1.3  Transparency and enhanced surveillance  The efficiency of international capital markets depends on the availability of reliable and timely information both on debtor countries and market participants. –  As regards the public sector, many efforts have been achieved, such as the IMF codes of good practices on transparency in the field of fiscal policy or monetary and financial policies or the promotion by the IMF of statistical standards (the so-called SDDS). –  International Financial Institutions have also continued to proceed toward greater transparency. Several initiatives have been launched, I will particularly point out the participation of 60 countries on a voluntary basis in the pilot experience for the release of IMF article IV reports. –  As far as the private sector is concerned, parallel efforts need to be pursued. Progress may take the form of improved disclosure on a voluntary basis, more demanding statistical reporting and extended requirements for non-transparent segments of the financial markets. Thanks to improved transparency important progress is being made to strengthen IFI’s surveillance in key areas, including financial sector issues, external debt and capital account developments, exchange rate policies. As Prime Minister Fraser has mentioned, the definition of internationally agreed standards and codes is also strongly impacting the IMF surveillance; the implementation of these standards will reduce emerging market economies’ financial vulnerabilities and together with enhanced transparency, improve market discipline and market participants’ ability to better assess the risks of their investment decisions.

FDI), in line with the progress mode in the financial sector solidity and soundness; recent crises illustrated disruptive capital outflows generated by external debts highly concentrated on short-term maturities. 1.2  Improved reserve and debt management  To mitigate the volatility of capital flows and especially short term flows and reap the benefits of capital account liberalization, one should adopt a risk management strategy that involves a system for monitoring and assessing the risks and liquidity of the economy as a whole, including at a sectoral level. The international community may assist in developing best practices related to reserve and debt management: let me quote for example the more stringent publishing obligations on net foreign exchange reserves adopted within the context of the IMF Special Data Dissemination Standard (SDDS) or the IMF and the World Bank initiative to promote good practices in reserve and sovereign liability management. As recommended by the Financial Stability Forum Working Group on Capital Flows, an improved risk management by the banking sector is desirable, particularly as regards banks in emerging markets receiving flows and international banks extending cross-border credit, with the help of revised Guidelines from the Basel Committee on managing liquidity risk. Let me also note that implementing a strategy assessing the liquidity risk and foreign exposure of the economy as a whole calls for an adequate balance sheet information from both the public and the private financial and corporate sectors.