Challenges still remain. For example, we have to work out and implement efficient solutions across countries that have different start points, practices and regulatory frameworks. But it is encouraging that governments are more seized with this problem, and more ready to collaborate with one another, than ever before. Singapore has taken the lead in several of the regional initiatives. Financial institutions here should also take part actively. This is the time to engage regulators and government officials in the region, to enter their growing markets and position yourselves for the business opportunities that the initiatives create. As a leading foreign exchange centre with a critical mass of global fixed income and equities expertise, Singapore can service international investors operating in Asia. Our market is well placed to facilitate the hedging activities that are essential for risk management and improving market efficiency. BIS Review 39/2004  5  These will complement the domestic markets in the countries of the region. Our strong legal system and the availability of international legal expertise and product structuring teams equip us to structure complex cross-border transactions. The growing wealth management industry will also generate a steady source of funds for regional investment products. Human capital A major issue that concerns all parts of the financial sector is human capital. A distinguishing characteristic of a successful financial centre is that it attracts talented and dynamic professionals from a broad range of disciplines and experiences. They make the financial centre what it is.

Singapore is already an established centre for managing Asian investments of global clients, and global investments of Asian clients. The strong growth potential of wealth management makes it an industry where Singapore is well placed to become a global player. The large increase in the number of HNWIs globally has also boosted demand for estate and trust planning. We are reviewing and modernizing the Singapore Trustees Act. MAS is also reviewing the Trust Companies Act, and will take over the regulation of trust companies. These steps will enhance Singapore’s position as an international trust domicile and widen the suite of wealth management services available here. We also need to build a larger pool of wealth management skills, and continue to increase the range of product offerings for wealth management clients. Capital markets Since the Crisis, countries in Asia have recognized the importance of developing their bond markets. While individual countries have made significant progress, their markets remain fragmented and small by international standards. We need closer co-operation among the capital markets in Asia, in order to integrate the markets and collectively increase their depth and liquidity. This will allow us to effectively recycle some of Asia’s huge reserves and attract more international investors to the region. Regional governments have therefore taken several initiatives to foster a regional capital market, covering both fixed income and equity. These address both supply and demand side issues, such as easing constraints to cross border activity, forging alliances and linkages among the exchanges, as well as establishing a regional infrastructure.