Most Emerging Asian countries have been quite successful in maintaining
macroeconomic and financial stability since the 1997-98 Asian financial crisis (AFC),
particularly in the wake of the 2007-08 global financial crisis (GFC). Their success is
a reflection of significant improvements in the key institutional frameworks that
underpin macroeconomic and financial stability: monetary policy; financial supervision
and regulation (prudential policy); exchange rate policy; and fiscal policies. However,
the difficulties Emerging Asian countries had to overcome in maintaining stability in
the wake of the GFC, their continuing struggle to manage large surges and withdrawals
in capital flows, and the broader lessons that have come out of the GFC have highlighted
the need for further improvements in these frameworks, particularly in the following
areas