The commencement of Commerce Takaful Berhad, which is indeed the first takaful operator to be launched this year, complements Bank Negara's initiatives of promoting the establishment of a core of strong players that could heighten competition and promote innovation in the takaful industry. This certainly will be reinforced by the establishment, InsyaAllah by the end of the year, of four additional takaful consortia and joint ventures between Malaysia and well-known foreign institutions. These four new institutions have recently been given official approval to conduct takaful business. The progress achieved by the takaful industry as a key component of the Islamic financial system has contributed towards the overall development of the Islamic financial industry. Islamic finance in Malaysia has evolved through several phases of development through the establishment of a number of key players and key market infrastructure. The Islamic finance industry in Malaysia has emerged as a viable and competitive component of the financial system, operating in parallel with the conventional financial system in contributing towards the nation's economic development and growth. Lembaga Tabung Haji, acknowledged to be the first Islamic financial institution in Malaysia, is now a major institution with a total deposits of more than RM13 billion. The Islamic banking industry, that consists  BIS Review 31/2006  1  of both dedicated Islamic banks and Islamic banking schemes in the conventional banks, continues to show commendable performance with profitability and assets surpassing for the first time the threshold of RM1 billion and RM100 billion respectively at the end of 2005.

Yet the risk of further market correction remains high. 6. The global economy remains highly vulnerable and we cannot fully assess the extent of the crisis yet, due to three factors: uncertainty over the dynamics of the pandemic; high spillovers on several fronts, and weakened international and domestic institutions. 7. The Covid-19 poses major challenges to emerging-market economies (EME). The spread of the disease finds them with worse living conditions and less resources. EMEs remain heavily exposed to spillovers due to dependence on capital inflows, commodities and remittances. Economic informality, limited social safety nets, and shallow financial markets limit the effectiveness of shock absorbers and policy responses. 8. Yet not all EMEs are the same. Some face this crisis with stronger fundamentals, broader policy space and more credible and effective institutions. 9. Chile has been hit hard by the pandemic. The first cases emerged in early-March and contagion seemed to stabilize by end April, only to rapidly escalate over the last month and a half. The country is now in its 15th week of the pandemic, with 250.000 confirmed cases and active cases stabilizing again. While Chile currently stands 8th in number of cases in the world, mortality rates remain low and testing broad, thanks to its stronger health system compared with other EMEs. 10. The spread of contagion has led authorities to adjust their NPC strategies. This has included stricter and broader quarantines, which have grown from 20% of the population in April to 49% these days.