although larger, has also become more fragmented and asymmetric. some of its key building blocks have not been fully tested, and some of its key aspects suffer to various degrees from being costly, unreliable, and lacking adequate policy incentives. this shared diagnosis offers a key opportunity to strengthen the gfsn. reserves, swap lines and regional financial arrangements ( rfas ) are not a substitute for having a strong, well - resourced imf at the heart of it, on the back of the recent approval of the 2010 quota and governance reforms, which has strengthened the fund legitimacy. from our perspective, three elements stand out : first, identify potential ways to improve the use of existing imf facilities, notably precautionary facilities, and / or consider the possible creation of new facilities. the objective here is to mitigate stigma, without creating moral hazard. second, ensure that the imf is adequately equipped to deal with the vulnerabilities of low income countries, emerging market economies and commodity exporters : gcc ( gulf cooperation countries ), cemac ( central african economic and monetary community ) and latin american countries have all been affected by the recent drop in commodity prices. broad coverage requires making sure that the imf is adequately resourced, both in terms of permanent resources, and through state contingent financing resources in case of common shocks or systemic crises. third, there are also ways for the gfsn to operate better without the fund extending more financing. there may be benefits in further use of “ signaling ” instruments, which share most of the features of regular programs but without financing. for example, countries like senegal or nigeria have relied on the imf policy support instrument : this program enables low - income countries to benefit from fund ’ s advice and support, which sends a clear signal to donors, creditors and markets. however, these instruments are only available for lowincome countries ; there is to date no equivalent tool for emerging or advanced economies. such instruments could help in certain situations ( for instance during systemic crises ) where it is essential to maintain market access and facilitate rollover of private financing. with this i would like to conclude my presentation. i very much look forward to our discussions today and to seeing the work of the ifa work stream in the coming months. bis central bankers ’ speeches

the procyclicality can be trimmed through prudential regulation but i strongly believe that our first line of defense against procyclicality should be the accounting framework. i therefore support the current focus on reducing the scope of the mark - to - market approach and moving from an incurred loss model to a forward - looking model for provisioning. conclusions to conclude, the main challenge ahead of us is to find the right balance between all these measures and the short - run effects of the rebalancing. if the rebalancing process happens too fast, it might weaken the recovery ; but if reforms are delayed too much, the longer - run growth prospects will be affected negatively. one very important issue to focus on while analyzing this trade - off is that policy decisions need to be perfectly coordinated across countries. the crisis has demonstrated that it was necessary, and that it was possible. i am confident that the g20 roadmap is the right approach to this coordination problem. we will, under the french leadership of the 2011 g20, pay due attention to the smooth implementation of this process.