of gdp or skr 135 billion. 2 conversely, an appreciable reduction of unemployment implies decreased social tensions as well as substantial economic gains. calculated in the same way, halving registered unemployment from 8 to 4 per cent, for example, would confer an estimated long - term gain in production of 4 per cent of gdp and strengthen government finance by as much as over skr 50 billion a year. simple calculations of this type are obviously uncertain but they do serve to illustrate the sort of economic benefits that may be reaped from an appreciable fall in unemployment. what can the riksbank and monetary policy do? there was a time when many people believed that the problem of very high unemployment could be tackled with a generally expansionary economic policy. lower interest rates, devaluations or fiscal stimuli were seen as instruments for boosting demand, raising production, improving employment and thereby lowering unemployment. even today, advocates of similar views are not uncommon. as the consolidation of the budget places constraints on fiscal policy, attention concentrates on monetary policy. representatives of this line argue that the problem of unemployment could be solved if only the riksbank had a wider objective than combating inflation. some say that the riksbank ought therefore also to have explicit goals for growth, employment and unemployment, goals that should be as important as keeping inflation under control. you will hardly be surprised to hear that i do not share such opinions. the current situation in the labour market is more complicated than that. an expansionary economic policy, aimed at boosting demand above the economy ’ s long - term production potential, would actually be liable to worsen the labour market situation in the longer run. inflation would move up and the economy would function less well. neither is it the case that higher inflation would generate permanently higher employment and lastingly lower unemployment. let me give you an example. suppose inflation is 2 per cent initially and monetary policy is given an expansionary turn that disregards the sustainable level of output. if wage agreements have been concluded for a considerable period, an upward shift in inflation to, say, 5 per cent could in the best case contribute to a short - run increase in employment because firms ’ real wage costs are reduced. in time, however, 5 per cent inflation will be perceived as normal and wage demands will be pitched accordingly. with higher nominal wage increases, real wage costs will rise again and unemployment will tend to return to its initial level. a renewed attempt to

halal profits. towards sustainability : the role of islamic finance islamic finance value propositions not only are consistent with universal and ethical values, but the economic aspirations are to elevate our overall well - being. much of today ’ s discussion focus on as sustainable development goals ( sdgs ) and sustainable responsible investments ( sris ) that centre on impact - driven and value - added outcomes, in addition to being commercial2 / 3 bis central bankers'speeches oriented. on this note, malaysia is at the forefront of innovation and thought leadership with the value - based intermediation ( vbi ) initiative that aims to create positive and sustainable impact to the economy, community and environment, without compromising the financial returns to shareholders. our vbi journey has hit several key milestones. to date, 12 islamic banking institutions have pledged to integrate environmental and social considerations in their offerings, practices and cultures. in facilitating this new journey, bank negara malaysia will continue to collaborate with the industry to create an enabling environment for smooth and orderly transition. these include the issuance of several guidance documents such as the vbi implementation guide, vbi scorecard and value - based impact assessment framework ( vbiaf ). more recently, the bank and the vbi community of practitioners ( cop ) have embarked on efforts to develop sectorspecific guides on value - based impact assessment alongside sectoral experts. to start with, the focus of these efforts will be on renewable energy, efficient energy, and primary commodities. this year also witnessed the launch of an islamic index - based investment scheme, which has embedded environmental, social and governance ( esg ) principles, and the launch of working capital financing for women entrepreneurs. in the same vein, the takaful sector is also moving towards integrating vbi elements, with the establishment of the vbi takaful task force by the malaysian takaful association ( mta ) to look into establishing a strategic roadmap on vbi implementation by the takaful industry. success of these initiatives require conviction and commitment by the industry leaders to actively pursue these as an important agenda for islamic finance. therefore it is imperative that the industry leadership to also support this with talent development strategies to equip the islamic financial institutions with the right talent pool. these include re - evaluating and refining the learning and development requirements, anchored at incorporating new learnings and more understanding of businesses that translate into value - added services to clients and addressing gaps in skills and competencies required to