The massive financial stimulus measures adopted by developed countries have boosted their economies, but these now have to be wound down with care, with countries taking steps to protect themselves from the side effects.
Singapore has done so through a series of policy steps, including several rounds of measures to cool the overheated property market, which had seen prices rise partly through the flow of cheap funds from abroad.
Prime Minister Lee Hsien Loong noted this on Friday, as he wrapped up his trip to St Petersburg, Russia, to attend the G-20 summit.
During the two-day summit, leaders voiced concerns about an over-rapid winding down of the huge US$85 billion (S$109 billion) a month bond-buying programme by the United States Federal Reserve.
Concerns over this had caused markets to plunge in emerging economies, with India and Indonesia being especially hard-hit.
Mr Lee noted that emerging economies, like Brazil, had made their views about this known strongly during the leaders' discussions.
But advanced countries also had their own reasons for taking the measures to boost their economies.
"The overriding requirement is to get the US economy up, and the European economy up, healthy and growing, because if that is sick, then we are all in deep trouble," noted Mr Lee.
But while everyone knew this, and acknowledged the benefits of the stimulus measures, how to go about withdrawing them was now the challenge, he said.
He added that a new reality, as part of a globalised world, is that policies which were once considered domestic issues could now have an impact on other countries as well.
"This is why we watch the world around us very carefully," said Mr Lee.
"And we hope that Singaporeans do so too, that they also read the world news pages in The Straits Times," he said with a laugh.
He said it was useful for Singapore, a non-G-20 country, to be present at these summits. Doing so enabled its leaders to be aware of issues that countries were discussing, and to try to offer an interesting and useful perspective, which could help influence and shape the deliberations.
"By being present at these meetings, we have a chance to speak, to engage the other leaders," he said. G-20 leaders wrapped up their discussions on Friday, stressing in a joint communique that "strengthening growth and creating jobs is our top priority".
"In the five years since we first met, coordinated action by the G-20 has been critical to tackling the financial crisis and putting the world economy on a path to recovery."
But, they added, the job was not yet done, and efforts had to be made to engineer "a durable exit from the longest and most protracted crisis in modern history".
"Our most urgent need is to increase the momentum of the global recovery, generate higher growth and better jobs, while strengthening the foundations for long-term growth and avoiding policies that could cause the recovery to falter or promote growth at other countries' expense." firstname.lastname@example.org
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