Be it triggered by a market shock, a pandemic, or a major political event, a financial crisis usually happens fast and furious, and countries need a strong financial safety net to uphold economic stability, safeguard jobs, and protect people’s well-being.

The protection for our world has come from this invisible shield known as the Global Financial Safety Net (GFSN) and made up of four layers: countries’ international reserves, central bank swap lines, regional financing arrangements (RFAs), and the International Monetary Fund (IMF). These layers jointly play a vital role in safeguarding the global economy.

As the global landscape becomes more complex and interconnected, it is timely to reassess whether the GFSN is keeping pace with the evolving environment.

A safety net under strain

The IMF’s paper on the Global Financial Safety Net – A Stocktaking this October has offered a timely review—its first major reassessment since 2016—of how well the system functions in today’s environment and provides invaluable insights for policymakers worldwide and across ASEAN+3.

The backdrop is sobering. The world is far more digitalized than before, with financial flows moving at lightning speed and new technologies reshaping how money is created, transferred, and risked. Meanwhile, geopolitical tensions are rewiring trade routes and fragmenting markets, and climate-related disasters carry mounting economic costs. Many countries – both advanced and developing – face historically high public debt and shrinking policy space.

These forces will jointly test whether the GFSN has sufficient capacity and agility needed in future crises.

The GFSN has grown but remains unbalanced

The Stocktaking paper underscores that while the GFSN has become larger and more sophisticated than a decade ago, its layers are fragmented and offer uneven protection to countries:

  • International reserves remain the biggest buffer, especially for emerging economies that now hold nearly two-thirds of global reserves. But the pace of reserve growth has slowed, and many countries cannot rely on reserves alone if crises become protracted.
  • Central bank swap lines continue to provide rapid access to foreign currencies, but their availability is far from universal. During the COVID-19 pandemic, unlimited US dollar swap lines helped advanced economies stabilize markets quickly, while many developing economies had limited or no access to this lifeline.
  • RFAs, including the ASEAN+3’s Chiang Mai Initiative Multilateralisation (CMIM), were created to fill gaps in the system. Yet the Stocktaking paper shows a pattern of underuse across RFAs worldwide, despite substantial resources. The CMIM’s US$240 billion, for instance, has never been tapped, even during the global or pandemic crises.

Demand for emergency financing may rise significantly

As new risks emerge, the Stocktaking paper models how structural forces such as digital finance, geoeconomic fragmentation, and climate transition could shape future liquidity needs. These scenarios show that demand for emergency financing is likely to rise significantly, especially for low-income and emerging economies.

If shocks become more frequent, simultaneous, or fast-moving, gaps in the GFSN’s coverage could widen further.

A key takeaway from the IMF paper is that the GFSN’s layers often operate in silos. Cooperation between the IMF and some RFAs improved during the pandemic, but coordination remains largely informal, sporadic, and unstructured. The absence of regular joint exercises, standardized data sharing, and coordinated communication is likely to weaken the system’s overall effectiveness.

A pivotal moment for ASEAN+3
For the ASEAN+3 region, one of the world’s most interconnected production and financial networks, the Stocktaking paper’s messages carry particular weight. Past crises, from the Asian Financial Crisis to the Global Financial Crisis and the pandemic have shown how a crisis in one country can rapidly spill over to its neighbors through trade linkages, supply‑chain disruptions, cross‑border banking exposures, and abrupt shifts in investor risk perception.

The CMIM, anchored by AMRO’s surveillance expertise, is a key regional line of defence. However, no single layer of the GFSN can deliver effective protection alone. Resources matter, but so do operational readiness, robust surveillance, and timely coordination with the IMF.

Closer CMIM/AMRO-IMF cooperation is needed

Deepening cooperation between CMIM/AMRO and the IMF is vital for making the ASEAN+3 a safer region. This means:

  • Institutionalizing joint program design, building on past CMIM-IMF test runs. Shared playbooks can clarify roles, align conditionality and communication strategies, reducing uncertainty and helping mitigate stigma around IMF engagement.
  • Coordinated activation of regional and global financing arrangements so countries can access support as a coherent package rather than as separate options.
  • Real‑time sharing of economic assessments between AMRO and the IMF to strengthen early‑warning capabilities, align views on risks and policy options, and detect emerging vulnerabilities sooner.

Importantly, market confidence hinges not only on available resources but on the credibility and coordination of the GFSN actors.

AMRO’s role as a regional anchor must expand

To strengthen ASEAN+3’s crisis readiness, AMRO’s role must evolve from a surveillance provider into a regional anchor for crisis prevention and resolution, and financial cooperation.

This includes deeper technical engagement with member authorities, embedding surveillance expertise into policy dialogues, including fiscal and monetary exchange, expanding technical assistance, and strengthening ties with peer RFAs and the IMF. These steps can help ensure that analytical insights translate into operational preparedness and that ASEAN+3 speaks with a more coherent voice in the GFSN system.

The IMF Stocktake – A warning and a reform agenda

The IMF’s 2025 Stocktaking paper is not merely an assessment; it is a call to action. It highlights where the GFSN falls short and how the global system – including ASEAN+3 – can adapt to a more shock-prone world. Priority areas include:

  • Broadening and rebalancing access to GFSN layers;
  • Strengthening precautionary instruments to improve speed and predictability;
  • Embedding stronger incentives for sound policies and early action;
  • Moving from informal to structured, institutionalized coordination across the IMF, RFAs, swap providers, and reserve holders.

For ASEAN+3, this implies not only enhancing CMIM’s toolkits but also deepening operational links with the IMF – so that countries can access support quickly, predictably, and in a coordinated fashion.

Ultimately, the resilience of ASEAN+3, and of the global economy, will depend not only on headline ‘firepower’ figures but on how effectively institutions across the GFSN can combat the fires together when the next crisis strikes.