goh chok tong : building a brighter future for asia together keynote address by mr goh chok tong, senior minister of the republic of singapore and chairman of the monetary authority of singapore, at the nomura asia equity forum 2007, singapore, 4 july 2007. * * * welcome to singapore. i thank nomura for holding its fourth asia equity forum here, and for bringing together this diverse group of companies, financial institutions and investors. i hope that this forum will serve as a platform for forging new business relationships and conceiving new growth opportunities. last week, the world economic forum on east asia hosted more than 300 leaders from business, politics, government, civil society and media in singapore. the mood was upbeat. the overall feeling was that 10 years after the financial crisis, asia has emerged stronger and its growth built on firmer foundations. the belief was that despite some challenges ahead, asia would continue to rise. as leaders of governments and companies, we have to anticipate the future. i am not suggesting that we do this with a crystal ball but we should have a mental road - map of the terrain ahead. this will help us position ourselves to seize the opportunities, manage the risks and devise strategies for growth. this morning, i would like to share with you how i see asia ’ s regional architecture evolving, and how we are building a brighter future. i will take a medium term timeframe as i believe this is more relevant to business planning. asia ’ s share of global wealth let us start by taking a look at asia ’ s share of global wealth to see how far it has come, and where it is projected to go. back in 1980, asia accounted for 19 % of global gdp in ppp ( purchasing power parity ) terms. today, asia ’ s share stands at 35 %. in 2020, this is expected to rise to 45 %. compare this with america and the eu. each accounted for roughly 21 % of global gdp in 1980 and 2005. both are expected to see their share drop to 19 % by 2020. let us look at another measure. asia ’ s share of global exports in 1980 was 14 %. it doubled to 27 % in 2006. by 2020, this is expected to rise to 35 %. the picture is the same for asia ’ s share of global outward fdi ( foreign direct investment ) stock. in 1980 it was 5. 9 %. by last year, it doubled to 11. 4 %

regulations. finally, the success of exchange linkages is highly dependent on investors ’ interest in cross - border trades via the linkages. to achieve this, the linkages must provide a cost efficient solution for investors ’ trading needs. there is also a need to cultivate asian investors ’ interest in cross - border investments. asian investors ’ investment portfolios traditionally reflect a strong home bias. to help profile non - domestic securities and enhance investors ’ trading interest in these securities, regional exchanges could explore the possibility of cross - trading or cross - listing of securities, particularly in neighbouring exchanges where information barriers are low. more efforts should be taken to facilitate local and foreign investors ’ participation in our markets. however, investors ’ interest in cross - border trades is also in part, driven by their level of confidence in how markets are characterised by sensible regulation and high standards of corporate governance. enhancing corporate governance and regulation there has been much focus on the corporate governance and regulation of exchanges in many jurisdictions. as institutions of system - wide or systemic importance, the issues relating to the corporate governance of exchanges are for the most part similar to the issues for banks and insurance companies. weak corporate governance of such institutions can undermine public confidence in the financial system. however, unlike other financial institutions, exchanges perform varying degrees of supervisory and regulatory functions over their members and listed companies. potential conflicts of interests exist between these regulatory functions and the exchanges ’ commercial functions. these conflicts may be accentuated for demutualised and listed exchanges. while profits are not irrelevant to other exchanges, they are the primary motive for shareholders of listed exchanges. regulators worldwide have been grappling with these issues as more exchanges demutualise and list. mas believes that credibility in governance and regulation is a vital commercial asset for exchanges. investors are more likely to invest and trade on an exchange if they are confident that they can do so without being defrauded or without other investors having an unfair advantage. exchanges that operate fair, efficient and transparent markets, where rules are enforced in an impartial way, will have a competitive advantage. mas and sgx share a strong commitment to maintaining high standards of corporate governance. we take a collaborative approach in working together to continually keep abreast of best practices. no single model has gained universal acceptance, and no model is good for all time. we will continue to work closely together to further enhance the governance and regulatory arrangements relating to sgx where appropriate. conclusion east asian economies have seen robust growth in 2003.