PETALING JAYA: Asian countries are in a “better state of readiness” to deal with shocks in the global economy as a result of the wide-ranging reforms it pursued in the aftermath of the Asian financial crisis, said Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz.
Source from (The Star Online): http://biz.thestar.com.my/news/story.asp?file=/2012/6/23/business/11536771&sec=business
Published: Jun 23, 2012
“The effectiveness of these reforms was put to test during the recent global crisis. While affected by the crisis, the effects on the domestic economies and financial systems have been relatively contained.
“Importantly, financial intermediation has not been disrupted, and the financial systems have continued the supply of credit to support the real economy,” she said in her keynote address at the Wharton Global Alumni Forum in Jakarta, Indonesia.
“The building of sufficient capital and liquidity buffers during good times provided the ability to support the continued credit intermediation process. Improved regulatory and supervisory approaches, underpinned by enhanced governance and risk management practices, have enhanced financial stability in the region.
“Continued efforts were also made to further advance financial sector development in the region. In particular, the development of the domestic bond market has served to reinforce the foundations for financial stability in Asia.
“Financial activities have also remained generally anchored by productive real economic activities. In addition to the region's strong external position, high international reserves and more flexible exchange rates have also enabled Asia to absorb and adjust to changing external conditions,” Zeti said.
While noting that Asia's openness made it vulnerable to adverse developments in the external environment, she said the region's increasing cohesiveness was a core strength and source of stability.
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