The International Monetary Fund (IMF) is ready to pull the trigger on reserve funds for any emerging economy that faces a current account crisis, the organization's deputy managing director said at the World Economic Forum in Dalian, China.
"If a country has payment problems, which will cause not only financial instability but systemic instability as well, and if a country is willing to request service from the Fund, those are the basic issues. Our job is to maintain global financial stability, particularly on payment issues," the IMF's Zhu Min said.
Zhu's comments echo those of IMF chief Christine Lagarde, who in August pledged policy advice and money through various instruments for emerging economies.
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However, Zhu was quick to dismiss the possibility of a 1997 Asian financial crisis redux, citing the region's strong fundamentals.
"I don't see a short-term crisis in emerging Asia because the situation is very different from 1997. Fundamentals are much better in terms of government debt and corporate debt, while household debt levels are much lower. Reserve levels are much higher and the net international investment position is much better.So, countries are in a much better position," stated Zhu.
He also stressed that governments must embrace transparency and greater clarity on policy framework as well as public communication in order to meet the higher expectations that markets carry as a result of globalization.
Zhu highlighted the importance of emerging nations in the Fund's overall decision-making process and described how the group has been incorporating more views and thoughts from those economies when forming global policies.
"For example, we've developed a macro-prudential framework, which is useful for emerging markets. It gives them a certain way to handle capital flows and manage macro stability – those things enhance the relationship between us and emerging market members," he added.
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When asked about the impact of next week's Federal Open Market Committee meeting, the Federal Reserve's decision-making body, Zhu Min said that volatility could definitely be expected.
"If the rewinding of monetary policy involving purchases of $85 billion to $65 billion, and $35 trillion balances to $1.5 trillion – that's a whole long process. It will involve lots of technical things and the market is not sure how this process will be managed," he said.
— By CNBC.com's Nyshka Chandran. Follow her on Twitter @NyshkaCNBC