total banking industry in the next ten years. on the other hand, in the middle east countries, especially gulf cooperation council ( gcc ) countries, the market share of islamic finance has expanded to go beyond 15 % headed by uae, bahrain, saudi arabia and kuwait. even, some of the local islamic banks have had overseas branches such as kuwait financial house, al rajhi banks, hsbc amanah, etc. it the financial express, bangladesh ( 23 may 2011 ) moody ’ s investors service bis central bankers ’ speeches reveals that the expansion of islamic banks is underway and right now countries like singapore, hong kong, china and japan have prepared themselves to establish the islamic finance industry. these are very interesting facts which could further enlarge the number of countries having islamic finance industries. with greater economic interdependency and convergency together with more open financial system and capital account regimes in many countries, the new financial system ( islamic finance ) have flourished and may become an important catalyst for growth and stability in many countries. for example, indonesia as a country with the biggest moslem population in the world has only started its islamic banking industry since 1992. with a liberal banking system regime and regulation, islamic banking industry has grown very fast and right now it has eleven islamic banks and 23 islamic windows including islamic foreign banks such as hsbc amanah, maybank islamic, and cimb niaga islamic. although its share currently is still trivial ( around 3 % ) compared with the conventional banks, the industry has shown its resiliency. furthermore, our research has shown that it has also positively contributed to the expansion of islamic banking and financial services throughout the country, and enabling more multiplier for future islamic financial development in the country. excellencies, ladies and gentlemen, besides the growing trend of islamic banks, another promising industry is the islamic capital market, notable sukuk market. it emerges in various countries in the middle east and asian countries. the recent global sukuk market has crossed usd134 billion in issuances and malaysia leads this market with 65 % market share followed by middle east countries with 26 % market share and the rest of the world. however, the tenor of the world sukuk market is dominated by short term sukuk tenor which is 55 %, while the long term tenor ( for example more than 10 years tenor ) is only 20 %. the sukuk market in indonesia is also progressing, with a nominal amount of usd6

burhanuddin abdullah : reflections on the changes in the region a decade after the asian crisis speech by dr burhanuddin abdullah, governor of bank indonesia, at the international symposium “ ten years after the asian currency crisis : future challenges for the asian economies and financial markets ”, hosted by the center for monetary cooperation in asia ( cemcoa ), bank of japan, tokyo, 22 january 2007. * * * honorable governor of bank of japan, mr. toshihiko fukui, honorable managing director of the imf, mr. rodrigo de rato, fellow governors, ladies and gentlemen, good morning. first i wish to join others to express our appreciation to thank the bank of japan for organizing this important event. it is indeed an opportune time to reflect on the recent developments and progress that we have achieved following the crisis. i believe that through a frank and candid discussion we can share from each others ’ experience during this symposium in the spirit of cooperation especially on how we have fared through the turbulence period of unprecedented economic crisis of the late nineties. we expect that we can capitalize on the recent progress and cope with the future challenges for the benefit of our economies. in this session, allow me to briefly express my reflection on the changes in the region a decade after the asian crisis to identify factors that would influence the economic dynamism and prospects of east asia in general and asean in particular. fellow governors, in my observation, i notice that a number of remarkable changes have occurred in the region. first is the heightened regional cooperation with the objective of establishing a regional self - help. unlike most of their counterparts in other parts of the world, the latest financial crisis, among other factors, provides strong impetus for the monetary and financial cooperation in east asia. the initiative to create a set of bilateral swap arrangement, to develop asian bond markets, and to conduct regional surveillance are our collective means to maintaining greater stability in the region, particularly in the face of highly volatile flows. i surely hope that this kind of cooperation will continue and be widened in the future so as to positively affect the economic dynamism in east asia. second, in the aftermath of the asian crisis, countries in east asia have become more conscious in protecting their own national interests and of strengthening their sense of security amidst greater global economic uncertainties. this is shown by the fact that countries in east asia have accumulated the bulk of the world's foreign - exchange reserves. in the past