watchdogs, it was revealed yesterday.

For a meeting of Commonwealth Finance Ministers in Canada last week backed the creation of international "super-regulators'' to police the world's economic powerhouses in banking, finance and insurance.

Finance Minister Grant Gibbons said the message from the world's top finance ministers like UK Chancellor of the Exchequer Gordon Brown and Canadian Finance Minister Paul Martin was that regulation to prevent economic meltdowns spreading was needed.

Dr. Gibbons added: "One of the things Bermuda can expect is increasing oversight by some of these regulators.

"There's going to be much more emphasis on peer review where outside members of the Basle banking committee, for example, will come in and see if our supervisors are up to speed.'' The new drive was sparked by the "contagion'' of economic depression spreading from the one-time "tiger economies'' of South East Asia, who hit serious problems last year.

Dr. Gibbons said: "There is real concern about the contagion we're seeing from South East Asia -- places like Malaysia and Hong Kong are suffering from the problems other economies in the area are having.'' He added: "Gordon Brown expressed it in casual remarks and also in more formal statements.

"There is a need for a more international surveillance of countries' financial systems and also of international capital flows.

"It's not just to point out weaknesses, but to make sure they are addressed and identify systemic risks to the global financial system.'' Dr. Gibbons said a special standing committee -- which could meet as frequently as once a month -- and involving the World Bank, the International Monetary Fund and the Swiss-based Basle group and other "super-regulators'' had been proposed. And he added: "One of the directions which is clearly being put here is that there should be a greater emphasis on the private sector increasing its risk assessments.

"There is a perceived need for institutions such as banks to show increased transparency and increased cooperation between different regulators.'' Dr. Gibbons said: "There is going to be an increasing emphasis put on transparency, not only in how Governments transact their business, but in how banks transact their business.'' He added that the new trend validated Bermuda's desire to keep up with new and stricter directives from organisations like the Basle group.

But Dr. Gibbons said that he had worked hard to dispel prejudice -- especially in Europe -- against what are seen as "unstable'' offshore economies.

Regulators to watch Bermuda He said: "Although London and Luxembourg are two of the biggest offshore economies in the world, there is a tendency to see smaller island countries as unstable and having a very negative impact on the global financial situation.

"One of the things I was exploring with the UK delegation is that one thing Britain and Bermuda have almost a mutual interest in is that some small states have not only done well but thrived in the world economy.

"Bermuda in many respects could be a model for some of the other small states. It's important that the UK be proud of Bermuda and some of the other Overseas Territories and what they have accomplished. We've not only been self-dependent, but made contributions to the world economic situation.'' Dr. Gibbons added that Mr. Brown had shown "moral leadership'' and told Commonwealth delegates that money earned must be re-invested in training and education -- a line Government in Bermuda was already pushing.

He said: "Gordon Brown had a very clear social agenda as well, which nicely mirrored what we are doing in Bermuda.

"That is not guaranteeing that nothing will change or being able to defend people against change -- that's clearly not possible -- but being able to equip people to adapt to and master change.''