both medium - term global rebalancing and short - term policy accommodation. economies that are being affected by high commodity prices, particularly lowincome countries ( lics ), should strive to develop targeted policies to the most vulnerable groups through efficient cash transfers, instead of across - the - board subsidies. the international community should strive to support these efforts through similar measures, as demand subsidies or export constraints in non - lic economies exacerbate commodity price pressures. policy advice by the fund should be tailored to these different groups of economies. policy recommendations that are appropriate for some economies are not necessarily suitable for other economies. one salient theme, however, is that fiscal policy space is more limited across the spectrum than it was in the run up to the 2008 – 2009 financial crisis. moving from broad policy recommendations to concrete messages on policy implementation is required to draw the policy - makers ’ attention and establish a constructive dialogue. the consolidated multilateral surveillance report is a positive step in that direction. ii. the medium - term challenges and the fund ’ s action plan under the current circumstances, the fund should focus on its short - term policy challenges. indeed, one of the main issues that the fund is tackling right now, namely the triennial surveillance review, will be shaped directly by the lessons that the practice and traction of surveillance reveal in the current uncertain environment. such surveillance practices will be the basis on which to revamp the surveillance framework, for instance, through an integrated surveillance decision that encompasses both its bilateral and multilateral aspects. the fund ’ s resource adequacy is, in our view, directly linked to the functioning of regional financial arrangements ( rfa ) and the existence of bilateral central bank swap lines. it is welcome that major central banks are currently cooperating in this area. a reasonable bis central bankers ’ speeches question is whether current fund resources, plus those available through rfas and bilateral swap lines, are sufficient to deal with a significant major financial dislocation. assessing these resource needs is critical to evaluate whether, for instance, the new arrangements to borrow will have to remain active, even if the quota increase is fully implemented by next year. moreover, the discussion of resources would have to be linked to a broader rethinking of the need for alternative lending instruments to bolster the global safety net. this topic should be given higher priority at the current juncture and not, as in our previous imfc meeting, simply as part of a broader agenda for

ims reform. the activation and deactivation, and the criteria for conditionality, for the flexible credit line or similar instruments could be reviewed, towards making them closer substitutes to bilateral swap lines that have been implemented by major central banks. this would help reduce the stigma associated with the fund ’ s toolkit, and would contribute to ensure adequate liquidity provision in times of market stress. bis central bankers ’ speeches