Australia must stand ready to provide financial support and loan guarantees to regional neighbours in the event of economic crisis in Asia, one of Australia's top economic officials has warned.

Barry Sterland, who until recently represented Australia on the International Monetary Fund board, says there are "structural reasons" for thinking financial risks will remain high in Asia for some time to come.

In a paper published by the Lowy Institute on Friday, Mr Sterland argues that Australia should actively use its regional networks and membership of major international economic institutions to reduce the risks.

"Careful work with our partners inside and outside the region would give Australia greater confidence in achieving better outcomes, contributing to the resilience of the region and, ultimately, the Australian economy," the paper says.