This leads in turn to a rise in redundancies, something we have unfortunately seen in these last few weeks. Banks then become uncertain as to whether companies can pay back their loans. When uncertainty arises about the financial strength of companies, interest rates go up and it becomes more difficult for the financial system to mediate credit from lender to borrower. Investors, those who normally want to invest money to increase their returns, back away. When they do so, the functioning of other markets increasingly deteriorates. The Riksbank acts as a safeguard so that the system does not run out of money It is now a question of trying to shorten the period of risk aversion and credit shortage as it can exacerbate and prolong the downturn in the economy. As the Riksbank functions as the banks’ bank and supplies them with money which they then pass on to others in society, the Riksbank’s task is to supply money to the financial system. This reduces the risk of money shortages and sharply rising interest rates exacerbating the situation. By guaranteeing ample access to Swedish kronor that keeps down interest rates, the Riksbank helps to ensure that consumption and investment do not fall as much as they otherwise would have done. In this perspective, the Riksbank’s task is key in order to mitigate the effects on jobs and companies. And we take this task extremely seriously because “it is no game”, as one business leader put it in our survey.
This is because our local currencies are generally correlated with each other. Also, there will be less reliance on currencies of advanced countries which last year account for over 85 percent of Thailand’s trade with Indonesia and Malaysia. 2  You may recall that earlier this year, Bank Negara Malaysia and the Bank of Thailand implemented a ringgitbaht arrangement in March as a pilot project. Since then, we have seen a noticeably narrower spread between the ringgit and the baht. Moreover, we have noted an increasing number of businesses applying this local currency scheme in their day-to-day business conduct. Today, I am very delighted that Bank Indonesia is carrying on this initiative by signing the MoUs with both Bank Negara Malaysia and the Bank of Thailand. I really hope that this scheme will continue to expand to other countries in the region. Ultimately, this would be one important step closer to having greater regional financial integration in ASEAN. On this note, may I invite Governor Agus to say a few words, and followed by Governor Muhammad Ibrahim. Thank you. 3