taken, and are being taken, to this end. over the last number of years, it has of course been the preventive rather than the resolving mechanisms that have been more relevant. in this respect i would like to focus not so much on the various institutional adjustments of the international financial architecture, but concentrate on a subject that i deem particularly relevant, namely the development and implementation of international financial standards and codes. such tools, which set out widely accepted good principles, practices, rules and guidelines, determine the interaction between public policy and market functioning. they serve as effective mechanisms for crisis prevention and crisis containment and hence do deserve a closer look. following the asian crisis, the need to strengthen the international financial architecture was widely recognized. a major initiative was clearly the creation of the financial stability forum ( fsf ) in 1999 and its work on developing and implementing financial standards and codes. most relevant are the 12 standards that the fsf has designated as key to strengthening and preserving the soundness of financial systems and that cover a broad range of subject areas. these standards pertain to macroeconomic policy and transparency, institutional and market infrastructure as well as financial regulation and supervision. as far as creation and implementation of these standards is concerned, many international institutions and fora have been involved, including the g20, the basel - based committees, the financial action task force on money laundering and the international financial institutions. the progress that has been made over the last number of years is truly impressive. for example, as of today, three quarters of the fund membership has completed more than 840 modules of the imf ’ s reports on the observance of standards and codes, the so - called roscs. moreover, more than a third of the imf ’ s member countries subscribe to its special standard for dissemination of economic and financial data, the sdds. finally, more than 60 percent of the fund membership has so far completed a financial sector assessment programme ( fsap ). that said, further improvements should be sought in respect of participation rates, including also as regards the reporting to the imf on the currency composition of countries ’ foreign exchange reserves. why does the implementation of internationally agreed standards and codes play such an important role when it comes to the prevention of financial crises? there are a number of benefits that bear emphasis. at the national level, these tools do not only help anchor market expectations as they make more predictable future macroeconomic and financial policy measures. they also make institutions, markets

speeches published date : 26 may 2021 " the quest for an integrated macro policy framework " - opening remarks by mr ravi menon, managing director, monetary authority of singapore, at asian monetary policy forum and mas - bis conference on macro - financial stability on 26 may 2021 mr agustin carstens, general manager, bank for international settlements, ladies and gentlemen, good a ernoon and welcome to this year ’ s special edition of the asian monetary policy forum featuring the mas - bis conference on macro - financial stability. macro - financial stability : theory trying to catch up with practice the origins of this conference go back to a conversation that agustin and i had about 18 months ago on the need to crystallise a coherent policy framework for macro - financial stability. for the three decades preceding the global financial crisis, the traditional inflation targeting framework for monetary policy has served most economies well, delivering price stability as a basis for sustained economic growth. that framework is now coming under strain. emerging market economies ( “ emes ” ) faced with large and volatile international flows of capital have had to resort to a variety of policy tools besides traditional monetary policy to achieve both macro - economic and macro - financial stability. the advanced economies faced with rising leverage and growth in financial assets against the backdrop of extremely low interest rates are also looking at macroprudential measures to promote financial stability. practice has moved ahead of theory. in the absence of a conceptual framework, eme central banks facing large capital flows have had to experiment with the tools at their disposal – such as foreign exchange intervention, macroprudential policies, and capital flow management measures. there is now a rich body of policy experiences, especially in emerging asia, crying for a theoretical framework. we need a framework that provides coherence not only across these various policy tools but also with traditional monetary and fiscal policies. there is an active research agenda at the bis on such an integrated policy framework. as a practitioner of some of these policies, mas is delighted and honoured to organise this conference together with the bis. what is the big deal with capital flows? when central bankers from advanced economies meet, they discuss quantitative easing and r - star ( the natural rate of interest ). when eme central bankers meet, they talk about capital flows. what ’ s the big deal with capital flows? first, capital flows to emes have become quite large. annual gross portfolio inflows have grown to an average 1. 3 % of emes ’ gdp in the eight years following