At the same time, the region lacks sufficient long term fund for promoting investment for high economic growth. Sustaining high economic growth in the Asian region requires huge investment in both public and private sectors.
Through the convergence of short-term interest rates and the nearly unlimited provision of liquidity, the common monetary policy smoothes an otherwise more abrupt adjustment process, which would entail significant costs to the financial system and the real economy. But insofar as normal adjustment forces are suspended, sound incentives need to be put in place to bring about lasting gains in competitiveness and productivity.