anchor currency for our region. this is a long - term possibility, but it would have the advantage of reflecting the strong trade linkages in the region. it would also create bigger and more liquid markets that are less susceptible to manipulation. it would also help address problems of intermediating financial resources within asia. at present, asia ’ s central banks invest massive amounts in foreign securities, particularly u. s. dollar assets, only to see volatile funds flow back to the region from overseas markets. by investing reserves directly in asian financial assets, this type of costly and unstable recycling through developed markets could be reduced. there are, of course, many obstacles in the way of creating an asian currency unit. the various economies of the region operate under widely differing economic regimes, and are at different stages of development. an institution would be necessary to administer the system, and the politics involved would doubtless be very complex. but i believe that now is a useful time to raise this topic for discussion, at least at an intellectual level : successful implementation in the longer term would go a long way towards addressing the currency instability we have seen in the region over the last year and a half. after all, it has taken the more homogeneous europe fifty years to bring the euro into existence. a further long - term solution lies in the development of stable and transparent debt markets in the region. the excessive reliance in asia on short - term financing from overseas lenders through weakly regulated banking systems, and all the turbulence that this has entailed, is a reflection of the lack of deep and diversified debt markets in the region. the essence of the problem is the failure of our financial systems to keep pace with the strong underlying growth in other sectors of the asian economies : the industrial and trade sectors surge ahead, while the financial sector lags behind. too large a share of asia ’ s financial resources has consequently been recycled through overseas markets, with the inevitable loss of information flows, and a tendency towards the kind – 9 – of market volatility that has caused us such problems. we need to establish local debt markets that bring both borrowers and lenders into more direct and long - term relationships, and which leaves both sides less exposed in terms of currency and maturity mismatches. ironically, the underdeveloped state of our debt markets is attributable in part to the traditional absence of large budget deficits in most of the region, which has limited the development of government bond markets. debt market development

eddie yue : opening remarks - hong kong academy of finance 5th anniversary and financial leaders programme graduation ceremony opening remarks by mr eddie yue, chief executive of the hong kong monetary authority, at the hong kong academy of finance 5th anniversary and financial leaders programme graduation ceremony, hong kong, 13 december 2024. * * * a very warm welcome to all of you for joining us today to commemorate the 5th anniversary of the hong kong academy of finance ( aof ) and the 3rd financial leaders programme graduation ceremony. back in 2018, with the financial industry becoming increasingly globalised and complex, the financial secretary tasked the hong kong monetary authority ( hkma ) to commission an experts group to consider how to further enhance hong kong's " soft power " as an international financial centre ( ifc ). the experts group concluded that cultivating this " soft power " in practice required a robust talent pool in leadership ranks and a strong local research base to further elevate hong kong's competitiveness and profile as an ifc on the global stage. with this in mind, the aof was established in 2019 as a collaboration among the four financial regulators in hong kong, namely the hkma, the securities and futures commission, the insurance authority, and the mandatory provident fund schemes authority. the mission of the aof was twofold : ( i ) to serve as a centre of excellence for developing financial leadership ; and ( ii ) to act as a repository of knowledge in monetary and financial research, including applied research. three aof fellows – norman [ chan, senior adviser of the hong kong academy of finance ], moses [ cheng, non - official member of the executive council ], and tony [ neoh, co - chairman, the asian academy of international law ] – who played a significant role in conceptualising the idea of the aof, are here with us today, and will share their insights on the aof's progress in achieving its strategic objectives in a panel session later. before that, let me first share a few observations. in fact, the aof was born during a rather testing time back five years ago. right after its launch, hong kong faced a series of challenges from social unrest to the global pandemic. but through these adversities, the aof managed to stay nimble and innovative, and still succeeded in making meaningful progress across several key areas. firstly, the aof has built up a strong and diverse membership base comprising nearly 400 senior executives from across the financial