Australia has been invited to join the Financial Stability Forum. This follows the announcement by the G7 Heads of Government at their recent economic summit that the Financial Stability Forum should be broadened to include significant financial centres.
The Financial Stability Forum was initiated by the G7 countries earlier this year as part of their response to strengthening the international financial system. Its focus is to promote information exchange and co-ordination on financial issues among national authorities, international institutions and international financial regulatory bodies.
The initial participants in the Forum involved the finance ministries, central banks and lead regulators of each of the G7 countries, together with the chairs of the international regulatory organisations, and representatives of the international financial institutions. Following the recent decision by G7 Leaders to broaden the Forum to include four additional significant financial centres, Australia, Hong Kong SAR, Singapore and the Netherlands have been invited to participate.
I welcome Australia's inclusion in the Financial Stability Forum. It is a recognition of the significant contribution Australia has made to international financial reform issues since the onset of the Asian financial crisis. It also reaffirms Australia's growing importance as a centre for global financial services.
- In December 1998, I presented to the Prime Minister the report of the Task Force on International Financial Reform. This report has received considerable international support.
- Australia has played a high-profile role in advancing international financial reform issues, including in the G22, the Manila Framework Group, the Interim Committee of the International Monetary Fund, and in APEC. We have also made an important contribution in providing training in financial sector regulatory issues to the economies in our region.
Issues currently being addressed by the Financial Stability Forum include the activities of highly leveraged institutions (including hedge funds), measures to reduce the volatility of capital flows and the risk of short-term external indebtedness, and the impact on financial stability of off-shore financial centres.