Firstly, the better economic prospects for recovery in Asia, and the expectations that Asia will lead in the emergence from the global recession could draw large capital inflows into the region. Such flows would not only lead to more volatile exchange rates, but also to increases in asset prices. Increases in commodity prices could also potentially feed into inflation and affect the economic recovery process. Most economies in Asia, including the policy makers, the financial industry and the private sector, have however, the capacity to manage these challenges. Stronger financial positions, low levels of leverage and buffers built during the good times have rendered the potential to manage the more challenging environment. The role of the financial sector is particularly important in ensuring the flow of  financing to productive economic activity is not disrupted, while exercising prudential restraint in an environment of excess liquidity. Towards the medium term, significant uncertainties remain for the outlook of the global economy. Overall global growth is expected to remain weak over the medium term with structural weaknesses in the advanced economies weighing down the overall economic growth in these economies. Being highly integrated with the global economy, the continued weakness of the advanced economies could present a challenge for overall economic growth for most emerging economies in the medium term. Therefore, it is crucial for the external sector of Malaysia to evolve into a more diversified structure to increase resilience and rely less on the traditional markets for growth. It is encouraging to note that this is already happening.
Boards must be relentless in pursuing the effective governance of risk, continuously develop their capacity to do so, and insist on strengthening processes, systems and structures as appropriate to effectively monitor and control risk. Conclusion Let me conclude my remarks. We need to prepare ourselves for a future in which we can prosper. We have every potential to do so. The authorities have great determination to provide the enabling environment for this to happen. Financial institutions need to decide on their own strategy and the business model to not only perform but also survive in this more challenging environment. The demands are for world class service and real value added to the economy. For the Central Bank, as the supervisory authority, our role will be to push the frontier of the financial infrastructure with its international inter-linkages, while not losing sight of ensuring overall financial stability. On that note, I look forward to productive discussions during these next two days on the key issues confronting the financial sector.