The economic reforms in the real sector have improved the overall productivity and resilience in Asia. The macro economic conditions in Asia, as a whole, are significantly stronger and conducive to overall stability relative to the past. The financial systems in most countries, both markets and institutions, are far more efficient and resilient than before.
The external sector has been strengthened and considerable reserves provide cushions to withstand financial contagion. In fact, it is felt by many, that Asia’s reserves can help smoothen the process of unwinding of global imbalances that appears to be underway through, what has been described as “falling with a parachute" scenario.