the world in the light of the faster growth and stronger fundamentals of the region. so there seems to be no lack of appetite to invest in asia. the question is how to channel these funds to finance asia ’ s infrastructure investment needs. creating an enabling environment to facilitate private sector investment in infrastructure projects is crucial and fundamental. factors like certainty in government ’ s sector development plan, clarity in publicprivate partnership ( ppp ) framework, conducive legal, regulatory and institutional environment, and capacity to develop and implement projects are key to attracting private sector investors. adb has an important role to play in capacity building, and through its interventions, catalyse reforms and assist governments to develop an environment conducive for private sector investment. given the high degree of perceived risk of long - term infrastructure projects, public sector support is often needed to catalyse private sector investment. provision of credit enhancements and guarantees as well as ppp are common modalities of public sector support, and more work should be done to find new and effective ways to catalyse private sector investments. we are glad to see adb ’ s expanded efforts in mobilising private sector bis central bankers ’ speeches investment under strategy 2020. with the support of adb, the asean infrastructure fund ( aif ) established by asean is expected to help mobilise private capital as well as the region ’ s foreign exchange reserves for financing infrastructure projects in the asean economies. while the aif is newly set up and more time is needed to observe the effectiveness of this model, the aif represents a meaningful attempt by regional governments to cooperate and find new ways to mobilise public and private savings of the region to finance asia ’ s own infrastructure needs. we encourage further efforts in this regard, and adb, with its expertise and resources, is best placed to support such efforts. private sector infrastructure financing in the region has traditionally relied on international bank lending, particularly from european banks. with the european banks facing deleveraging pressure and retreating from the region, some asian banks have stepped in and increased their market share. however, there are questions as to whether asian banks can fully fill the gap. recent regulatory changes may also reduce banks ’ appetite in long - term project financing. given these circumstances, there are benefits to further develop the capital markets to complement bank financing and provide a channel to tap into other long - term institutional investors such as pension funds and insurers. policymakers in the region

##isation agenda, csd regulation and capital markets union let me now turn to the other initiatives surrounding t2s, namely the harmonisation agenda, the csd regulation and the capital markets union project. in addition to the concrete benefits brought about by t2s, a push has been given to the european post - trade industry to harmonise market practice, rules and standards. this is a market - driven process that will enable t2s to realise its full potential, in terms of efficiency and achieving a level playing field. the market is in the driving seat, but the ecb strongly supports this initiative and provides the secretariat function. the objective is to create a single rulebook for post - trade processes, which will help contribute to financial integration in europe. on the regulatory side, remarkable progress has also been made with the adoption of the csd regulation. this new piece of eu legislation complements the operational integration provided by t2s and gives further momentum to the post - trade harmonisation efforts. it has removed a number of the barriers to reaching a fully integrated market and is thus very much welcome. the next step forward will be the capital markets union ( cmu ), for which we have high expectations. if well designed and thoroughly implemented, cmu could bring significant benefits to the eu. t2s and the implementation of the csd regulation have already removed a number of the market infrastructure barriers. cmu has the potential to remove the remaining ones. beyond market infrastructures, the aim of cmu should be to integrate financial markets in such a way that investors and issuers of financial instruments have equal access to these markets, under equal conditions. similarly to the harmonisation agenda surrounding the development of t2s, cmu will require both market - led efforts towards greater harmonisation and legislative action to dismantle key cross - border barriers in a wide range of areas. this will help set the right framework conditions for these markets to develop and integrate. in fact, target2 and t2s show that genuine integration, rather than mere coordination, is essential to have well - functioning markets which can fully play their role in supporting the economy. thank you for your attention. i am now looking forward to our discussion. bis central bankers ’ speeches