, we have a policy of discouraging the internationalisation of the s $. however, we recognised that the trade - off was a less vibrant capital market, particularly the debt market. so we have progressively relaxed the specific restrictions over the past six years, while maintaining the intent of the policy. the results have been positive. the non - internationalisation policy is now down to two basic safeguards to discourage speculation in the s $ - banks may not lend s $ to non - resident financial institutions in order to speculate on the s $, and non - resident borrowers who raise s $ through bank borrowings or on our capital markets must swap or convert these s $ to foreign currencies before remitting them abroad. this stance remains appropriate, and continues to underpin the effective conduct of our monetary policy. nevertheless, there is scope for further fine - tuning. we have decided that non - resident, non - financial issuers of s $ bonds and equities will no longer be required to swap or convert their s $ proceeds into foreign currencies before remitting abroad. non - resident, financial issuers of bonds and equities will still have to do so. this will give the issuers greater flexibility in managing their s $ funds. in addition, mas will exempt from the restrictions under the policy, any extension of temporary overdrafts of s $ vostro accounts to prevent settlement failures. this will facilitate straight - through processing and more efficient handling of s $ payments. with the progressive relaxation of the s $ restrictions, the current policy essentially limits only lending of s $ to non - resident financial institutions for the purpose of speculating in the s $, and does not specifically seek to prevent the internationalisation of the s $. the present label : “ non - internationalisation of the s $ ” may suggest that singapore restricts foreign participation in s $ markets, which we do not do. we have therefore also decided to rename the policy " lending of s $ to non - resident financial institutions ". conclusion asia has had a remarkable recovery and can now look forward to a period of renewed growth and prosperity. financial markets will play a major role in this process. despite some strategic and security risks in the region, the political situation is generally stable and positive. there are challenges ahead, but with greater regional collaboration and integration, and continued reforms and developments to financial sectors in individual countries, asians, and investors in the region, can

regional financing arrangement through the chiang mai initiative. these initiatives are significant not only for their tangible economic benefits, but also as symbolic demonstrations of the collective interest in regional financial cooperation. alliances among asian exchanges another area with potential for regional financial collaboration is in the securities and futures exchanges market. in us and especially in europe, a wave of consolidation among leading exchanges has resulted in mega - exchanges that have the economies of scale to make investments in advanced infrastructure, offer competitive fees, and most importantly provide investors and issuers with the liquidity that they seek. exchanges in asia have thus far been largely insulated from the trends of consolidation. asian stock markets are generally smaller in size and less liquid than those in more developed countries. to remain relevant to international investors in this changing landscape, regional exchanges should deepen their collaboration with one another. the decision of the recent asean finance ministers ’ meeting to explore alliances and linkages among asean securities markets will catalyse and encourage this collaboration. regional exchanges are already taking the first steps. the singapore exchange, sgx, for instance, established a co - trading linkage with the australian stock exchange in 2001. it is in discussions with tokyo stock exchange on a possible alliance, and has recently started talks with bursa malaysia, formerly the kuala lumpur stock exchange, on possible collaborations. pressing on with reforms at the national level while pursuing regional initiatives, individual countries need to press on with reforms at the national level. although many asian countries have significantly strengthened their financial systems, they still need to follow through with reforms in the financial and corporate sectors. singapore ’ s financial system was lucky to emerge from the asian crisis relatively unscathed. during the crisis, we undertook an extensive liberalisation program aimed at deepening and broadening capital markets, consolidating and upgrading the local banks, and enhancing singapore ’ s position as an international financial centre. at the same time, we put in place a new supervisory framework to oversee financial institutions, shifting from one - size - fits - all regulation to more risk - based supervision. our efforts have achieved encouraging results. our debt market has grown three - fold since 1998 to reach s $ 90 billion in 2002, driven by growing demand in the region for debt financing. our wealth management industry more than doubled in the same period, with total assets under management growing from s $ 150 billion in 1998 to s $ 344 billion in 2002. in treasury activities, we have maintained our position as the fourth largest fx centre in the world, with