Chiang Mai Initiative amended to up access ceiling

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Chiang Mai Initiative amended to up access ceiling

Amendments to the Chiang Mai Initiative Multilateralization, a multilateral currency swaps agreement involving Asean countries, Korea, China and Japan, went into effect on Wednesday, according to the Bank of Korea.
Key features of the amendment include raising the International Monetary Fund de-linked portion from 30 percent to 40 percent. The increase in the de-linked portion means the 13 countries using the $240 billion regional swap facility can access up to 40 percent of their maximum borrowing amount from the facility when there is no matching IMF-supported program.
The change makes the multilateral swap facility "more readily available to the countries in need," the central bank said in statement.
Another change is institutionalizing the use of local currencies, in addition to the dollar, when financing from the swap facility on a voluntary and demand-driven basis.
The multilateral regional swap deal was established in March 2010. Korea has access to $38.4 billion from the facility.
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