, the profit sharing and risk sharing characteristics in islamic finance strengthen the incentives for the financial institutions to ensure the profits are commensurate with the risks being assumed. it is this form of finance that we would want to encourage. with this underlying foundations, efforts are being directed to build the domestic financial infrastructure. a challenge that is being specifically addressed is the development of an active secondary global sukuk market. in this regard, there has been a lack of trading in the secondary market especially in the usd sukuk market as the investors tend to buy - and - hold the instruments until maturity. this is largely due to the scarcity of the instruments in the market. in malaysia, the growing ringgit sukuk market has resulted in an active secondary market. this is largely due to the regular and varied issuances throughout the year. this is supported by the investment in research and development and in talent development to ensure the availability of expertise in the structuring of sukuk instruments and in sukuk documentation. having the potential to innovate new instruments will depend on having the necessary talent. this is an area of focus in malaysia to develop the skills, expertise and capability. the islamic financial system in malaysia now offers a wide range of financial products and services that are competitive and able to meet the changing requirements of the domestic and global economy. way forward for the global islamic financial system as we advance forward, we need to recognise the forces of change and the transformation taking place in the international financial system and global economy. relentless efforts have been initiated to reform the international financial system by the international community to address the weaknesses that have contributed to the recent crisis. in this environment, islamic finance needs to continue to evolve to remain effective and competitive. the islamic financial system does not exist in isolation and will continue to develop as an integral part of the global financial system. as part of efforts to ensure sustainability in this new and more challenging environment, a task force on islamic finance and global financial stability was formed by the islamic development bank ( idb ) and the islamic financial services board ( ifsb ). the report, which was completed in april this year, sets out eight areas that need to be further strengthened to bring the islamic financial system to a higher level of performance in this new economic and financial order that is emerging. a recommendation of the report is the establishment of an islamic financial stability forum ( ifsf ) based at the ifsb as a strategic platform for productive dialogues to promote

malaysian consumers and businesses. recognising the importance of having a payment system that is comprehensive and efficient to support the needs of the consumers and businesses in a high - income economy, the payment system infrastructure would be enhanced and more inclusive, capitalising on the advancements in technology as well as the high number of banking accounts and mobile phone penetration in the country. the focus will be on infrastructure developments necessary to provide the speed and efficiency while offering convenience to consumers and businesses. electronic payments should be the preferred medium for all economic transactions. this includes having the infrastructure necessary for industry - wide mobile banking and payment ecosystem, including an extensive outreach of the point - of - sale terminal facilities. the pricing structure and a comprehensive awareness programme to steer desirable payment behaviour are also key areas that will be addressed in our next phase of the development of our financial system. the blueprint will also seek to extend the reach to the potential untapped market represented by the latent demand for financial services among the non - urban population and urban residents in the lower income group. the blueprint will endeavour to develop a conducive environment for the design of financial products and services and the utilisation of delivery channels will effectively overcome the barriers to financial access, particularly cost restrictions and physical accessibility. with greater regional integration, we also see significant potential to leverage domestic strategies to create a strong regional footprint in the provision of affordable and commercially viable financial products and services. beyond domestic borders, asia ’ s continued growth and prosperity offers significant opportunities for the provision of financial services and productive investment prospects. an important thrust of the blueprint will therefore be to develop the financial infrastructure to enhance the linkages within the region. this will be facilitated through the continued process of financial integration and increased connectivity within the region, with greater liberalisation of the financial sector, the integration of payment and settlement systems, and greater crossborder cooperation in maintaining regional financial stability. central to the development strategies for the next decade is the consolidation of malaysia ’ s position as a leading international islamic financial centre. malaysia already has a strong brand affirmed by the growing importance of our sukuk market and the higher level of foreign participation in our islamic financial markets. this is reinforced by the diversity of market players and a comprehensive institutional framework for islamic finance. two landmark initiatives achieved this year is the establishment of the islamic financial stability forum ( ifsf ) and the international islamic liquidity management corporation ( iilm ). moving forward, islamic finance is expected to further accelerate