SINGAPORE (Nov 12): A decade on from the last global financial crisis, the global economy is facing a new suite of cross-border risks. This includes ballooning debt in emerging economies, brought on by fiscal expansion in the aftermath of the crisis, and which is now exposed to a strengthening US dollar and rising interest rates. As such, there is a need for better coordination among financial regulators across the markets to manage the cross-border risks, says Ravi Menon, managing director of the Monetary Authority of Singapore.

“If risk does not respect entity or sectoral boundaries, and flows to where there is least resistance like water, then regulation needs to be nimble and flexible to fix that,” says Menon on a panel at the Bloomberg New Economy Forum on Nov 7.

He thinks there needs to be mechanisms to manage global financial flows today. “If you have global capital markets, you need some form of global financial safety net. That is sorely lacking today,” he says.

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