The 1st Joint Regional Financing Arrangements (RFAs) Research Seminar

Date & Time: Thursday, September 7, 2017, 9:30 AM – 5:05 PM

Location: Fullerton Hotel, Singapore

Overview

The inaugural Joint Regional Financing Arrangement (RFA) Research Seminar co-organized by the ASEAN+3 Macroeconomic Research Office (AMRO), the European Stability Mechanism (ESM), and the Fondo Latinoamericano de Reservas (FLAR), will be held on September 7, 2017 in Singapore. The seminar is an annual event aiming at bringing academics and institutions together to discuss key issues pertaining to global and regional financial stability.

AMRO Director junhong Chang and ESM Managing Director Klaus Regling will deliver the opening remarks and keynote speech, respectively. The full-day event will comprise three sessions. The first session, led by AMRO Chief Economist Hoe Ee Khor will focus on the methodology, current practices and challenges pertaining to economic surveillance. Chaired by ESM Chief Economist Rolf Strauch, the second session will discuss lessons learned from the past for future crisis prevention. The last session, led FLAR Director of Economic Studies Carlos Giraldo, will discuss crisis management with a focus on liquidity provision and moral hazard concerns.

Among the discussants and speakers will be renowned academics and experts, representatives from international, regional and national organizations, and the private sector.

The event is by invitation only.

Agenda

8:30 am to 9:00 am	Registration
9:00 am to 9:05 am	Opening Remarks Junhong Chang, Director, AMRO
9:05 am to 9:15 am	Keynote Speech Klaus Regling, Managing Director, ESM
	Session 1: Economic Surveillance – Methodology, Current Practices, and Challenges Economic surveillance is key to identify main signals that can potentially lead to a crisis. RFAs are keen to strengthen their capacity of economic surveillance with the contribution from academics. This session will focus on the methodology, current practices and challenges pertaining to economic surveillance, with a particular interest in tools on sovereign vulnerability assessment, early warning signals, current account sustainability as well as fiscal sustainability. Chair: Hoe Ee Khor, Chief Economist, AMRO Presenters: Hyun Min Jung, Korea Centre for International Finance Murtaza Syed, Deputy Division Chief of Advanced Economies and Multilateral Issues, IMF Discussants: Akira Ariyoshi, Advisory Panel Member, AMRO Kyung Wook Hur, Advisory Panel Member, AMRO Juan Rojas, Head of Economic and Market Analysis, ESM Servaas Deroose, Deputy Director General, DG ECFIN, European Commission Q&A
11:15 am to 11:45 am	Photo Session and Coffee Break
11:30 am to 1:45 pm	Session 2: Lessons Learned from the Past for Future Crisis Prevention A number of regions, including East Asia, Latin America and Europe, have gone through crises of different types in the past. This session will contribute to the understanding of the different types of crises (e.g. currency crisis, bank runs, sovereign debt crises, etc.), and how to deal with them. Different RFAs are in fact set up to deal with different crisis types; this also explains the variety of instruments available at different RFAs. The session will also address ways to deal with spillovers across countries and regions and from global financial markets. Chair: Rolf Strauch, Member of Management Board and Chief Economist, ESM Presenters: Giancarlo Corsetti, Cambridge University Joshua Aizenman, University of Southern California Discussants: Bandid Nijathaworn, Advisory Panel Member, AMRO He Fan, Peking University, HSBC School Sergey Ulatov, Director for Coordination of Activities, Eurasian Development Bank Antoine Chery, Head of Economic Service for ASEAN Countries, French Embassy in Singapore Q&A
1:45 pm to 2:45 pm	Lunch
2:45 pm to 4:45 pm	Session 3: Crisis Management – Liquidity Provision vs. Moral Hazard Concerns In times of crises, swift reaction for crisis resolution is important. At the same time, to prevent facility shopping and to contain moral hazard risks also matter. This session will discuss how to address these concerns, using conditionality or other instruments. Chair: Carlos Giraldo, Director, Economic Studies, FLAR Presenters: Jeromin Zettelmeyer, Senior Fellow, Peterson Institute for International Economics Randall Henning, American University Discussants: Maria Socorro Gochoco-Bautista, Advisory Panel Member, AMRO Beatrice Weder di Mauro, Distinguished Fellow in Residence, Emerging Markets Institute, INSEAD Lucas ter Braak, Deputy Head of Division, EU Institutions & Fora Division, ECB Gong Cheng, Senior Economist, ESM Q&A
4:45 pm to 4:50 pm	Closing Remarks Carlos Giraldo, Economic Studies Director, FLAR

