is a shared responsibility, across the major regions of the world. several reasons have been cited as constraints to the process of adjustment. this include the relative lack of strength in domestic demand outside the us ; the large gap between saving and investment in major regions of the world ; and the fragmented structure of global capital intermediation that hinders surplus regions from financing productive investments within their region. it is important to recognise the important role that asia can have in contributing to rebalancing global growth and in so doing contribute towards global adjustment of the imbalances. in terms of economic growth, the region has consistently recorded performance that is, one - and - a - half times higher than the global average. on demographics, asia is home to more than half of the world's population, with a young and growing workforce, and expanding middle - class in a number of countries. robust domestic consumption and rising investment have therefore become important sources of growth. this has been supported by the rising income and increased productivity and the expansion of intra - regional trade. the increasing importance of intra - regional trade, which accounts for more than 50 % of asia's total trade, makes the region the next most integrated region after the european union in trade. this has positioned asia as the largest and fast - growing market in the world. in addition, the asian region has also embarked on measures to spur its economic openness by forging free trade agreements, which would contribute to increasing the capacity of the region and the potential of the region, in addition to improving prospects for contributing towards the rebalancing of global growth and the global adjustment process. combined with the region's traditionally high degree of economic openness with a total trade averaging 95 % of gdp in the region, it reflects asia's potential to be a self - sustaining and mutually reinforcing the region's growth. the greater degree of economic flexibility in the region in responding to shocks and the dynamic global conditions is a further feature that contributes towards strengthening the region's potential. while private consumption's contribution to domestic demand is becoming increasingly more significant in the region a renewed expansion in investment is also needed to create a more sustainable growth path. significant initiatives are already underway to increase the contribution of private investment and secure new areas of growth. these include improving the investment climate and reducing the cost of doing business. efforts would also continue to be on - going on the priorities in the region as countries have the potential to further expand the role of

decisions. as i shall discuss, the eurosystem is directly involved in most, although not all, of these activities. the economic rationale for the ecb ’ s involvement in international cooperation activities rests on the international externalities of domestic policies, ie spillover effects which policies in one economy can produce on other economies via, for instance, interest rates, exchange rates and equity prices. the euro area, however, is a large and relatively closed economy. the degree of trade openness of the euro area is much smaller than that of its constituent countries. measured by the average of exports and imports as a share of euro area gdp, the degree of openness is 16 % in the euro area. by contrast, prior to monetary union, the average export ratio of individual member states stood at around 35 % in 1997. this helps to understand both why the euro area is not affected by spillover effects to the same extent as small open economies, and why the eurosystem is in a position to pursue its primary objective - maintaining domestic price stability - in the most effective way. this does not mean, however, that the ecb neglects external economic developments when establishing the euro area monetary policy. on the contrary, the ecb takes these developments into due account as they may have an impact on domestic economic developments, and thus on price stability. the ecb ’ s approach to external economic developments has three implications for the participation of the eurosystem in the process of international cooperation in the area of macroeconomic policies. first, a substantial component of the ecb ’ s cooperation is the reciprocal exchange of information and views within international organisations and fora. regular consultation on external economic developments enhances the ecb ’ s ability to analyse the outlook for price developments in the euro area. by taking into account possible spillover effects from third countries ’ policy actions, consultation plays a part in reducing the likelihood of misinterpreting the impact of external developments on domestic variables. given its voluntary nature, consultation does not impinge on the ecb ’ s independence. second, consultation is supplemented by international surveillance. in this case, a third and independent party, such as the imf or oecd, regularly monitors and assesses the economic policies of its members. in this regard, whenever the euro area monetary policy is under surveillance, the ecb is solely responsible for interaction with the imf and oecd. international surveillance adds to the ecb ’ s transparency as both