetary aggregates, the allocation of credit is based on the competition principle, still managed to achieve a certain goal, Zuozi Man investigated government management.
Zuo Ziman defined on the basis of the above study, three different type of financial system. One is a capital market-based financial system. The issue of securities is a major source of funding of long-term industry, the central bank responsible for the management of monetary aggregates, prices are determined mainly by competition in the market. The Zuo Ziman think the United Kingdom and the United States belong to this type. The second is the price of the credit system of government. Banks to provide long-term funding, but the price is formed for the purpose of allocating funds set by the government through the market, The Zuo Ziman think this type in France and Japan. The third system determines the price of the financial system. Which is characterized by the pursuit of the overall target countries through market operations, Zuozi Man In such countries, Germany is very typical.
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