Next steps to deliver meaningful change  Due to strong interdependencies between the building blocks, the most significant enhancements will arise if over time all building blocks are advanced and implemented in a coordinated way, and appropriate monitoring and governance will be needed to ensure that this work progresses. The Stage 3 roadmap for change has set out the goals, actions, milestones and actors needed to deliver the building blocks. While all actions for 2021 are committed deliverables, those beyond 2021 are necessarily more indicative to allow for adjustment in response to new information and developments. The roadmap also acknowledges that  9  https://www.bankofengland.co.uk/bank-overground/2020/legal-entity-identifiers-the-code-to-a-digital-economy Bank of England, 12 March 2020, ‘Central Bank Digital Currency: opportunities, challenges and design’. https://www.bankofengland.co.uk/paper/2020/central-bank-digital-currency-opportunities-challenges-and-design-discussion-paper  10  7  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  7  different countries might need to introduce the building blocks at different times, reflecting different starting points and legislative frameworks. The involvement of the private sector, sharing their insights and practical expertise, as well as delivering change, will be key to support the practical implementation of the roadmap. I believe that the timelines and actions in the roadmap and the fact that the pace of this work has been maintained during what has been an unprecedented year for us all, underlines the importance and urgency placed on improving cross-border payments.

On the other hand, tighter financial linkages imply large and swift transmission of shocks across countries, particularly through a large expansion in gross capital flows with an increased volatility of those flows and exchange rates. The challenges we face in Thailand to large extent also apply to emerging markets as a group. The massive equities and bonds sell-offs in emerging markets during the taper tantrum episode in 2013 were vivid examples of “financial spillovers”. There is no doubt that the benefits of integration into global economic and financial markets outweigh their costs. Therefore, the relevant question is thus how countries should respond to increased capital flows volatility. This year, we gather here at an important juncture of what seems to be yet another shift in global economic and financial landscape. This may create a challenging environment for small open economies to conduct policy, particularly capital flows and exchange rate policy. Given recent economic and financial development, it is clear that the main drivers of ensuing volatility in capital flows and exchange rates are threefold. First, policy divergences among advanced economies appear to be on course recently. While the US is expected to raise its policy rate, likely by the end of this year, recovery of the euro area economies and Japan remains unsteady, with ultra-loose monetary policies put in place for a longer period. Second, uncertainties surrounding Greece’s bailout program have rendered great shifts in market players’ risk on and off sentiments. Third, growth momentum and prospects in China and some other emerging markets are deteriorating.