We must, as part of the comprehensive suite of financial services that we offer to global investors and borrowers. Shariah-compliant financial instruments allow issuers to tap a new source of funds and liquidity. But the development of an Islamic financial services market does not just serve indigenous Muslim populations. Malaysia, for instance, has successfully launched global sukuk, or Islamic bonds, to tap liquidity from investors in both Asia and the Middle East. Other issuers of global sukuks have also stopped by Singapore on their road shows to tap Singapore’s investor pool. It may not be too long before we have a Singapore corporate issuing a sukuk to raise funds from global investors. We are also seeing already private fund managers in Asia and the Middle East working together. Recently, for instance, ARA Asset Management based in Singapore had worked in partnership with Dubai Islamic Bank to launch a $ 450 million Islamic Far Eastern Real Estate Fund with underlying assets located in Asia. Fourth and finally, we can do more to foster people-to-people interaction in the financial sector. For instance, Asian central banks including the Monetary Authority of Singapore have participated actively in Middle East finance and central banking seminars to share our perspectives on issues of mutual interest. Tomorrow there will be a seminar organised jointly by the Islamic Financial Services Board and Islamic Development Bank tomorrow in Kuala Lumpur on developing a 10-year master plan for the Islamic financial services industry globally.
Increasingly, wealthy investors the world over are looking to spread the risks and enhance the overall returns on their investment portfolios. We are seeing this search for diversification and improved returns on investment amongst sophisticated investors from the Middle East and Asia. It provides an opportunity for markets in Asia and the Middle East which can offer wealthy investors with higher expected returns at acceptable risk. The demand side of the financial equation in our two regions is equally compelling. First, there are unprecedented demand for funds to finance infrastructure projects, across the region. In Southeast Asia alone, about $ 461 billion is expected to be spent over the next 15 years to upgrade infrastructure. This is not even looking at China and India. Likewise in the Middle East - the reconstruction of Iraq and Qatar’s infrastructural plans are each expected to cost $ 100 billion. Second, besides infrastructure finance, we are seeing huge growth potential in the consumer finance sector in our two regions. It is driven by a rapidly expanding middle-class, who want better housing, cars and other big-ticket items like middle classes anywhere else in the world. For instance, India’s “consuming class” will rise from the current 30% of households to 40% by 2010. Similarly in China, the “middle class” is set to double over the next 5 years. Facilitating greater financial flows between Asia and Middle East Financial services are therefore growing rapidly in Asia and the Middle East.