regime, legal and shariah framework, and payment and settlement systems. in this decade, greater focus was particularly given to the institutional arrangements to develop the sukuk market. the sukuk market now accounts for more than fifty percent of our bond market. the market has drawn the participation from a wide range of international corporations and multilateral agencies in raising funds and investing in the sukuk issuances out of malaysia. more recently, there has also been continuous innovation and an increasing number of issuances in foreign currency. as malaysia offers international participation in our islamic financial system, we offer to be an international gateway, particularly in strengthening the link between the two important dynamic growth regions of asia and the middle east. malaysia will also continue to collaborate with other regulatory authorities to ensure financial stability in the islamic financial system. this will be through our active involvement in the islamic financial services board ( ifsb ), the islamic financial stability forum ( ifsf ), the initiatives by the islamic development bank ( idb ), and finally in the newly formed international islamic liquidity management corporation ( iilm ). in the area of capacity building, malaysia has also given priority to two areas : one is in human capital development and the second, in catalysing mutual recognition of shariah interpretations. the international centre of education in islamic finance ( inceif ) was established in 2006 for advanced education for practitioners in islamic finance, and in 2008, the international shariah research academy ( isra ) was established to conduct applied shariah research on the contemporary islamic finance issues and to provide a platform for active international engagement among shariah scholars. moving forward, malaysia will continue its efforts in strengthening our international linkages in the global islamic financial system through collaborative partnerships and cooperation with the objective of contributing towards greater international financial and economic integration. let me conclude. on behalf of the mifc executive committee, i would like to express my appreciation to the members of the panel of jury for the royal award for islamic finance which is led by yang amat berbahagia tun musa hitam, former deputy prime minister of malaysia and also to the members of the taskforce that was chaired by tan sri zarinah anwar, chairman of the securities commission, who oversaw the establishment of this prestigious award. it is my sincere hope that this royal award will be an inspiration to the global development of islamic finance.

also depend on international factors, in particular on potential spillovers from the united states. ” you are waiting for greater clarity, but in the meantime there is growing criticism. the banking sector in particular is grumbling about negative interest rates. praet : “ that ’ s true, but their criticism is often excessive. the banks don ’ t have it easy and their profits are under pressure, but that ’ s not only due to negative rates. there was too little consolidation post crisis, for instance. so there is now a great deal of competition in the banking sector. however, we observe that this situation does not prevent banks from letting their clients benefit from easy financing conditions, including access to cheap long - term central bank credit ( tltros ). so right now we are satisfied with the impact of our policy. surveys of smes for example show that they ’ re no longer particularly worried about access to credit. and that suggests that lending is no longer holding back growth. ” as long as interest rates are negative, this will fuel criticism. not least because the concept of ‘ negative rates ’ is so difficult to grasp. could that be an argument for hiking rates before scaling back your bond - buying programme? praet : “ the negative deposit rate is part of a complex package of interrelated measures. if one element changes, this can have an immediate effect on all interest rate levels. suppose you keep buying bonds, which pushes down long - term rates, while raising short - term rates, which changes the expectations for all future interest rates. you then exert two opposing forces on long - term rates, ultimately partially negating the effect of the bond - buying programme by raising short - term rates. look, there is a very strong chain of logic behind the decision to first scale back quantitative easing ( qe, the bond - buying programme, ed. ), raising the term premium included in long - term rates, and only then hiking short - term rates. we have to scale back our policy in an orderly fashion if we don ’ t want to undo the benefits of what we ’ ve been doing for the past few years. ” why does this sequence cause so much discussion if it ’ s so obvious? praet : “ some bankers assert that an increase in the deposit rate would actually constitute a loosening of our policy, as banks would then give more credit. but as i said, lending levels are already developing well. no one likes the current environment