toward regional cooperation will continue to increasingly focus on enhancing regional trade and investment linkages to maximise the comparative advantage of each member country. toward this end, studies have already been commissioned to explore the feasibility and identify the preconditions for the creation of an asian common market, a logical long - term objective of regional cooperation. ten, strong underlying economic and financial fundamentals the underlying fundamentals in the region are expected to continue to remain positive. sustainable current account surpluses and strong international reserves positions all continue to support the growth prospects. the high savings rate, of between 20 - 45 %, which allows for financing of pro - growth policy measures from domestic sources will continue to support the growth prospects. unemployment in the region as a whole is also relatively low. financial stability has generally been restored and there has been a resumption in credit growth. the financial sector as an enabler of growth in asia : the vital role of the banking system in facilitating the economic growth process ladies and gentlemen, the banking sector in particular and the financial sector in general have an important role in facilitating the growth process. the financial system in emerging market economies represents an important means to an end. for emerging market economies, the financial sector is an important enabler of growth. it is therefore important to embrace the long - term agenda of the economy. despite the trend of the increasing significance of alternative means of financing, the banking sector in emerging market economies will for some time to come remain the most important source of financing in the economy. the banking system therefore needs to effectively and efficiently perform its intermediation function. of importance, is the need to recognise the on - going economic transformation that is taking place in the region and to facilitate a more balanced growth between domestic and external sources of growth, between public and private sector - led growth, between the balance of consumption and investment, and between the different sectors of the economy, regions and communities within the country. facilitating a more balanced growth will contribute toward sustainability of the growth process. with new areas of growth emerging, and new business models being adopted, new and more differentiated customer requirements need to be met. the level of innovation will need to be accorded increasingly important attention. while for the most part, pricing for products and services need to reflect the costs and risks, the industry needs to recognise that in emerging market economies, the basis to do so should take into account the social agenda that is an integral part of the sustainable performance of the country. the ability to

the first significant step in regional financial co - operation and integration, and augurs well for the future development of the asian regional bond market. the asian bond market will not only serve to facilitate the re - investment of a portion of asia ’ s reserves back into the region but what is equally important is that it allows for the efficient allocation of savings for productive investments and at the same time broadens and deepens the regional bond markets. in the process, the level of corporate governance in the region would be enhanced as well. indeed, developing such an alternative source of financing would serve as a more resilient source of long - term financing with improved matching of the currency and maturity profiles of assets and liabilities. finally, institutional investors with longer - term liabilities would benefit from reduced currency risk by purchasing longer - term bonds denominated in their home currency. this would contribute towards diversifying risks arising from borrowing in foreign currencies, reducing the potential for systemic risk in the financial system. at this juncture, there is still much potential for improvement in the regional corporate bond markets. certain countries have taken measures to develop their bond markets with varying degrees of progress with efforts focused on strengthening the market infrastructure, establishing benchmark yield curves, augmenting the number of issuances and new instruments, and further liberalizing markets to enhance foreign participation. this has resulted in the evolution in the roles played by commercial banks. in the process of developing corporate bond markets, commercial banks are becoming increasingly active as investment bankers, with roles as corporate advisors, major issuers, deal originators, underwriters, dealers, brokers and providers of a broad range of risk management and hedging instruments. such an evolution follows the sequence in developing deeper, more active and increasingly integrated and competitive financial markets. in the pursuit to develop regional bond markets and options for raising capital, new mindsets of looking at regional and global capital markets and a broader range of tools in managing risk and hedging need to be adopted. in this environment regulators have directed efforts at increasing transparency, competition and strengthening the market and legal infrastructures. these efforts, coupled with asia ’ s history of enterprise and value creation augurs well for asia as a region. conclusion ladies and gentlemen in conclusion, prospects for asia continue to remain positive. asia can expect to continue to remain the fastest growing region in the world. the economic and financial sectors in the region have now strengthened significantly and are better positioned to mobilize the