. 2 billion ( as of may 2011 ) and annual growth of 9. 3 % ( 2010 ). in the near future, i strongly believe that sukuk will grow significantly as it can be developed to have various forms of contracts with attractive features offering competitive returns and liquidity. in addition, the existences of excess liquidity from surplus savings in asia and oil revenues countries across middle east become a potential demand for sukuk. this opportunity can be used by the government or private companies to issue sukuk as an alternative financing source. the current positive trend of issuing sukuk for financing government ’ s infrastructure projects provides a good signal of support from the government that should be maintained. ladies and gentlemen, through this summit, where the meeting of regulators, practitioners, academics, potential investors and industry experts are possible, it is hoped that the potential of the islamic banking and finance will be maximized to further improve the current swift development of the industry. in the future, it is expected that asia will grow to be the next islamic finance hub, in addition to middle east. bridging these two potential markets for developing islamic financial industry will also contribute to the increase of economic growth in respective regions. despite all those success stories and potential growth of islamic finance, we believe that the road ahead remains challenging. i would like to point out four main issues that can be further discussed in this summit. firstly, concerning the islamic financial products. in terms of product development, islamic financial institutions should develop innovative products that can bring up the uniqueness of sharia components. instead of emulating conventional products or adopting islamic dressing to existing products, industry should move towards creating pure or genuine sharia products that seek to bridge the financial sector with real sector. bis central bankers ’ speeches i believe the strength as well as the uniqueness of islamic transactions lies within the profitloss sharing mechanism, provision of underlying assets and commitment to promote real sector. however, in general, the record of profit - loss sharing ( pls ) transactions in islamic banking industries across countries are still relatively low. i strongly believe that increasing portion of profit - loss sharing transactions, such as mudharabah and musyarakah, will be beneficial for both the financial sector and the real side of the economy and will eliminate decoupling or detachment effect between two sectors, a situation that was behind the recent global financial crisis. another issue related to product development is about product codification. at the moment, as you all

products which truly confirms to sharia principles, complemented by appropriate legal framework, regulations and standards, insya allah, this creation of “ genuine ” islamic financial system would be able to reduce systemic risks and continue to become resilient to any financial shocks. as mentioned earlier that increasing portion of profit - loss sharing transaction will reduce the potential bubble in the economy and decoupling problem between financial sector and real sector. the fourth point is about “ real rate of return ” references. besides beneficial in creating and maintaining stability, we also believe that profit - loss sharing, the spirit of islamic finance, bis central bankers ’ speeches would give more fair return to all parties ( funds owner, financial institution, and borrower ). the return distributed to all parties should be a real result of business activities in the economy. however, at the moment, islamic financial institutions seemingly tend to refer their rate of return to conventional rate of return ( interest rates ). conceptually they should refer to the real rate of return in the economy. unfortunately, currently there is no valid reference available about the real rate of return. therefore, international islamic institutions and countries regulator need to collaborate to study about the real rate of return that will become a reference for islamic financial institutions in determining return, instead of referring to conventional interest rates. ladies and gentlemen, beside those four main issues, i would like also raise two additional challenges regarding liquidity and human resources. most of us aware that currently islamic financial markets have limited instruments and restricted access to short - term funding options in raising liquidity as compared to conventional markets. we should think of methods to enhance islamic liquidity market based on contracts consistent with sharia principles. a caveat for such initiative will be, to carefully identify and structure the instrument for the purpose of raising liquidity only and not for the tools for speculation. the emergence of global money market will reduce the reliant of islamic financial institutions in mirroring the techniques regularly use by conventional banks that are still within the grey area and debatable in terms of its sharia compliancy. hence, islamic finance can maintain its reputation as the sector linking financial intermediary and real sector and slowly close the door to a heavy use of leverage that once led to global financial crisis. related to human resources issues, we understand that the fast growth of islamic financial institutions so far isn ’ t followed by sufficient supply of human resources. in indonesia context, the tremendous acceleration of islamic finance industry has created human resources supply