With the growing and changing global economy, I have no doubt that DFIs will remain important and relevant to meet the increasing developmental needs of their respective countries. This development, indeed, presents both opportunities and challenges to the DFIs in the way forward. While the expanding economies, both in the developed and developing countries, would create greater business activities for the DFIs, this also means that they have to remain innovative in their products and services by exploring new ways of doing business, to be able to respond effectively to the different financing and developmental requirements. DFIs must continuously evolve and review their areas of comparative advantage in order to remain relevant, effective and strategic. To drive performance, one important aspect is to clearly identify key performance indicators for the DFIs, in order to measure efficiency and effectiveness in performing their mandated roles. Recognising DFIs' developmental role, the performance measurement of a DFI should go beyond the standard financial measurement to encompass quantitative and qualitative non-financial indicators that evaluate the economic and social contribution of DFIs, consistent with their objectives of establishment. For DFIs that are involved in SME development, the key performance indicators should include the number of new start-ups financed, the extent of borrowers receiving advisory services and the number of SMEs that have "graduated" from the DFIs. An important aspect to highlight is the need for DFIs to be financially sound and sustainable in their operations.

Against this background, the gradual recovery in  domestic demand is expected to continue into the first quarter (Figure 27). However, I would also like to emphasize that the achievement of a two-digit annual growth rate is highly probable in the first quarter of 2010 due to the low base of the same period last year. The weak course of external demand continues to restrain economic activity and employment growth through its impact on industrial production. As a matter of fact, despite the recent partial recovery, indicators such as per capita hours worked across industries and capacity utilization rates of firms oriented towards export markets suggest that resource utilization remains low throughout the economy (Figure 26). The recovery in the labor market that started in the third quarter of 2009 continued into the fourth quarter, albeit at a slower pace. Unemployment declined in seasonally adjusted terms, but still remains elevated (Figure 28). Given that ample slack would continue to be a drag on investment and employment, signs of improvement in employment data during the second half of 2009 are not expected to turn into a robust recovery, suggesting that the unemployment rate will likely remain elevated for an extended period. Therefore, unit labor costs would continue to support disinflation (Figure 29). Overall, recent data releases suggest that the economic recovery has become more robust. Domestic demand would continue to recover, while the weak outlook for global growth would dampen economic activity and employment in the tradable sector for sometime.