At the time, he led IMF missions to Thailand, Indonesia and Malaysia. As one of the key men to implement the fund's support programme for Thailand, Singh offers a global perspective on the lesson of the Asian crisis.

Ten years have now passed since the tumultuous events in Thailand that foreshadowed the Asian crisis, famously called the most serious global economic crisis in the post-war era.

It was late evening in Washington on July 1, 1997, when we heard the news that Thailand had allowed the baht to be devalued after months of speculation and uncertainty but more than a decade of stability.

This event became the eye of a storm that would spread quickly beyond the country's borders and eventually engulf much of Asia, later radiating outside of the continent to places as diverse and far-flung as Brazil and Russia and eventually affecting investor sentiment in the major industrialised countries.

After witnessing globalisation's critical contribution to Asia's economic performance over previous decades, its underbelly was suddenly exposed and with it the economic and social destruction that "sudden stops" (reversals of capital flows) can leave in their wake.

But the Asian countries rallied to deal decisively with the crisis, reinforced by international rescue efforts, and economic activity in the region generally rebounded in a "V-shaped" fashion, recovering faster than anyone could have expected and, remarkably, putting countries back on their growth path within a year.

Today, Asia and the global economy are impressively strong again. Notwithstanding risks from "global imbalances" and high and volatile energy prices, the world has experienced a sustained period of high and stable growth accompanied by low inflation, with the past five years delivering better results than in any comparable period since the 1960s.

The Asian crisis left an enduring legacy in its wake. At the time, governments around the region were confronted with difficult trade-offs between different policy options and forced to make rapid decisions that have since been closely analysed by the economics profession.

Looking back over the past decade, it is clear to me the events of that period permanently changed the manner in which policy-makers confront crisis prevention. The shock waves that reverberated across Asia 10 years ago challenged our understanding of fundamental policy choices and forced a rethink along several important dimensions within the International Monetary Fund, among national governments, by scholars and analysts and in the economics profession at large.

Let us look at the consensus that seems to have been reached on some of those policy trade-offs since then.

Globalisation. First and foremost, it is striking that Asia did not retreat from globalisation following the 1997-98 crises. This was a fundamentally important decision. The credit goes to the leadership of those who managed the crises of that period and the enduring commitment to internationalism of the governments that followed.

Instead, since the late 1990s there has actually been a jump in the volume of cross-border trade and financial flows in the region, and the global economy has become markedly more integrated. In particular, over the past decade we have seen extraordinary growth in financial innovation through the development of new risk-transfer instruments and markets. There is wide recognition that these developments contribute to deeper and more efficient markets in good times, which enhance stability by diversifying exposure and risk.

For many countries, they also increase the potential for capital markets to mediate savings through a broader array of instruments, lowering the overall cost of capital, encouraging the development of local capital markets and potentially boosting productivity and growth.

Overall, these global developments, in my view, validate the crucial decision made in Asia a decade ago to remain integrated and resist pressures to retreat towards more inward-looking economic strategies.

The risks of financial integration, however, have clearly not gone away. There is a fear that in periods of turbulence, these same financial innovations could precipitate or exacerbate volatility in capital flows. Therefore, sudden stops in capital flows are not only still a possibility, but also perhaps even more unpredictable than before.

The experience of Asia in 1997-98 has been instrumental in shaping how these risks are now viewed. Prior to the crisis, there was a general feeling within the economics profession that capital-account liberalisation was per se sufficient to enhance growth prospects and improve welfare in the same way that the profession's views had converged in prior decades on the benefits of trade liberalisation.

Since the Asian crisis, however, a more nuanced view has emerged, emphasising that financial liberalisation - particularly to short-term or debt-creating inflows - needs to be accompanied by a robust macroeconomic framework, solid financial development and strong financial-sector supervision and regulation, including of non-banks and offshore centres.

Furthermore, the financial innovations of recent years, with their greater international linkages and spill-over effects, have yet to be tested by a cyclical downturn and thus pose a new challenge for policy-makers. Overall, the steep march of financial globalisation has raised the stakes, enhancing economic potential but also putting an even greater premium on the strength of individual countries' macroeconomic and financial frameworks.

The importance of balance sheets. Another lasting consequence of events in Asia in 1997-98 has been the increased focus on balance sheets and how corporate, financial-sector and government balance sheets interact, are affected by adverse shocks and propagate or even amplify these shocks across an economic system.

Over the past decade, major efforts have been undertaken to understand better the interconnectedness of such balance sheets and collect data on the extent and nature of these linkages, data that were simply unavailable at the time of the Thai crisis. More recently, as discussed above, rapid financial innovation and global growth of derivative products have facilitated a complex and subtle redistribution of risk across economic agents. Understanding whose balance sheet is vulnerable, where systemic risks actually lie and how they would manifest themselves in a bad scenario has, inevitably, become more difficult, but also more important than ever.

Transparency. A key lesson driven home by the Asian crisis was that in order for market mechanisms to work fully, the market itself must be in possession of as broad and accurate an information set as possible. Conversely, a lack of transparency risks raising the underlying cost of capital and even provoking quick and negative reactions by financial markets.

