pan gongsheng : deepening financial cooperation in asia keynote speech by mr pan gongsheng, governor of the people's bank of china, at the boao forum for asia annual conference 2024, session " deepening financial cooperation in asia ", boao, 27 march 2024. * * * distinguished guests, good morning! it's my great pleasure to attend the boao forum for asia annual conference. i would like to share my views on how we can strengthen the asian financial safety net from the global, regional, bilateral, and national perspectives. at the global level, we should push forward the imf quota reform. this can unleash the potential of the imf at the center of the global financial safety net. yesterday morning, the imf managing director visited the pboc and we discussed this topic, among others. the imf is a quota - based international financial institution. the total size of the quota determines the imf's lending capacity, and the quota share decides member countries'voting power and how much they can borrow from the imf. a quota share realignment is vital for the imf's governance, representation, and legitimacy. the 16th general review of quotas has been concluded recently with an equiproportional quota increase. it will further enhance the imf's capacity to respond to crises. however, the current quota share has been long overdue in reflecting members'relative weight in the world economy. this is why the need for realigning quota share is so urgent to improve the imf's governance and enhance its capacity. asian countries need to work together to advance the imf quota reform and expedite the quota share realignment. we hope to better reflect asian countries'relative positions in the world economy and raise the voice and representation of overall emerging markets and developing countries. we urge all stakeholders to build consensus on a new quota formula with no further delay. this will pave the way for the quota share realignment and ensure the imf remains a rule - based institution committed to true multilateralism. at the regional level, we need to enhance the effectiveness and the regional nature of the cmim. first, we should stick to the goal of safeguarding regional financial stability. thanks to constant reforms since its establishment in 2000, the cmim has made continuous progress in size, toolkits and economic surveillance of the region. the cmim is already a critical part of the regional

should vary depending on the countries. france and italy for instance are lagging behind and have to catch up, whereas other countries like germany, spain or the netherlands, among others, have succeeded in carrying out in - depth reforms and are now reaping the benefits in terms of gdp growth and employment. i wish to stress that these examples show that economic success is fully compatible with the european social model that we share, which combines high standards of public services and low levels of inequality – much lower than in american society for instance. and clearly we can now expect an acceleration of reforms in france : this will be welcome not only for my country, but for europe as a whole. the success of national reforms would be amplified if combined with two european reforms – the two other points of my triangle. the first one is microeconomic : the creation of a financing union for investment and innovation ( fuii ). the need for such a financing union comes both from a weakness, which is the persistent financial fragmentation in the euro area, and from an opportunity, which is the euro area savings exceeding investment by eur 350 billion per year. an obvious way to boost growth is therefore to better steer our abundant savings towards the financing of investment and innovation across borders. and this implies providing businesses with more equity financing solutions. europe is lagging far behind in this area : such financing only represents 68 % of gdp in the euro area compared with 128 % in the united states in the fourth quarter of 2016. creating the financing union would magnify the impact of national reforms : whereas they foster firms ’ willingness to invest, the financing union would foster firm s ’ ability to invest, and they would together foster microeconomic dynamics and competitiveness. 5 / 8 bis central bankers'speeches the efforts so far are going in the right direction, but work should now be accelerated. the building blocks already exist : the juncker investment plan ; the capital markets union ( cmu ), which supports the diversification of private financing ; and the banking union, which tackles the fragmentation issue. these initiatives have to be brought together into the fuii in order to go beyond administrative or bureaucratic borders, create synergies, and therefore give new impetus to this agenda. think for instance of a real european venture capital. to be more concrete, progress towards a financing union for investment and innovation requires fleshing out proposals in four key areas : first, completing the banking union. this means, as a priority, finalising the banking