ADB chief stresses trade, investment, labor reforms

SEOUL, May 26 (Yonhap) -- Asia-Pacific countries should push ahead with trade, investment and labor market reforms and work together to strengthen financial ties, the head of the Asian Development Bank (ADB) said Tuesday. Delivering a keynote speech at an international conference in Seoul, Takehiko Nakao said reforms and cooperation have gained urgency as the U.S. Federal Reserve is moving to raise rates as the world's largest economy is making gradual recovery. Interest rate hikes can trigger an outflow of capital from Asia to the United States that can destabilize many smaller economies. Nakao stressed the ADB has actively supported positive change in Asia and pledged it will continue to take measures to boost the soundness of the regional financial sector. The remarks come as experts taking part in the conference co-hosted by the ADB and state-run Korea Development Institute emphasized the role of regional financial institutions that are gaining prominence as a means to counter potential financial risks confronting emerging economies. Observers have said regional institutions like the Asian Bond Markets Initiative, Credit Guarantee and Investment Facility, Chiang Mai Initiative Multilateralization and the ASEAN-plus-three Macroeconomic Research Office have become safety nets that can limit risk associated financial sector fallouts, like sudden flow of capital in and out of emerging economies. yonngong@yna.co.kr (END)