(The agenda was last updated at 5:00 PM on September 04, 2017)

Speech

AMRO Director Dr Junhong Chang’s Opening Remarks

ESM Managing Director Klaus Regling’s Keynote Speech

Press Release

Enhancing Cross-region Collaboration in Economic Surveillance and Crisis Management to Better Safeguard Global Financial Stability

SINGAPORE, September 7, 2017 – Stronger cooperation among the different layers of the Global Financial Safety Net (GFSN) is crucial to prevent and contain future crises and safeguard global financial stability, participants at an international research seminar held today in Singapore highlighted.

Jointly organized by ASEAN+3 Macroeconomic Research Office (AMRO), the European Stability Mechanism (ESM), and the Fondo Latinoamericano de Reservas (FLAR) – the 1^st Joint Regional Financing Arrangements (RFAs) Research Seminar is an annual event aiming at bringing academics and institutions together to discuss key issues pertaining to global and regional financial stability. Topics included economic surveillance, crisis prevention and management. Among the discussants and speakers were renowned academics and experts, representatives from international, regional and national organizations, and the private sector.

“Expanding the role of RFAs in the Global Financial Safety Net (GFSN) can contribute to safeguarding regional and global financial stability,” said Dr Junhong Chang, AMRO Director. “As most of the RFAs are in the early stages of development, exchanging views on best practices, enhancing our capacity and building stronger collaboration between the IMF and RFAs, as well as among RFAs ourselves are fundamental.”

Klaus Regling, Managing director of the ESM said: “Financial crises happen in our modern economies, and the tools that we have available to fight and to prevent them need to be in optimal shape. Today’s conference in Singapore is an important commitment to that end. Collaboration between RFA is important for crisis prevention and each institution must find its own working relationship with the IMF.”

Participants agreed that in crisis management, prevention was better than cure. Therefore, sound economic surveillance was key to identify main risks that could potentially lead to a crisis. To strengthen the capacity of RFAs and collaboration among them and with the IMF in this field, panellists and participants exchanged views on the methodology, best practices, and challenges pertaining to economic surveillance, both at the country and regional levels.

In particular, the panellists looked at the best practice of early warning toolkits, which include indicators to monitor individual economies, and discussed how to further enhance these toolkits. RFAs were also encouraged to better collaborate to develop their own surveillance frameworks to prevent possible crises in the future. The IMF’s risk assessment frameworks can provide a useful reference.

Experience shows that different regions, including East Asia, Latin America and Europe, have gone through crises of different types. These include currency crisis, bank runs, and sovereign debt crises, all of which required a variety of instruments to deal with. In fact, different RFAs were set up to deal with different crisis types. The seminar discussed how to deal with large economic shocks of different types and contain regional spillovers based on past crises in Asia, Latin America and Europe.

In times of crises, a swift reaction is quite important for crisis resolution. At the same time, as external liquidity insurance providers, RFAs should encourage the implementation of proper and timely measures to correct macroeconomic imbalances, contain moral hazard risks, and prevent facility shopping in case of multiple financing available. This represents an important challenge for the global financial safety net. The seminar discussed on how to address this challenge, through conditionality and other instruments.

On behalf of Dr. José Darío Uribe, FLAR’s Executive President, Carlos Giraldo, FLAR’s Economic Studies Director, stated: “From the standpoint of the emerging and developing economies, strengthening the Global Financial Safety Net is a crucial element for macroeconomic stability and wellbeing, as these economies are exposed to major changes in financial and commercial conditions. Today’s conference was very productive and allowed us to clarify the main elements to be researched and discussed in future events, in order to bolster the Global Financial Safety Net.”

The 2^nd High-Level RFA Dialogue will take place in October in Washington, D.C., which will focus on the cooperation among RFAs and between RFAs and the IMF.

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For media inquiry:

AMRO:

Huong Lan Vu, Public Relations Officer,

Email: vu.lanhuong@amro-asia.org; Tel: +65 88763598

Website: www.amro-asia.org

ESM:

Wolfgang Proissl, Head of Communications

Email: w.proissl@esm.europa.eu; Tel: +352 621 239 454

Website: www.esm.europa.eu

FLAR:

Diana Briceño, Protocol and Public Relations Manager

Email: dbriceno@flar.net; Tel: +571 634 43 60 (Ext. 239)