region through observance of the insurance core principles as an important precondition for more integrated insurance markets. this process has been supported by the asean insurance regulators forum and its training arm. going forward, progressive liberalisation of the insurance sector in the region will be guided by the asean insurance integration framework. in this regard, asean members have agreed to prioritise efforts to liberalise the cross - border supply of marine, aviation and goods in international transit ( mat ) insurance and to support the establishment of an asean disaster risk financing and insurance ( drfi ) mechanism. progress in these areas will enable asean members to increase capacity for such risks which are growing in scale and complexity, and achieve broader diversification of risks across the region, leading to lower costs of insurance. it will also enhance the protection of asean communities and economies against increasing exposures to catastrophes. significant progress has also been made in promoting freer flow of capital and greater connectivity between the asean capital markets through the various initiatives and measures by the asean capital markets forum. market participants can look forward to more seamless cross - border investments with reduced costs and greater access to asean investments. financial integration initiatives are also focusing on harmonising further the operating environments for payment systems within asean countries. a key outcome is to create an efficient, reliable and secure payment and settlement system which is able to operate smoothly across asean. consumer transactions such as cash withdrawals and payments for goods and services will be further simplified, contributing towards the growth of retail businesses in asean economies. the development of more convenient and cost effective retail payment systems can also help realise the full potential for e - commerce in asean. efforts are also underway to promote the use of asean currencies for trade settlement. this will diversify the use of currencies by importers and exporters. the use of domestic currency for settlement of trade reduces the exposures to currency risk and costs associated with the need to hedge against such risks. collectively, these initiatives bis central bankers ’ speeches are expected to contribute towards further deepening trade and financial integration in the region. priorities going forward with the developments described just now, in moving forward, we can expect the financial integration process to continue to gather momentum. to my own mind, an important question for policymakers and financial institutions is where should we focus our attention and efforts to adapt to the changes ahead? while further financial integration process has captured the imagination of many, because of the numerous benefits and opportunities, at the same time, policymakers

the cohesiveness, the sense of purpose and urgency of the g20 did indeed contribute to restoring confidence in the global financial system and the coordinated policy stimulus was an important catalyst for the economic recovery. in recent months, however, the momentum for this coordinated actions have dissipated and there have been differing positions on several important issues. at the same time, a number of the major crisis affected countries have implemented their own financial reform plans. in view of the far reaching implications of any reform agenda, it is an important global responsibility to ensure that the reforms achieve their intended results and that this new phase of globalisation will result in a more inclusive international financial system that will allow for the effective participation in the global economy and international financial system regardless of size or stage of developments. on the specific regulatory reforms to address the issues and problems that caused the crisis, of importance, is that the goal of such regulatory reform should not be overlooked – promoting financial stability is a means to an end and the ultimate goal is to achieve sustainable growth and development. many have already highlighted the potential increased regulatory costs on intermediation and hence on economic activity. this is even more relevant in asia where there is greater reliance on the banking sector for financing. the efforts undertaken to comprehensively assess the macroeconomic impact including by the iif is highly relevant and will be important to the reform process. a further concern and one that is less discussed is on the implementation of the regulatory reform. with greater capital mobility across borders, the stricter regulations could result in the migration of financial business to less regulated market segments, institutions or financial centres. important to this is the need for the development of the framework for cross border policy coordination and resolution. in asia, efforts are underway to address these specific issues recognising that in this interconnected environment, the execution of remedial and containment measures will be highly complex and challenging. focus is also being given to having enhanced surveillance and oversight that is complemented by a robust framework for governance, transparency and accountability. given the strong presence of international institutions in the asian region, we have strong interest in the establishment of an effective cross border resolution mechanism so that any failure of such large and systemically important institutions with cross border representations can be dealt with effectively in an orderly manner. this will require cooperation and coordination across countries, taking into consideration their differing regulatory and legal systems. a further priority in emerging asia is the promotion of responsible market practices and consumer protection given the stage of development and level of financial