The asian dollar market

The Asian Dollar Market functions as a regional center for Eurodollars in Asia-Pacific. From its establishment in 1968, it mobilized the surplus US dollars in the region and then served the demand for capital from developing countries and national and multinational corporations in Asia. As a result, Singapore emerged as an international financial center. This chapter introduces the history of the Asian Dollar Market and analyzes factors behind the success of Singapore. It sees the emergence of Asian dollars from the hybridization of the following elements: the colonial experience of Singapore as an entrepôt for Southeast Asia under the British Empire, the independence of Singapore and the making of a nation-state with an international financial center, and the role of foreign bankers who brought the idea of the Asian Dollar Market. It pays attention to the deliberate efforts by the government of Singapore, particularly the Monetary Authority of Singapore, as a host agent to invite foreign banks and Eurodollars in Asia. The authority continuously and incrementally lifted regulations concerning foreign exchanges and introduced tax structure favorable to international capital. Then this chapter examines the evolution of the Asian Dollar Market - the Asian Bond Market - and the negotiable certificate of deposits denominated in Asian dollars. It concludes with the impact of the Asian Dollar Market on the economy of Singapore and the Asia-Pacific region and the market’s importance in the history of international finance of the twentieth century.