avoid macroeconomic imbalances and unsustainable fiscal policies. this all underlines the responsibility of national economic policy - makers. stability begins at home. strong economic adjustment mechanisms not only help to absorb adverse shocks, but they are also essential to reap the benefits of the euro. the latvian experience shows that adjusting to major adverse shocks and reducing large macroeconomic imbalances is not impossible. using a combination of fiscal and nominal wage adjustment, structural reforms and measures to preserve financial stability, as well as international support, latvia has been able to lay the foundations for its economy to stabilise and recover, although important challenges remain and the policy agenda remains unfinished. what matters is a broad political consensus, and a broad consensus in society, about the need for adjustment and the correction of past behaviour. i wish latvia all the best in its efforts in this regard. thank you for your attention. bis central bankers ’ speeches

this is to not only effectively channel these funds into productive investment opportunities in the region, but also to finance the massive development of infrastructure required by the region. as part of the increased regional financial integration, there is now increased regional presence and participation in the domestic financial systems of the region. this phenomenon has been supported by the progressive financial liberalisation, the development of domestic financial markets, the greater use of domestic currency to facilitate bilateral trade activities and the development of the payments and settlement systems. the economic and financial regional integration has also been reinforced by a higher level of regional cooperation. earlier regional cooperation had focused mainly on trade, investment and development. this decade has seen the cooperation shift to efforts to address financial stability issues, including in surveillance, crisis management, liquidity support arrangements, financial supervision and financial market development. the approach in forging greater financial integration in asia will be different from that adopted by europe. the region does not have centralised institutions to coordinate financial integration but has leveraged on the existing intra - regional groupings and networks to forge greater cooperation and collaboration in areas of common interest. the region has its own monetary and financial stability committee that is supported by arrangements for regional surveillance to identify risks and vulnerabilities to the region. also in place is an integrated crisis management framework that will be operationalised in the event of an imminent financial crisis in the region. recently the region successfully organised two schemes for reserve pooling, the asian bond fund and the asean + 3 chiang mai multilateralised swap arrangement as a liquidity support facility. as economic and financial systems in asia continue to transform and as the region becomes more integrated and cohesive, this has not only enhanced the potential for the region to contribute to global growth but also enhanced the resilience of the region and thus its role in contributing to global financial stability. these trends support the global efforts by the various international groupings and multilateral agencies in the search for solutions to achieve global financial stability and sustainable growth. the transition from g7 to g20 is recognised as a positive step forward that extends its reach beyond the developed world. but the representation in g20 is by virtue of the size of the economy and not by representation of specific groups of countries. its outreach and inclusiveness is therefore limited, and small and medium sized emerging economies are not part of this process. the g20 is, nevertheless, an important global forum for considering global issues and will have an important role in setting the direction for global policies. earlier,