ANNUAL REPORT 2002 / 2003


Sluggish growth in the industrialised economies, heightened security concerns over terrorism and terrorist financing made 2002 a challenging year for the international financial community. In response, MAS participated in international and regional efforts aimed at improving co-operation and fostering growth in the financial sector. 

Guarding Against Terrorist Financing

Singapore has stepped up its proactive stance in the fight against money laundering and terrorist financing. MAS has strengthened its regulations to implement the UN’s anti-terrorist financing resolutions. MAS takes part, under the lead of the Ministry of Home Affairs, in the Financial Action Task Force (FATF) on Money Laundering which spearheads the international community’s drive to combat money laundering and terrorist financing.

MAS is also an active member of the Asia Pacific Group on Money Laundering (APG), which encourages the adoption of international anti-money laundering standards in the region. MAS also supports the work done in regional fora such as the Anti-Terrorism Financing initiative under Association of South-east Asian Nations (ASEAN) Finance Ministers’ process. As part of the 2003 Asia Pacific Economic Co-operation (APEC) Finance Ministers’ process, Singapore is chairing with the US an initiative on Alternative Remittance Systems.

Strengthening Global Free Trade

As a free, open and highly trade dependent economy, Singapore is keen to ensure that global trade is based on a rule-based system where goods and services can flow freely. MAS believes in the benefits that come with Free Trade Agreements (FTA), whether these are at the multilateral, regional or bilateral level. MAS has been actively involved in FTA negotiations relating to the financial services sector. In the past year, Singapore concluded free trade negotiations with major trading partners such as the US and Australia, and continued negotiations with Canada.

Enhancing Regional Co-operation

The riskier economic environment makes regional co-operation all the more important. MAS holds regular dialogue with other central banks and financial regulators to exchange views and share experiences. These exchanges strengthen bilateral co-operation and relations. In 2002, MAS hosted bilateral meetings with the Bank of Thailand and the Hong Kong Monetary Authority.

The pace of globalisation calls for efficient, flexible and competitive financial markets, a fact highlighted during the 1997 Asian economic crisis. Recovery from the 1997 financial crisis notwithstanding, institutional strengthening and capacity building remain high on the agenda. MAS continued to contribute to the region’s capacity building for long-term growth. MAS hosted a regional workshop on the “Development of Bond Markets in Asia” in October 2002 at which participating countries identified areas for co-operation in bond market development in the region.

In collaboration with the South-east Asian Central Banks (SEACEN) Centre and the Financial Stability Institute, MAS hosted a workshop on “New Capital Accord” in March 2003. MAS also ran training and attachment programmes to share its experience with regional partners, including People’s Bank of China, Bank of Thailand, Bank Indonesia, National Bank of Cambodia and the State Bank of Vietnam. The IMF-Singapore Regional Training Institute (STI), a partnership between the IMF Institute and the Singapore Government, conducted courses in macroeconomic and financial policies for officials from the Asia Pacific region.

Singapore was chosen last year to host the 2006 IMF/World Bank Annual Meetings. This will be a good opportunity for the international financial community to gather again in Asia and reaffirm their confidence in the region’s growth prospects.

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