Accelerating Development of Asian Bond Markets (Outline)
December 14, 2010
Keidanren

Local Businesses

Interregional and Local Infrastructure Development
Stable supply of medium- tolong-term capital

Acceleration

Creation of Functional Asian Bond Markets

Fostering Institutional Investors and Market
Authorities
1. Fostering Institutional Investors
PresentBoth private financial institutions and central banks ofAsian markets foster institutional investors through theAsian Bond Fund (ABF). Bond markets should beimproved to be easily accessible to institutional
investors.
Recommended measures
 The private sector should promote the technicalassistance to institutional investors in investment in
Asian bond markets and the development of new
financial instruments.
 Asian governments should address climate
development for institutional investors, including thedevelopment of swap markets and secondary
2. Training for Financial Authorities, Exchange
Officials and Market Players
Present
Human resource training is provided by Japan’s Ministryof Finance and Financial Services Agency, and by theBank of Japan, Japan International Cooperation Agency(JICA), Tokyo Stock Exchange, and so on so forth.
Recommended measures
 The private sector should support the training ofhuman resources with practical skills in the field ofcapital markets.

Acceleration

Developing Market Infrastructure
3. Supporting Development of Asian Local Rating Agencies That Have
Expertise in Evaluating Local Companies
PresentThe Association of Credit Rating Agencies in Asia (ACRAA) improves thecapacity of member rating agencies and enhances information intermediaryfunctions through ratings.
Recommended measures
 ACRAA should promote the standardization of rating practices in Asia andefforts to raise the reliability of ratings by local agencies.
 The private sector should foster local rating agencies.

4. Promoting the Asian Bond Markets Initiative (ABMI)
PresentThe ASEAN+3 Finance Minister's Meeting, with ABMI, has been taking steps todevelop regional bond markets since 2003. In 2010, the Credit Guarantee andInvestment Facility (CGIF), which is a regional guarantee organization, and theASEAN+3 Bond Market Forum (ABMF), which is a forum for dialogue among
government officials and the private sector, were established.
Recommended measures(1) Expanding credit guarantee systems for bond issues Japan Bank for International Cooperation (JBIC) should support CGIF tointroduce simple procedures at low cost.
(2) Promoting efforts for deregulation and harmonization of market rules
 The ABMF should relax and harmonize regulations and promote market
infrastructure development consistently by making a roadmap.
 Japan’s government and private sector should jointly take the initiative in theABMF.

 Tokyo market functions as a market for issuer's capital procurement Tokyo market should be a model for Asian bond markets
5. Boosting Active Use of Japan’s Bond Markets
PresentIn April 2010, JBIC launched its guarantee facility for the issue of samurai bonds. In thespring of 2011, there is a plan to launch a new bond market in Japan for professional
investors. Challenges remain, especially the limited acceptance of English-language indisclosure documents and the lack of enough financial specialists.
Recommended measures
 The Japanese government should promote the training of financial specialists andthe deregulation of bond markets for foreign participants, such as permitting the useof English-language in the disclosure documents required to issue new bonds.
(1) Boosting the use of samurai bond markets
 The Japanese government should promote the relaxation of regulations andsimplified procedures for bond issuance.
 JBIC should further strengthen its facilitation function for samurai bond issuance.
(2) Boosting the use of bond markets for professional investors
 The Japanese government should introduce low cost and simplified procedures inthe bond market for professional investors.

6. Utilizing Private-sector Funds for theInterregional and Local Infrastructure
Development
PresentThe private sector establishes funds forinfrastructure. The reduction of accompanied
risks is required.
Recommended measures
 The private sector should develop
attractive infrastructure funds that support
Japan's packaged infrastructuraldevelopment projects abroad.
 JBIC and Nippon Export and Investment
Insurance (NEXI) should consider
reducing insurance costs and relaxing theconditions for use of the insurance.