The initiative, modelled on the International Monetary Fund and mooted since the 1997-98 financial meltdown that felled emerging Asian economies, could be deployed in the event of another crisis.

'The matter is being discussed through the Asean finance ministers meeting in Singapore at present and we should receive news soon,' Mr Rais said according to state news agency Bernama.

'But we have been informed that the fund would be a reality by the time the summit is held in February,' he said.

Leaders of the 10-member Association of South-east Asian Nations (Asean) group are to meet with their dialogue partners including China, Japan and South Korea, in Bangkok on Feb 24-26.

Mr Rais said Asean secretary-general Surin Pitsuwan has been asked to help appoint a 'top-notch financial and economic adviser' to be based in Jakarta, home of the Asean secretariat.

He said that as the world faces a deep downturn, there was now the 'political will' to take action on the long-discussed Asian Monetary Fund.

'All member states have expressed their appreciation under the circumstances that we are now faced with,' he said according to the New Straits Times.

The leaders of Japan, China and South Korea last week called for quick action to set up the regional financial crisis fund, which will supercede a system of bilateral currency swaps known as the Chiang Mai Initiative.

The 10 Asean members and their three East Asian dialogue partners agreed in October to create the fund aimed at averting regional financial crises, then valuing it at US$80 billion.

Asean groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. -- AFP