demand is undeniable, but i think it is also important to attract demand from emerging economies. they are japan's competitors in world trade but at the same time potential customers for japanese products. historically, japanese manufacturers have responded swiftly to structural changes in the world economy and cultivated new customers. i believe that they should further develop such competency to address the medium - to long - term issues, and this would be one of the pillars supporting a smooth adjustment process for the japanese economy. the second point relates to how to minimize the negative effects of an aging population and the constraints from limited irreproducible resources and the ecological environment. my opinion is that innovations that create eco - friendly products will pave the road to success. let me adduce an example of the issue of an aging population. today's development of technologies, typically of digital appliances, seems to be one that primarily targets the younger generation and generates profits through mass production. however, such development would produce less value - added than before as the proportion of the population comprised by the younger generation decreases. it will become increasingly important for firms to employ new elderly - oriented technology ahead of their competitors. in fact, in the area of finance, product innovations are necessary to find the way to finance sociallyrequired investments by making use of financial assets held by the elderly in particular. it is crucial that different industries – for example, financial and manufacturing sectors – cooperate with each other to address such issues. looking at the economy of hyogo prefecture based on the argument just presented, responses to the medium - to long - term changes in the economic environment seem to be making steady progress. as for responses to the constraints from limited irreproducible resources and the ecological environment, for example, there are many factories producing solar, lithium - ion, or nickel - hydrogen batteries in the region. a number of firms related to wind power generation are also clustered in hyogo prefecture, and i understand it is viewed as one of the regions with high potential in ecological business. the changes we are facing in the economic environment are a global phenomenon and eventually will affect all of society. in such a situation, exerting originality and ingenuity is the only way to survive as individual firms and a nation as a whole. i sincerely hope that various efforts currently being made will bear fruit and bring prosperity to the economy of hyogo prefecture.

toshihiko fukui : central banking under globalization speech by mr toshihiko fukui, governor of the bank of japan, at mas lecture 2007, monetary authority of singapore, singapore, 15 november 2007. * * * i am very privileged to have been invited by the monetary authority of singapore to deliver its 2007 lecture. i have seen the list of prominent speakers in past lectures, and i am much honored to follow them. my topic today is the role of central banks in the context of increasing economic globalization. i. progress in economic globalization as globalization proceeds, cross - border trading of goods and services as well as funds and financial products has been increasing. although this trend had been underway for at least half a century, the pace of increase seems to have accelerated in recent years. according to research done by the international monetary fund ( imf ), world real gdp increased by around 50 percent over the last decade ( from 1996 to 2006 ), indicating a high growth rate. over the same period, the volume of world trade almost doubled, representing a growth rate around 30 percent faster than that of world gdp. this means that international trade in goods and services has outperformed the expansion in the world economy. also, from 1994 to 2004, the growth in the global sum of overseas assets and liabilities outpaced that of world gdp by around 50 percent, and this can be considered an indication of the progress in financial globalization. the rapid pace of globalization is closely related to advances in information and communications technology ( ict ) and strong growth in asia and other emerging economies. the progress in ict has further eased geographical limitations on cross - border transactions of goods, services, and financial products. against the background of these technological innovations, emerging economies, with their abundant supply of skilled labor, have established their position as global production bases. in addition, emerging economies are now regarded not only as production sites for manufacturers but also as locations for software development centers or call centers for non - manufacturers. these economies are now being brought into the business process of supply - chain management by many firms. with the accumulation of purchasing power through this process, emerging economies have also increased their presence as markets with huge potential. in the meantime, their wealth, coupled with abundant funds accumulated in oil - producing countries, has caused a significant increase in the international flow of funds. this has in turn promoted financial innovation such as the introduction of sophisticated financial products and the expansion of financial players such as managed funds. development of