balance sheets. among the factors that will shape the ecb ’ s approach to exiting the nonstandard measures are the following : • first, we will act with the aim of securing price stability in the medium - term. by implication, any non - standard measure that may pose a threat to price stability will be promptly withdrawn. if no such risk exists, a measure can be maintained in case of significant financial - market tensions. • second, we have built a degree of phasing out into the exit process through the design of our measures. in the absence of new policy decisions, several of these measures will unwind naturally, for example, through pre - determined termination dates. • third, the ecb ’ s operational framework comprises a broad set of instruments so that the exit strategy can be formulated in a flexible way. for example, the interestrate corridor allows short - term interest rates to be changed while keeping some nonstandard measures in place should the need arise. therefore, the governing council can choose the way in which interest - rate action is combined with the unwinding of the non - standard measures. let me turn to the issue of the exit from expansionary fiscal policies. in my view, an important medium - term risk to sustained recovery revolves around deteriorating fiscal positions. the large increases in fiscal deficits and public debt incurred to provide stimulus to the economy have already raised concerns in financial markets, as suggested by the widening sovereign spreads relative to pre - crisis levels, for economies with large fiscal burdens. if the recovery were to stall, followed by a prolonged period of very - low growth, deficits and debt could swell to difficult - to - sustain levels. governments will, therefore, need to start addressing mounting long - run fiscal challenges by committing to large reductions in deficits once the recovery is on a solid footing and advancing reforms that will put public finances on a more sustainable path. i need to add that greece is among the euro - area countries for which the challenge of medium - term fiscal viability is especially urgent. financial sector regulation the best way to manage a crisis is to prevent it happening. at the root of the market failure that led to the crisis was optimism bred by a long period of high growth, low real interest rates, and policy failures. one such failure was that financial regulation was not equipped to address the risk concentrations and distorted incentives underlying the financial innovations. this circumstance raises another medium - run challenge. the present crisis has revealed that macro - pr

industry, for example, our regional low cost carriers have significantly increased interconnectedness among asean countries. the economic spillovers from this increased connectivity cannot be ignored. by opening up access to lombok, for example, these low cost carriers have contributed to a surge in tourists, marking the fastest growth of tourist arrivals in indonesia. this has incentivised the indonesian government to provide more infrastructure development, including solar power plants, water treatment facilities and roads. this is only one of the many other success stories from our regional home - grown champions. it is my hope that we keep nurturing more, and that their footprints in asean bring even greater benefits to our people. ( b ) role of financial integration 1 / 3 bis central bankers'speeches the private sector ’ s role in enhancing shared prosperity in asean must be facilitated by an enabling environment for efficient cross - border business transactions. this has been achieved through greater financial integration in asean including deeper banking integration ; smoother capital mobility ; and efficient payment and settlement systems. asean central banks have made significant strides towards this end, but by no means will we coast on by. we will continue to champion financial integration that benefits all. an asian development bank study in 2013 has shown that banking integration mobilises savings towards more productive investment, thereby increasing productivity and accelerating growth. this study also showed that smoother capital mobility will facilitate more competitive and productive cross - border lending and borrowing, while promoting financial sector and capital market development. lastly, an efficient cross - border payment and settlement systems promotes cost - effective transactions by reducing the cost of doing business. hurdles faced by asean like it or not, the path to achieving the strategic objectives of the asean economic community ( aec ) 2025 will be filled with hurdles. the pace of convergence within asean would be shaped by members ’ different levels of development. it is harder for countries with resource constraints to shoulder the high costs involved in undertaking structural and institutional changes, which are required for effective integration. in overcoming such hurdles, i stand proud in acknowledging that asean adopts a gradual and phased - in approach that ensures a win - win situation for all. to illustrate this, let me share with you an anecdote from asean ’ s financial integration experience under the aec. the core principles of our framework are inclusiveness and readiness. for example, under the asean banking integration framework, two or more asean countries can liberalise their banking sectors if they are mutually ready. but what if a member is not ready