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More cooperation in the financial space

COOPERATION between the Philippines and Singapore is set to increase as the two countries work towards an agreement to open up the banking industry as part of efforts aimed at greater financial integration and economic development among Asean member countries.

Former Philippines central bank Bangko Sentral ng Pilipinas (BSP) governor Amando Tetangco Jr was reported as saying that while the Philippines has already entered into various agreements with Malaysia, Thailand, and Indonesia on the Asean Banking Integration Framework (ABIF), it still has yet to sign an agreement with the Monetary Authority of Singapore (MAS).

"We have not started yet with Singapore. But it might happen soon, maybe over the next few months. We have to touch base with the MAS," Mr Tetangco, who was succeeded by incoming BSP governor Nestor Espenilla Jr, said in June.

A letter of intent (LOI) has been signed with Indonesia's Financial Services Authority in Jakarta to work out a bilateral agreement on the establishment of qualified Asean banks between the two countries under the ABIF.

Meanwhile, a Declaration of Conclusion of Negotiations with Bank Negara Malaysia and a LOI with the Bank of Thailand was signed on the sidelines of the 3rd Asean Finance Ministers' and Central Bank Governors' joint meeting in Mactan, Cebu earlier this year.

Under the ABIF timeline, each Asean-5 member, which consists of Indonesia, Malaysia, Philippines, Singapore and Thailand, should conclude at least one bilateral agreement with another Asean-5 country by 2018.

And by 2020, the framework has a target of conclusion or near conclusion of at least one bilateral agreement for each of the 10 Asean members as part of the integration under the Asean Economic Community.

Other areas of potential cooperation in the financial sector include fintech, where Singapore has a relatively better track record with startups while the Philippines has a target of reaching 1,000 startups in this space by next year.