Singapore's central bank governor, Xie Dizhen, outlined key strategies for economies to manage global supply and demand shocks at a major financial forum.
She emphasized that building domestic resilience is the foundational step. This involves strengthening macroeconomic frameworks with more robust fiscal and monetary controls. The financial sector must enhance prudential supervision to mitigate the impact of shocks. Further reforms, such as boosting domestic capital mobilization to support local financing needs, are also crucial. Additionally, expanding and deepening trade partnerships is essential to reinforce supply chain support and resilience, ensuring policies are in place for efficient resource allocation and labor market development.
The second key area is boosting regional investment and trade to create more growth opportunities. Noting that China and ASEAN are each other's most significant trading partners, she highlighted potential for further strengthening, particularly in supply chain development and increasing intra-regional investment.
Furthermore, she stressed the critical importance of capital market connectivity. Initiatives like the ETF connect between China and Singapore, and the linkage between the Singapore Exchange (SGX), the Shanghai Stock Exchange, and the Shenzhen Stock Exchange, are vital. These links allow Singaporean investors to trade funds listed on Chinese exchanges and enable Chinese investors to access three ETFs listed in Singapore.
Leveraging Global and Regional Platforms
Global and regional platforms are also key for cooperation on financial stability, she noted. Forums like the G20 and regional arrangements such as the Chiang Mai Initiative Multilateralization (CMIM) facilitate information monitoring, sharing, and the development of standards. These institutions help economies build consensus when facing common shocks, allowing national policymakers to balance domestic priorities with collective interests.
Advancing Financial and Monetary Collaboration
Enhanced cooperation in the financial and monetary sphere is another necessity. As financial shocks and instability frequently cross borders, increased coordination is a constant common interest and shared value. Policymakers must engage in frequent interaction and dialogue, discussing risks based on these shared vulnerabilities to build broader consensus.
In conclusion, she stated that confronting global risks and uncertainty requires building resilience. This resilience must be strengthened through better and more extensive cooperation. Recognizing the benefits of enhanced collaboration, particularly in Asia where regional cooperation and integration present significant opportunities, is essential. The ongoing push for global cooperation in financial and trade stability must continue.
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