while the global community continues to debate and explore possible solutions to manage spillovers and spillbacks of policies in advanced economies, for emerging economies, there is a need not just to preserve existing tools available to us, but to constantly refresh our policy toolkit to deal with the multifaceted risks confronting our economies and to be flexible in implementing them. pragmatism is key. policy configuration will need to be pragmatic and premised on the risk that is being managed. indeed, macroprudential policies have been found to be effective in managing financial cycles and associated risks, such as excessive credit growth and asset price inflation. nevertheless, sizeable shifts in capital flows could cause disorderly financial market conditions and excessive exchange rate movements. in pursuit of preserving stability, policymakers must therefore be able to avail ourselves to a broad range of policy toolkit. globalisation of human capital lastly, i will briefly touch on what globalisation means for the average person in today ’ s economy. being skilled alone is no longer a guarantee of employment. with offshoring of jobs, workers are now competing in a fluid workplace, against a global workforce. a job that is available locally today can be effortlessly transferred to a different country tomorrow. essentially, the increasingly dynamic nature of work underscores the importance for workers to constantly adapt, re - skill and up - skill. a global workforce also means that borders no longer limit the search for preferred jobs. in fact, globally, 258 million people, almost the size of indonesia ’ s entire population, are living in a country that is not of their origin. another aspect is the intensification of globalisation of information. technology has brought the world into the palm of our hands. last year, 3 in every 4 persons were active on a social media platform. in fact, if facebook were a country, with 1. 5 billion active users, it would be the largest country in the world today. in the span of a decade, social media has become a bona fide global marketplace, marketing tool, recruitment platform and social scene. all this points to the double - edged nature of globalisation : while it may have brought people closer together, it also introduces the challenge of promoting greater appreciation of cultural, ideological and sociopolitical diversity. conclusion globalisation, once envisioned to be a beacon of unity, has fueled increasing polarisation in recent years. let ’ s remind ourselves that in this globalised world, it is important for the contented

- how transfers, with the intended benefits. however, financial globalisation has also been accompanied by highly - volatile short term portfolio flows, which frequently led to major disruptions to emerging economies ’ financial markets. at the extreme, global financial flows can lead to the build - up of domestic vulnerabilities, such as currency mismatches, external indebtedness and broader financial imbalances. when financial globalisation becomes in itself a source of shock, financial markets can be easily overwhelmed. in malaysia, two - way capital flows have increased by almost three - fold in the aftermath of the global financial crisis. similar to other emerging economies, we have also experienced several episodes of sharp capital flow reversals. supported by firm macroeconomic fundamentals, our deep and broad financial markets were able to intermediate these flows in an orderly manner. the experience of emerging economies in dealing with capital flow volatility underscores the need to always keep our “ own house in order ”. while this is necessary, it is not sufficient. often, we have seen how external developments that are beyond our control, such as the taper tantrum and trade tensions, could trigger periods of sharp capital flow volatility in emerging economies with severe consequences. there are “ innocent bystanders ”. it is therefore imperative that the risks arising from financial openness be better managed. similar to legitimate concerns on trade openness, emerging economies also have legitimate concerns on the negative effects of financial globalisation. more needs to be done to have, to quote imf ’ s christine lagarde, “ safer capital flows ”. allow me to put forward two areas for deliberation. first is on financial safety nets. in this regard, i welcome efforts to strengthen regional and global financial safety nets. to this end, asean + 3 2 / 4 bis central bankers'speeches countries achieved a significant milestone under the chiang mai initiative multilateralisation when the fund size was doubled to usd240 billion in 2014. moving forward, an important consideration is to bring the various bilateral swap arrangements and regional financial safety nets together with the imf ’ s safety net into a coherent framework that will enhance their complementarities and thus, effectiveness in supporting emerging economies in dealing with short term capital flow volatility. second is with respect to domestic policy space for emerging economies in dealing with capital flows. clearly, capital flow volatility poses considerable challenges to emerging economies ’ policymakers in safeguarding financial and macroeconomic stability.