BOAO, China (Reuters) – China’s central bank will continue to promote currency swaps and strengthen monetary cooperation with Asian economies to maintain regional financial stability, the bank’s governor said on Wednesday.
Bilateral currency swaps can facilitate trade and investment and are a useful addition to the global financial safety net, Governor Pan Gongsheng said at the annual meeting of the Boao Forum for Asia.
“Bilateral currency swaps can provide emergency liquidity support in times of turbulence in international financial markets and banking crises in some countries,” he said.
According to Pan, the central bank has signed bilateral local currency swap agreements with central banks and monetary authorities of 29 countries and regions, with a total amount of about 4 trillion yuan ($553.49 billion).
Asian countries should also promote the International Monetary Fund’s (IMF) quota and voting rights reform to improve the treatment of emerging markets, Pan said.
“China’s bilateral currency exchanges with selected countries also formed an important part of the international rescue aid package led by the International Monetary Fund,” Pan added.
Argentina had planned to draw on several billion dollars in disbursements from the IMF to repay China some of the money it borrowed through a currency swap line, Reuters reported last year.
($1 = 7.2269)