The central banks in the SAARC region also have the ability to play the leadership or catalyst role by providing policy directions, preparing roadmaps in consultation with other stakeholders and guiding national and regional payment system reforms and taking the responsibility to develop a common payment policy framework acceptable to all countries in the region. We need to pay attention to the existing regional clearing mechanisms as well. As in the case of the Asian Clearing Union (ACU), if there are delays in processing payment instruments, combined with official accounting practices for payments that give rise to a float on the balance sheets of the central banks, that will contribute to inefficiency and uncertainty in the payment process. It is significant to note that such inefficiencies can extend to the central bank’s monetary operations and liquidity estimates as floating ACU balances cannot be treated as part of the international reserves of member central banks. Lack of clarity about rights and responsibilities regarding funds on the move is another shortcoming, especially where processing systems and accounting procedures result in long delays between the time a payment instruction is issued and the time it is cleared and settled. Both at national and regional level, supervision and oversight of payment systems have always received less attention compared to the supervision of banks and financial institutions. When there are cross border payments and common clearing and settlement mechanisms, it is important to ensure that there is a well-designed supervisory system.

Our economy is the seventh-largest in the world and the region’s growth continues to surpass that of advanced economies. Such progress has enabled and nurtured our own regional champions, many of which have moved ahead to do even more for the ASEAN people. Indeed, ensuring that the gains from ASEAN’s development are equitably shared by all is no small feat. It requires more than just government action. It entails close, continuous and committed partnerships with the private sector. Advancing the ASEAN potential (a) Significance of private sector Public-private partnership is part of the ASEAN DNA. Policymakers acknowledge the private sector’s significant role in driving shared prosperity among ASEAN. This is evident in the way financial institutions; airline companies; telecommunication; retail; and other private players have been expanding their businesses beyond domestic boundaries, creating greater employment opportunities and improving living standards in the region. In the aviation industry, for example, our regional low cost carriers have significantly increased interconnectedness among ASEAN countries. The economic spillovers from this increased connectivity cannot be ignored. By opening up access to Lombok, for example, these low cost carriers have contributed to a surge in tourists, marking the fastest growth of tourist arrivals in Indonesia. This has incentivised the Indonesian government to provide more infrastructure development, including solar power plants, water treatment facilities and roads. This is only one of the many other success stories from our regional home-grown champions. It is my hope that we keep nurturing more, and that their footprints in ASEAN bring even greater benefits to our people.