Asian Exchanges

The University of Hawaii's Asia-Pacific financial markets research center is a wealth of information

March, 2003

There is a resource for data on Asian markets and companies of which not many Hawaii businesses are aware. At the University of Hawaii’s Asia-Pacific Financial Markets (FIMA) Research Center, the PACAP Databases Program (in partnership with the University of Rhode Island) maintains data on the capital market’s publicly traded companies of 10 countries in the region.

“Right under their nose they have a tremendous resource of information on Asian financial markets and Asian companies, so they can contact us and take advantage of what the University of Hawaii can offer,” says S. Ghon Rhee, K. J. Luke Distinguished Professor of International Finance and a banking and co-executive director for FIMA.

FIMA doesn’t just maintain data on Asian financial markets; it helps to generate it through partnerships with some of the countries’ major stock exchanges and central banks. It was the brainchild of Rhee, a native of South Korea, and his wife and FIMA co-executive director, Rosita Chang, a native of Taiwan.

Chang says that back in the 1980s, when everyone was talking about how miraculous the Asian nations’ economies were, she and Rhee found a dearth of information on the region’s financial markets. In 1988, through contacts in South Korea and Taiwan, they started putting data into a system called PACAP at the University of Rhode Island, where both were working at the time. Other Asian countries soon followed.

“After that, we know that the Wharton School at the University of Pennsylvania and UC Berkley wanted to get in, but they can’t because [partners in the Asian countries] had agreements with us,” says Chang. “So the Tokyo Stock Exchange told Wharton, ‘We can’t. We have already contracted with PACAP.’”

The database spawned many other initiatives. Research based on the market data created the need for conferences. In 1993, the Pacific-Basin Finance Journal started publishing as another venue to share that research.

Rhee and Chang found the East Coast mindset to be very Western-oriented, in spite of the groundbreaking academic and policy research they were generating. “When we were in Rhode Island, everybody kept on asking us, ‘Why do we have to study Asia?’ It was a different kind of environment,” Rhee says. He was serving as a scholar at the Asian Development Bank while on a two-year sabbatical from the University of Rhode Island when someone threw his hat into the ring for the K. J. Luke chairmanship at the UH.

Says Rhee, “Our University [of Hawaii] mandate is whatever we do, we must focus on Asia. That’s the attraction for us, because our research activities focus on Asia.” All of Rhee’s and Chang’s projects and research moved over to UH with them, with the exception of the FIMA database, which is now a partnership between University of Rhode Island and the UH, with the UH serving as the “front office.” Rhee says that more than 100 research and educational institutions subscribe to the database, generating about $300,000 in gross revenue a year.

He says most of the revenue gets plowed back into the program to maintain the database, but he feels it’s important to also use the money to support graduate students and their research. That’s why he has put together a master’s of science in Asian finance program at the UH. If the proposed program is approved, it will be launched in September 2004.

FIMA has developed a strategic partnership with one local business, Kamakura Corp., a developer of risk-management software for financial institutions.

Kamakura Corp. chief executive officer Don van Deventer says, “I think Hawaii as a center for finance, financial services and financial research makes a lot of sense, and [Rhee and Chang] are just proof that it’s working.”

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Kelli Abe Trifonovitch