sukhdave singh : the rise of the south at a crossroad – a view from east asia and latin america opening address by dr sukhdave singh, deputy governor of the central bank of malaysia ( bank negara malaysia ), at the world bank knowledge and research hub conference “ the rise of the south at a crossroad : a view from east asia and latin america ”, sasana kijang, kuala lumpur, 16 may 2016. * * * i am pleased to welcome you to today ’ s conference on “ the rise of the south at a crossroad : a view from east asia and latin america ” organised by the world bank knowledge and research hub in kuala lumpur. for those of you who have not been here before, i would also like to welcome you to sasana kijang. i congratulate the world bank knowledge and research hub for organising this conference on economic integration. economic integration within the current global context it is indeed an opportune time for us to look at economic and financial integration and what it can offer to emerging economies in asia and latin america. it is an opportune time because the world seems to have been unable to bounce back towards a healthy growth path after the financial crisis in the developed world. it is an opportune time because policymakers have not been successful in generating strong sustainable growth. the traditional tools for nursing the economy back to health don ’ t seem to be working as well – possibly because of overuse or misuse. a pedantic approach to monetary policy in much of the developed world has led to near zero and negative interest rates in many of these economies. yet growth has remained stubbornly weak. such policies also risk merely creating the transfer of growth across time rather than promoting sustainable growth over time. it is perhaps time to start asking whether the best way to recover from the blow - out of one debt bubble is to create the conditions for another. central bankers and financial markets seem to be caught in a cycle of brinkmanship and central banks are caught in a trap of their own making. the outcome has been almost a decade of worsening financial repression, the progressive build - up of risks in the global financial markets, accompanied by weak investment and weak growth. it is clear that the lessons of the financial crisis have not been fully learnt in these economies – not by the financial markets and not by the policymakers. similarly, fiscal policy is supposed to be a tool that should be useful

i will conclude with my view of the role of integration for malaysia. since the financial crisis, malaysia ’ s growth has become more dependent on domestic demand and less dependent on external demand. while the resilience of domestic demand in the challenging environment is a noteworthy achievement, the reduced contribution of the external sector has clearly pushed malaysia on to a lower growth trajectory. since 2007, the contribution of net exports to real gdp growth has been negative with the sole exception of 2014. over the longer term, the contribution of the external sector will need to expand to support a healthy and sustainable economy. therefore, for malaysia, economic integration and strengthening our economic ties with other countries is a necessity. preferential arrangements such as trans - pacific partnership agreement, the regional comprehensive economic partnership and asean free trade agreements have a critical role in spurring productivity growth, accelerating structural reforms and creating a diversified, competitive and resilient malaysian economy. once again, welcome to this conference, and thank you. bis central bankers ’ speeches