Although not part of the baseline scenario, we cannot rule out a worsening of global economic and financial conditions. Overall, the tensions in Europe are  BIS Review 99/2010  5  something we had commented in several previous presentations and were related not only with the need to put forward expansionary policies to avert further deterioration of output in the face of the global crisis, but also with the gradual and orderly withdrawal of fiscal and monetary policy stimulus packages in the world. What prevented the financial collapse of late 2008 from becoming a second Great Depression were the strong fiscal and monetary stimulus packages around the world. Larger fiscal deficits are the outcome of increased expenditure and reduced taxes, in addition to a normal deterioration associated with a recessive period. Chile was able to make an unprecedented effort thanks to its solid financial situation and sound macroeconomic policies: the exchange rate adjusted without triggering larger imbalances; the inflation targeting scheme was consistent with a drastic and significant change of sign the monetary policy stance and the conduct of public finances managed to implement a highly countercyclical fiscal package that used part of accumulated savings from previous years. However, not all the economies were in the same position when the crisis hit. The situation has been particularly complex for those countries that started this process with fragile fiscal situations, that is, with high levels of public debt. Furthermore, in Europe, the existence of a common currency has introduced an extra constraint to the adjustment process.

Individuals and businesses must be able to digitally access all their relevant data and make them available to third party service providers who can then serve these individuals and business in a holistic manner. This could be for purposes of financial planning, trade financing, credit scoring, etc. where data aggregation is important for more customised and comprehensive solutioning. When these foundational digital infrastructures come together, they will have the power to deliver truly end-to-end digital transactions. Take for example, cross-border digital payments. With the four foundational digital infrastructures working in concert, we can effectively tackle the big pain points in know-your-customer checks, sanctions screening, and exchange of documents, to enable cheaper, faster and secure payments. Singapore has implemented these four foundational digital infrastructures. Singaporeans can use their national digital identity – SingPass Mobile – to transact digitally with both the government and the private sector Using SingPass Mobile, Singaporeans can make available relevant verified information to allow banks to onboard them without the need for paper documentation or physical presence. Singapore’s retail payments infrastructure – FAST and PayNow – has made digital payments interoperable. Singaporeans can now move money to one another’s bank accounts in real-time and at zero cost, with just three clicks on their mobile phones, regardless of which bank app they use. The Singapore Financial Data Exchange – SGFinDex – is a pioneering data exchange platform, the first of its kind in the world.