Wildly differing views are circulating about the future of the Asia Region Funds Passport, seen by many as the most ambitious of the three passporting initiatives in the region.

On the one hand, a business head at a European asset manager and 20-year Asia funds veteran believes ARFP is likely to fail – and he is not alone in taking that stance. On the other, Nicholas Hadow of Aberdeen Asset Management suggests it is the passport scheme that industry players in Asia are now most excited about.

The ARFP – which was signed by Australia, New Zealand, Singapore and South Korea in September 2013 – targets next year for a pilot launch for cross-border fund sales. The Philippines and Thailand have since joined the discussions.

But the business head, who asked to remain anonymous, said that while the proposed Asean and Hong Kong-China schemes will take off, ARFP faces obstacles that will scupper it.

Australia and Japan are big enough to warrant their own fund structures, he argued, and are likely to develop them in the next five to 10 years.

That would ultimately mean there is a Hong Kong-China structure, a Singapore/Asean structure, plus one each for Australia and Japan. Markets such as Korea and Taiwan are then likely to join the Hong Kong-China scheme, he said.

If there is then a discussion about merging these four into one, he noted, it would take another few years after the other four are in place.

Marc Saluzzi, chairman of the Association of the Luxembourg Funds Industry, is another to have argued that ARFP is too ambitious to succeed.

However, Hadow, Aberdeen’s Singapore-based director for business development, said: “The ARFP initiative is the big prize. It is a regional passport, involving small, big, developed and developing markets. We have small groupings going on that are positive steps, but the ARFP is the real prize in our business.”

He acknowledged that it will be a big undertaking and requires huge commitment from the participants given the differing regulatory regimes of the participating jurisdictions.

Success will also depend on the participating members, added Hadow. “What it needs is one big hitter, such as Japan. Australia is the only big player [that has expressed a desire to sign up] and I would like to see another proper Asia player.”

He said global players such as Aberdeen, which has offices and thus operational duplication in the region, could benefit from a real Asian passport scheme, in terms of greater efficiency and cost savings.