At same time, the increasing economic weight of EMEs makes the functioning of these local currency bond markets an increasingly important factor for global financial stability. Most EMEs have already implemented major reforms to develop their domestic markets in recent years. They have thus reduced their dependence on external credit sources and made their economies less vulnerable to exchange rate and interest rate fluctuations.
However, the cost of addressing these changes is but a fraction of the cost that we would have to pay, if we allow climate change to continue unabated, without taking any preventive action.