increasing international trade and competition is one important reason for the slow rise in prices in that period. high labour force growth, partly owing to labour immigration, has also had a dampening impact on wage growth in many countries. these drivers may be changing direction. we saw signs that globalisation was slowing down even before the pandemic. the pandemic may also have amplified a trend whereby an increasing number of businesses see the need to secure their own supply lines and locate more of their production chain closer to their customers. at the same time, labour supply is growing more slowly in advanced economies as the population ages. the period where some countries struggled with too low inflation appears to be over, and central banks may be facing more demanding trade - offs between meeting the inflation target and supporting employment. volatility in the value of the sovereign wealth fund must be taken into consideration norges bank economic perspectives 17 february 2022 alongside its central banking tasks, norges bank has another important mission, namely the management of norway ’ s sovereign wealth held in the government pension fund global ( gpfg ). since the first capital transfer in may 1996, the gpfg has grown larger than anyone had imagined ( chart 9 ). and the investments have paid off handsomely. cumulatively over the entire period, we have now earned more on investments abroad than the transfers to the gpfg. we have more than doubled our money. chart 9 the money is more than doubled gpfg. in billions of nok total value deposits returns petroleum revenue spending exchange rate – 4000 – 4000 sources : ministry of finance and norges bank the fiscal rule ties petroleum revenue spending to the value of the gpfg. as its value has increased sharply, petroleum revenue spending has followed suit ( chart 10 ). in the years prior to the pandemic, one krone in six of government expenditure was covered by the gpfg. chart 10 the gpfg finances a large portion of government expenditure structural non - oil deficit as a share of government expenditure. percent sources : ministry of finance and norges bank as a nation, we are in a fortunate position thanks to our strong public finances. but substantial government wealth also entails challenges that must be addressed. more than 50 years as an oil nation have taught us an important thing : oil prices are volatile. this is why it was important to establish the petroleum fund mechanism and the fiscal rule. we have succeeded in shielding government budgets from widely fluctuating oil revenues

in asian economies, japanese manufacturing firms have been increasing local production. japanese firms also have been focusing on local consumers in a wide range of businesses, including retail and other services. in response to these developments, japanese banks have been making efforts to further localize their asian business. for firms expanding their businesses in asia, securing stable funding in the local currency is becoming a challenge. to meet this challenge, it is important to establish ways in which firms can obtain local funds from banks. development of domestic financial markets can provide banks with stable access to liquidity and underpin their provisioning of funds to firms. this will not only contribute to stabilizing the domestic financial system in asian economies, but also create a virtuous cycle encouraging the entry of more global firms and the localization of their businesses. the challenge for central banks is to nurture a sound banking system that ensures secure funding and fosters liquid interbank markets. the availability of local currency funding differs across countries, depending on the stage of development of money markets and of funding tools using collateral. the bank of japan has agreed on cross - border collateral arrangements with other asian central banks as one of the backstops for developing financial markets in this region ( chart 3 ). for example, with the bank of thailand, the bank of japan has already established a framework providing thai bahts to financial institutions against japanese government securities and japanese yen as collateral. in running a regional safety net, it is important to monitor carefully the regional financial and economic conditions. it is also necessary to share relevant information among the region ’ s countries in a timely manner. information on macroeconomic policies and the challenges that each country faces should be exchanged on a regular basis. at the same time, it is essential to create a network of swift information sharing and rapid response to sudden changes in international financial markets. to help strengthen such cooperation among central banks, the bank of japan has been actively participating in the executives ’ meeting of east asiapacific central banks ( emeap ), together with the bank of thailand and other asian central banks. bis central bankers ’ speeches concluding remarks compared with european countries, asian countries are much more diverse in terms of their economic and social makeup, so that the challenges of managing the economy vary significantly. at the same time, however, asian economies face challenges similar to those of other economies, including the advanced economies. therefore, active discussion in the region to share the experience and wisdom in asian economies can also be beneficial to other regions