On an international scale, financial cooperation initiatives, such as the ASEAN Infrastructure Fund (AIF) would also complement domestic endeavors in channelling intraregional savings to needed projects. 8. This leads me to the second of the preparatory work, which is improving supportive framework for private financing. The Mekong river is made up of small tributaries flowing towards the same end to form a large fertile river. The benefits we receive from the confluence of these small tributaries as opposed to one waterway are incomparable. Likewise, strengthening domestic capital markets would help allocating available savings to the most productive use, thus, facilitating real sector’s economic activities and supporting economic growth. 9. A deep and liquid financial market could reduce business over-reliance on bank financing channel. On the other hand, it could also serve as a less-expensive alternative source of funds for local entities. The initial stepping stone towards a well-developed financial market is to improve the cross-country interconnectedness of local financial markets. Financial connectivity could be enhanced by linking capital and bond markets, creating regional exchange trading system, as well as developing a network of payment and settlement system. Another important step is to streamline rules and regulations to facilitate cross-border movement of capital. Such a process can be achieved through promoting flows of capital among member countries via reducing regulatory obstacles to stimulate foreign participation and outward investment. Currently, Thailand allows non-residents of ASEAN to issue both foreign currency-denominated and local currency bonds. The derivative market also serves investors to hedge against financial risks.
With the promising economic potentials ahead of us, I would like to reemphasize our shared vision of “What we shall expect to see for the future of the Greater Mekong Subregion” and “How we can achieve such prosperity.” 4. I picture the Greater Mekong Subregion (GMS) in the next twenty years as a much more connected and integrated region: a region where we are not only connected solely by a river, but by various modes of transportation, where one can travel conveniently, where trade and investment can flow across efficiently, and where prosperity can be widely enjoyed even by those in the rural areas. Although we are not yet there, I strongly believe that this vision can come true. 5. We always hear the saying “Rome was not built in a day”. Thus, we have to start working together towards our shared vision starting today. There is a great deal of preparatory work to be done; but in my view, some of the most crucial tasks are infrastructure development and businesses access to funds. The first task is channelling intraregional funds to infrastructure projects, followed by the second task of promoting economic growth and equality within the region through enhancing financial markets and supporting private financing. Ladies and Gentlemen, 6. Let me highlight key issues on the first preparatory work, which is financing infrastructure development. The ADB has already committed at least 9 billion US dollars1 to fund its GMS development projects in the pipeline.