BANGKOK Dec 23 The central banks of Thailand,
Indonesia and Malaysia agreed on Friday to promote use of their
currencies for trade and investment among the three nations, the
latest move by emerging economies to reduce exposure to volatile
The Bank of Thailand and Bank Negara Malaysia each signed a
memorandum of understanding with Bank Indonesia on a "framework
of cooperation" to promote settlement of bilateral trade and
direct investment in their local currencies.
"The enabling environment will benefit businesses by
reducing transaction costs and enhancing efficiency of trade and
investment settlements," the three central banks said in a
"Amidst the current volatile global financial market
conditions, this will offer businesses more options in choosing
currencies for trade settlement," it said.
The banks said the agreements will pave the way for wider
usage of local currencies in the ASEAN Economic Community and
spur development of regional foreign exchange and money markets,
supporting wider economic and financial integration.
The Thai and Malaysian central banks this year implemented a
similar arrangement they signed in August 2015.
Many emerging economies face increasingly volatile financial
markets and rising trade protectionism as well as capital
outflows in the wake of rising U.S. interest rates.
(Reporting by Orathai Sriring; Editing by Richard Borsuk)