. fourthly, is the uncertainty related to the implementation of the structural reforms to address the structural rigidities and deficiencies that surfaced during the global financial crisis. fifth and finally, are also considerable geopolitical uncertainties prevailing in the world today. cumulatively, these developments have compounded the uncertainties surrounding the global economy. in this environment of great uncertainty, a more moderate recovery of the global economy has been projected for 2015. the most pressing challenge, therefore for the global economy, is to generate an economic recovery that is balanced and sustainable. although the growth momentum has improved in a number of major economies, the growth has thus far been modest. in addition, weaknesses in several major economies continue to point to a global economy that remains vulnerable to downside risks. while the growth performance in most emerging economies is projected to moderate, collectively emerging market economies remain an important driver of growth of the world economy. a less robust external sector, bis central bankers ’ speeches slower domestic demand and specific domestic factors are amongst the reasons for this growth performance. in asia, the growth for 2015 is projected to be sustained at 6. 4 %, while growth in the asean - 5 is projected to be in the region of 5 %. a further phenomenon affecting the global economic performance is the significant decline in global oil prices. while this has partially offset the weaker - than - expected growth momentum in some of the advanced countries, it has, in different degrees, adversely affected the oil exporting economies resulting in divergent growth performance across and within regions. overall, however, the global economy is expected to benefit from the lower oil prices. a further recent development is the consequences of the unprecedented and divergent monetary policies being pursued in the major economies which have now resulted in significant policy spillovers to other parts of the world. against this backdrop, the financial markets are therefore expected to remain in a state of heightened volatility during this year. given the degree of openness of the malaysian economy and the financial system, we are of course affected by these global developments. these effects, however, need to be seen from the perspective of our underlying conditions. malaysia is affected by these external developments through trade and capital flows. the diversified structure of our economy and of our exports has reduced the impact of the effects of the plummeting oil prices on the economy. while the current account of the balance of payments is expected to narrow, it is projected to remain in surplus. the global shifts in liquidity have caused size

the development throughout malaysia. the emergence of new growth areas in malaysia such as renewable energy ( e. g. solar ) and semiconductors in fast - growing segments such as automotive, medical devices and telecommunications, has enabled malaysia to be plugged into the global supply chain. investment in the manufacturing sector has moved towards higher value - added activities, shifting from basic production and assembly to producing goods which have advance applications such as in the automotive and healthcare sectors. as a country which is strategically located within close radius of two of the most populous economies in the world, china and india, malaysia is centrally located in asia, more broadly, and in asean, in particular. with the conception of the asean economic community ( aec ), companies would benefit from the stronger economic inter linkages through greater cross bis central bankers ’ speeches border liberalisation and increased intra - asean trade. firms in this region will gain greater market access to 630 million people that are generating economic region that is worth usd2. 4 trillion. the increasing importance of asia in the global economy has raised international interest to better understand asia – the economies, businesses and the people that comprise the region. on that note, i would like to mention that bank negara malaysia has entered into a collaboration agreement with the massachusetts institute of technology sloan school of management ( mit sloan ) to establish the asia school of business ( asb ) in kuala lumpur. asb is envisioned to be a premier business school that develops transformative and principled leaders that will contribute to a better future and the advancement of the emerging world. conclusion let me conclude my remarks. we are now experiencing a phase of modest growth in the global economy, in an environment that is characterised by heightened uncertainty and volatile financial markets. the malaysian economy has withstood these challenging times, supported by our strong initial conditions and early and comprehensive policy responses. the intrinsic strength of the economy, reinforced with policies to encourage greater investments that would serve to ensure greater economic sustainability for the future. finally, active regionalisation is an important strategy for asia to enhance regional economic prosperity. malaysia actively participates in the efforts to strengthen linkages within the asean community and to creating opportunities to foster greater economic integration. these efforts will place asean on a path to realising its economic potential and enable the region to collectively prosper. bis central bankers ’ speeches