Responsible country authorities and market regulators have understood the essential importance attached to transparency in a more integrated world economy and in the past 10 years have vastly increased the provision of comprehensive information on their own operations and the financial intermediaries and listed corporations they oversee.

The IMF has also taken on an important role in this regard by increasingly publishing country surveillance documents and launching initiatives that range from assessments of fiscal transparency to minimum quality standards for official economic statistics and a code of good practice for monetary and financial policies.

Cross-border linkages. In addition to important interactions between balance sheets within a country, the Asian crisis brought home the painful lesson that in a globalised economy, all countries are inextricably intertwined. Policies in Thailand, for example, may affect not only its regional neighbours, but also countries clear across the other side of the planet. This feature of the modern economy has spawned a plethora of valuable academic research that seeks to identify and understand better the various channels of cross-border contagion and identify policies that may serve to counter these forces.

In addition, recognition of the lessening importance of national borders for economic policy has catalysed important regional initiatives - many of which Thailand has taken a leadership role in - such as the Chiang Mai Initiative. The IMF, an institution founded on the premise that there are important policy spill-overs among countries, has also looked to leverage its unique status to strengthen the global financial system.

Most recently, the institution facilitated the first "multilateral consultation" to examine the interactions between various countries' policies and seek a coordinated, multilateral approach to lessen risks from a disorderly unwinding of global imbalances.

Monetary and exchange-rate regimes. Clearly, the best insurance a country can invest in to increase its resilience to shocks is strengthening macroeconomic-policy frameworks. In this regard, the Asian crisis caused a fundamental rethink of how monetary policy should be conducted and the type of exchange-rate regime that a country should adopt.

During the first half of the 1990s, there was broad support for fixed exchange-rate regimes as a legitimate "anchor" for the price level, providing a stable and predictable framework around which private-sector decisions could be based. This was not only the case in Asia. Elsewhere, too, especially in Latin America, fixed exchange-rate systems were viewed as efficient disinflationary mechanisms.

However, events in Thailand, the rest of Asia and later in Latin America taught us the painful risks posed by offering private-sector players such an exchange-rate guarantee. Subsequently, within the academic literature and among policy-makers, a consensus has now grown of the relative benefits, in a large number of circumstances, of allowing the exchange rate to adjust flexibly to absorb international shocks (both good and bad). Exchange-rate flexibility also provides appropriate incentives for the private sector to hedge the exchange-rate risks they face.

Abandoning fixed exchange-rate systems has naturally led to a search for an alternative monetary anchor. Predominantly, countries have gravitated towards inflation-targeting regimes, which provide a flexible framework for monetary policy that can be readily customised to meet a variety of individual-country circumstances.

It is notable that prior to the Asian crisis, there were virtually no inflation targeters among emerging market countries, whereas now most of them - in addition to a number of industrial countries - either conduct or seek to move to such a monetary regime. This has been a sea change that, I believe, was catalysed, at least in part, by the events in Asia in the late 1990s.

Counter-cyclical fiscal policy. Another strand of our thinking that has undergone serious analysis and reflection following the Asia crisis concerns the appropriate fiscal response to emerging-market crises. Prior to the Thai crisis, for many the policy instinct was to handle adverse shocks through a generalised tightening of macroeconomic conditions, in order to instil confidence in the domestic economy. This would also allay concerns the government may be unable to pay its debt obligations, especially in the context of fiscally backed deposit guarantees and financial restructurings.

However, the experience in Asia highlighted the vital role that a counter-cyclical fiscal policy can potentially play in mitigating the impact of economic crises. This only works, of course, if the underlying fiscal position is sound at the time when the crisis hits. As a result, policy-makers are now more aware of the importance of taking advantage of the good times to lock in lower government indebtedness and give themselves room to manoeuvre in pursuing counter-cyclical fiscal policies when confronted by unanticipated shocks.

Indeed, fiscal positions have strengthened in many developing and emerging-market countries - including in regions such as Latin America, where weak fiscal positions have traditionally been a source of crises.

Social policy. Finally, I would like to say a word about the imperative of maintaining social cohesion and an equitable burden-sharing during periods of crisis, reform and change. As a result of events in Asia more than a decade ago, governments are more cognisant of the social impact of their policies and the importance of protecting the livelihoods of the most vulnerable members of society.

In particular, I believe, there is now a far-greater focus among policy-makers - including in the international community more generally - on building effective safety nets to protect the poor and disadvantaged and preparing avenues by which those in poverty may share in the benefits of long-term growth that policy-makers around the globe are striving to achieve.

Overall, competitive pressures of the global marketplace and the rapid pace of economic change and financial innovation across the globe have tested Thailand and the other countries that were at the centre of the Asian crisis. The region has risen to these challenges by perpetually reinventing its economic strategies in pursuit of higher productivity and growth. The results have been impressive, as Asia continues to outstrip the economic performance of many other regions of the world, especially in its ability to attract investment and keep productivity growth relatively high.

These have been some of my personal observations, drawn from a global perspective, of where the enduring lessons of Thailand's experience have been heard, internalised and permanently changed the economic profession's thinking on important policy issues. I am reassured that 10 years on, Thailand, like others in Asia, has left the crisis behind, nearly doubled its per-capita income and deepened its commitment to be at the forefront of an increasingly globalised world.