Vietnam Joins Hands with Neighboring Nations for Smoother Cross-Border Payments

In a heartening move, Vietnam’s central bank enthusiastically embraced an agreement on Friday, becoming an integral part of a collaborative endeavor involving five other vibrant Southeast Asian nations. This effort is all about establishing seamless cross-border payment mechanisms that foster stronger connections between these countries.

With Vietnam’s entry, a powerful coalition forms, including Indonesia, Malaysia, Thailand, the Philippines, and Singapore. Together, they are committed to weaving a web of interconnectivity by harmonizing their respective payment systems. What’s truly exciting is the adoption of the QR (quick response) code system for everyday retail transactions, making monetary interactions swift and straightforward.

This exciting agreement was hatched during a gathering of ASEAN’s 10-member community, where finance ministers and central bank governors came together in Jakarta. But that’s not all – Indonesia, Malaysia, and Thailand have set their sights on another vital phase, aiming to facilitate cross-border transactions involving financial assets such as equities and government bonds, all denominated in local currencies.

Bank Indonesia governor Perry Warjiyo shared his optimism during a press conference, noting, “Our objectives stretch beyond just simplifying trade and investment. We’re also bolstering our collective resilience against the unpredictable shifts in exchange rates and the global influence of institutions like the Fed.”

Indonesia has already taken strides in this direction, successfully linking its payment system with Thailand and Malaysia using QR codes. The next target on their radar is Singapore, with plans to establish this connection later in the year. With ASEAN encompassing over 600 million individuals, this collaborative effort is a significant step forward, aiming to integrate economies collectively valued at a staggering $2.3 trillion. The long-held vision of economic integration, enriched through harmonized standards, customs procedures, and increased market connectivity, is now gaining momentum after years of anticipation.

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