30. The need for the financial development and regulatory reform remains as strong as ever in emerging markets.
Instead of innovating complex and sophisticated products and instruments or setting up financial behemoths, the EMEs require to focus more on the fundamental financial sector elements such as financial stability, strengthening and creating sound banking systems, widening the scope and reach of the formal financial system and services, expanding financial inclusion and enhancing financial literacy, improving monetary policy transmission as also developing and deepening the financial markets (such as corporate bond markets and basic currency derivatives) and making them more liquid, etc.