. here our approach is to liberalise in a phased manner so as to inject more competition and spur the stronger singapore banks to upgrade and compete, and not to put off liberalisation while waiting for smaller players to become strong and confident enough. we introduced the first banking liberalisation measures two years ago. we are now finalising a second banking liberalisation package, which we will announce at the end of this month. promote key markets and activities finally, we are actively promoting the development of specific markets and activities, which have stronger growth potential. an example is the wealth management industry. another example is the debt markets, which until recently were underdeveloped all across asia. however, we should focus our resources first on activities where we have a natural advantage, or can build up a capability. we must push in the same direction as market forces, and not against them. our main approach to developing the financial centre should therefore be to establish a level playing field with transparent rules and the right environment, so that market forces can operate and innovation can flourish. active promotion of specific activities complements this. conclusion the major changes in the financial industry compel financial centres to adapt and evolve, or else be bypassed and rendered irrelevant. singapore aspires to be one of the financial centres in asia, and a node in the global network of financial markets. by implementing the right policies and strategies vigorously, we hope to develop and grow as a financial centre, serving asia and contributing to its development and prosperity.

lee hsien loong : credibility, confidence, dynamism : mas in the new economic and financial landscape address by mr lee hsien loong, deputy prime minister of singapore and chairman of the monetary authority of singapore, at the mas 30th anniversary conference, singapore, 20 july 2001. * * * introduction it is a great pleasure for me to welcome you to mas ’ 30th anniversary conference. we are honoured to have with us so many distinguished central bankers, financial supervisors, market participants and economists. a new economic and financial landscape is emerging. financial markets are becoming globalised ; cross - border capital flows are larger and faster ; financial institutions are consolidating and restructuring on a massive scale ; and new and complex financial products are emerging, driven by technology and market pressures. amidst these upheavals, mas ’ goals as a central bank remain unchanged : low inflation for sustained economic growth, and a sound financial sector for markets to grow and thrive. mas is a unique organisation – it is the only institution in the world that combines responsibility for monetary policy with supervisory oversight of the entire financial sector – banking, insurance and securities. in addition, it has the task of promoting the development of singapore as an international financial centre. i shall describe how mas has met its responsibilities in these three areas over the past 30 years, some of the key events that have shaped our policies, and how we intend to move forward in the new economic and financial landscape. building confidence and credibility monetary policy mas was born in turbulent times. it was 1971. the us dollar was under intense pressure, due to mounting inflation and balance of payments problems brought on by the vietnam war and great society programmes. in august 1971, just months after mas was formed, the us suspended convertibility of the us dollar into gold, plunging international currency markets into turmoil. in june 1973, the bretton woods system of fixed exchange rates finally collapsed, and the singapore dollar was floated. having witnessed these tumultuous events and the instability they caused, the singapore government enshrined a strong and credible currency as one of the key pillars of macroeconomic policy, and charged mas with the responsibility of ensuring it. tight fiscal discipline, a healthy balance of payments, and a vibrant singapore economy underpinned the steady strengthening of the singapore dollar. a second defining moment in the evolution of mas ’ monetary policy came in 1981 when global inflation accelerated in the wake of the second oil shock. dr goh keng swee, who took