However, despite the considerable progress in financial integration in Asia, it is still low compared to the European Union-16 (2007: 56% as a share of total portfolio investment). Asia going forward The current global crisis, considered to be the most severe in the post-World War II period, has revealed weaknesses to the current global system. In the aftermath of the crisis, the global economic and financial landscapes are expected to change significantly. While signs of stabilisation are now emerging, prospects for recovery in the advanced economies are expected to be gradual. The general consensus is that the emerging economies in Asia, in particular China and India, will lead the global recovery moving forward. Several structural factors will support growth in Asia, including the growth-enhancing reforms and greater regional integration that have been undertaken in the recent decade. In addition, Asia's relatively strong and resilient financial systems, which have remained relatively unaffected in this current global financial crisis, are in a sound position to provide financing to support domestic economic activity. Indeed, this trend will accelerate the formation of more multipolar global landscape in the future. For continued progress and development, the strategies for Asia are adapting to the changing landscape; leveraging on regional strengths and addressing current weaknesses and future risks. Two key principles have contributed to Asia's earlier success, namely the regional and global integration of the economy and inclusive development. Asia has always embraced openness. While greater integration beyond national borders will likely continue, the pattern of integration will change.

Cloud computing and the use of third party services also have the potential to undermine firewalls. Putting a balance to the needs of various parties would be a challenging task. As information technology grows, so do the capabilities of cyber criminals. These criminals have a wide range of tools to execute cyber attacks, many of which are easily obtainable and relatively inexpensive to procure. For example, cyber criminals can now control networks of compromised computers through “botnets” that enable anonymity. This access can be bought or rented online. In the hands of criminal or organisations that are determined to  BIS central bankers’ speeches  1  disrupt national stability, botnets could be used to steal sensitive data or disrupt access to critical national infrastructure. Industry players, security firms and financial supervisors may easily find themselves in a cat and mouse game, where the ability to attack constantly outpaces the ability to defend. These challenges demand a stronger and forceful response by all parties. Recent global regulatory reforms, such as the Basel III capital adequacy and liquidity rules, have tended to focus on financial risks. There has been much less focus on technology and cyber security risks despite the real systemic threats that they pose. So far, no financial institutions in this region have encountered an attack, severe enough to disrupt its critical services or cause material losses, but we cannot leave this to chance.