Japan and Indonesia have started negotiations on a bilateral currency swap agreement as part of an initiative among Asian nations to promote financial stability in the region, an international financial source said Tuesday.
Officials from the two countries held the first round of negotiations in Jakarta last Wednesday and Thursday in the hope of wrapping up the talks at an early date.
Tokyo and Jakarta began the negotiations under the so-called Chiang Mai Initiative, which is designed to create a network of bilateral currency swap accords among the 10-member Association of Southeast Asian Nations plus Japan, China and South Korea.
The planned network is aimed at bolstering East Asian nations' defenses against the kind of borrowing that led to the Asian financial crisis of 1997 and 1998.