new credit and hence delay economic recovery. • the risks of inadequate transparency. lack of transparency, both in the public and private sectors, can exacerbate financial distress by reducing the scope for market disciplines to operate and by weakening the ability of creditors and investors to make informed decisions. in some cases, herd behaviour and resultant over - selling of currencies can be attributed in part to inadequate transparency. what, then, can be done to address these problems and restore the global economy to sound health? before setting out some specific thoughts, i think a number of general points are worth mentioning : • first, we should not pretend that risks can be eliminated or that we can create a world where financial distress does not occur. there will always be periods of financial distress. no policy framework at national or international levels, will entirely eliminate these risks. and nor should we seek to do so. for we need to remind ourselves that there is always a trade - off between risk and return. if we seek to eliminate risks, not only will we be bound to fail, but we will also risk undermining the prospects for strong and sustainable economic growth. and, within reason, a degree of financial distress need not necessarily be a bad thing. the most we can hope to achieve is to reduce the risks and severity of economic distress in the future, and to create a resilience within economic structures to facilitate orderly recoveries from periods of distress. • second, we need to accept that modem economies are inherently complex and that there are no magic solutions. we need to be realistic as to what can be achieved. in that regard, i believe the best solutions will not lie in grand designs, but rather will be relatively modest and incremental in nature. • third, while some solutions may lie in changes to international financial architecture, i believe that the most productive remedies are generally those that apply at the national level - a point made strongly in an address given last month by joseph yam. there is a danger that the debate on the grander elements of international financial architecture could distract attention from the need for sound policy reform at the national level. • and finally, we should not fall into the trap of placing excessive reliance on any one policy response. for example, financial regulation alone cannot provide all the solutions. and equally, improved transparency and market disciplines on their own will not be sufficient. the answer lies in striking a sensible balance among a number of mutually supportive policies. that balance will

. [ 3 ] https : / / www. rba. gov. au / speeches / 2021 / sp - dg - 2021 - 09 - 09. html 2 / 5 9 / 10 / 21, 4 : 13 pm priorities of emeap and update on global fx code of conduct | speeches | rba the linkage of singapore's paynow and thailand's promptpay real - time retail payment systems. [ 4 ] project dunbar, which involves the rba, bank negara malaysia, the monetary authority of singapore, the south african reserve bank and the bis innovation hub. project dunbar will develop prototypes of a common multilateral settlement platform that will enable international settlements with digital currencies issued by multiple central banks ( as opposed to reliance on existing payment systems ). [ 5 ] fx global code the fx global code was launched in may 2017. the code set out global principles of good practice in the fx market to provide a common set of guidance to the market. the 55 principles in the code cover ethics, information sharing, aspects of execution including e - trading and platforms, prime brokerage, governance, risk management and compliance, and confirmation and settlement. the code is maintained by the global foreign exchange committee ( gfxc ) which i currently chair. the gfxc consists of the various foreign exchange committees ( fxcs ) across the globe. it comprises all the top fx markets by turnover, both advanced and emerging markets. the members of the gfxc are both central banks and market participants drawn from all parts of the markets : from the buy side, including corporates and asset managers, and the sell side, along with trading platforms, ecns and non - bank participants. when we launched the code, it was agreed that the code would be reviewed by the gfxc every three years to ensure it remained appropriate and to also ensure it stayed current with the ongoing evolution of the fx market. hence, around two years ago, the gfxc surveyed market participants to assess what areas of the code needed to be reviewed. [ 6 ] the primary response of market participants was that the code remained fit for purpose and changes should only be made as necessary. the gfxc identified a few key areas requiring review to ensure that the code continues to provide appropriate guidance and contributes to an effectively functioning market, and remains in step with the evolution of the market. [ 7 ] over the past 18 months, various working groups of the