and codes ; the financial stability forum identified 12 out of them as key for the international financial stability and suggested incentives to implement them. the implementation of these standards is in the self interest of all partners in the process of economic and financial globalisation. the commitment of countries to implement codes and standards is likely to be reinforced if market participants actually reflect information on observance of codes and standards in differentiated credit ratings. 1. 1. 2 · international financial institutions have also continued to proceed toward greater transparency, in particular the participation of 60 countries on a voluntary basis in the pilot initiative for the release of imf article iv reports. · as regards the private sector, progress may take the form of voluntary improved disclosure, more demanding statistical reporting and extended requirements for nontransparent segments of the financial markets. prevention also lays on sound economic conditions. a sound macro - economic framework and appropriate macro - economic policies are essential as they condition the resilience of any economy to external shocks. three issues are worth being addressed in that respect : - as far as the choice of an exchange rate regime is concerned, the sustainability of any regime depends crucially on its consistency with a country ’ s domestic macroeconomic and structural policy framework. as a consequence, the so called “ corner solutions ” are not necessarily the only available options ; “ intermediate solutions ” remain relevant options, particularly for open economies with close links to a partner country ( or a single currency area ) that maintains price stability, or for countries experiencing high inflation anchoring the currency provides a simple and credible rule for monetary policy ; in that regard, intermediate solutions might be particularly appropriate for countries which apply to join the european union. - the soundness of domestic financial systems is a core element in the ability of an economy to resist external shocks ; furthermore, it is clear that weaknesses in the financial system can lead to financial instability and therefore trigger capital outflows, as experienced in the context of recent financial crises. as a consequence, emerging market economies should establish an appropriate institutional, supervisory and regulatory framework, building on international standards, such as the core principles for effective banking supervision issued by the basle committee on banking supervision. - the implementation of sound macro - economic policies is also key as regards crisis prevention. in that respect, let me just say a few words on 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

french franc and in the creditworthiness of france in connection with the policies set forth by the president of the republic and the government for the reduction of government deficits, the stability of the franc and monetary union in 1999. in 1996, the banque de france's repurchase tender rate was cut from 4. 45 % to 3. 2 % today. it is one of the lowest rates in the g7 countries in both nominal and real terms. the five - to - ten - day repo rate fell from 5. 85 % to 4. 75 %. short - term market rates eased substantially, with three - month rates shedding almost 400 basis points since october 1995 and currently standing at around 3. 4 %. the easing in short - term rates went hand in hand with a significant decline in long - term rates, which are the reference for a large share of lending to the private sector. ten - year rates have fallen by more than 100 basis points since october 1995. thanks to the credibility of every component of its economic policy, france today enjoys the lowest medium - and long - term market rates in the european union, and the third lowest rates in the world, bettered only by japan and switzerland. this brings me to the monetary policy decisions for 1997. 1. the ultimate goal of monetary policy is to ensure price stability, as required by legislation. the objective of the monetary policy council is that the increase in prices, as measured by the consumer price index, should not exceed 2 % in 1997. as in the medium term. 2. to meet this ultimate goal, the banque de france uses two intermediate objectives, one of which is external and the other internal : - the objective of a stable external value of the currency : as it has been for ten years, the stability of the franc will be maintained against the group of the most credible currencies in the european exchange rate mechanism. - an intermediate internal growth target for the money supply assessed by the development of the narrow and broad monetary aggregates : in 1997, the money supply should be able to show a medium - term growth trend of 5 %. this figure is consistent with price inflation of no more than 2 % and non - inflationary real gdp growth of about 2. 5 %, which could be exceeded, in view of the potential for growth to catch up in the medium term. the monetary policy council has decided to simultaneously monitor the main narrow and broad money aggregates in order