Their purpose is to keep countries from taking on too much debt. Since the crisis, these rules have been strengthened – now it is important to apply them. To sum up, countries with flexible labour and product markets, stable banks and sound public finances are in a good position; they are resilient, and they are efficient.
But an official Australian RMB clearing bank also confers some indirect benefits on the Australian financial sector and its customers, particularly when viewed as one element of a broader range of initiatives. In particular, the establishment of the clearing bank helps to raise awareness among Australian firms that the local financial system has the capacity to effect cross-border RMB transactions on their behalf.