March 20, 1999
Web posted at: 3:22 a.m. EST (0822 GMT)

HANOI, Vietnam (CNN) -- Asian finance ministers pushed Saturday for a review of the roles of international financial institutions and regulatory bodies, along with less reliance on credit rating agencies.

The ministers emerged from almost two days of talks Saturday to release a statement incorporating a wish list of reform for the world's financial sector.

"Given the important role credit rating agencies play in the international financial markets, there should be greater transparency in the rating process," the statement said.

Some countries in the Association of South East Asian Nations have criticized the rating agencies over their country reports, which influenced the decision of many investors to withdraw portfolio funds.

The withdrawal of portfolio funds helped drive the region into economic crisis two years ago.

The 12 points included ASEAN's view that each country was entitled to choose its own exchange rate regime and that there needed to be closer and more coordinated monitoring of short-term capital flows.

The statement welcomed recent developments such as stability in regional foreign exchange markets, healthy current account surpluses and lower interest rates.

"Notwithstanding these encouraging signs... we recognize the pace of recovery will be determined to a large extent by further progress in economic and financial restructuring," said the statement, issued after nearly two days of talks in Hanoi.

Senior officials from the International Monetary Fund and the World Bank attending the meeting have largely shared ASEAN's cautious optimism about recovery, but worry that some governments may be tempted into complacency.

ASEAN, representing a once high-flying region confronting its biggest economic challenge since its inception more than 30 years ago, comprises Brunei, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

Ministers said any recovery faced several potential hurdles, including the risk of protectionism, a sharp reversal in the U.S. stock market, further weakness in the Japanese economy and the uncertainty of external financial flows.

"We therefore urge the industrial countries to take the lead in sustaining global demand and to coordinate their macroeconomic policies, particularly to minimize excessive volatility among the major currencies," it added.

The ministers listed 12 points that comprised ASEAN's views on reform.

The 12 points included ASEAN's view that each country was entitled to choose its own exchange rate regime and that there needed to be closer and more coordinated monitoring of short-term capital flows.

The final communique also highlighted a one-year-old regional economic surveillance mechanism designed to act as an early warning system for future financial turmoil.

Ministers have said the mechanism, the ASEAN Surveillance Process, would be a key plank in warding off more financial misery.

Economists have welcomed the monitoring body, but ASEAN has yet to finalize details of the system.

ASEAN officials have yet to decide what type of macroeconomic and capital flow data would be compiled under the system. At this stage member countries will not be compelled to supply data.

Reuters contributed to this report.

Note: Pages will open in a new browser window

External sites are not endorsed by CNN Interactive.