I will discuss the progress ASEAN is making towards a single market and production base, which will create a more seamless marketplace for businesses. BIS central bankers’ speeches  1  Third, ASEAN is opportunity. I will focus on the significant investment opportunities in ASEAN, especially in the area of infrastructure. Resilience: managing inflation and capital inflows 7. Let me begin by touching on ASEAN’s resilience in the face of external shocks. The Asian financial crisis of 1998/99 was a life-changing experience for many countries in the region. They were badly affected by the crisis and resolved never again to be so vulnerable. Macroeconomic policies have become more sound, financial regulation and supervision has tightened, national balance sheets strengthened, structural reforms stepped up, and corporate governance enhanced. 8. The ASEAN countries consequently showed remarkable resilience in the recent crisis. While credit tightened and trade plunged during the height of the crisis, there was no systemic financial fallout, especially in the banking industry. The region rebounded strongly, with the ASEAN-5 growing by 8 per cent in 2010. This year, growth is expected in the range of 5 to 6 per cent. 9. But strong growth has come with a new set of challenges. ASEAN and the rest of Asia are now grappling with rising inflation. Consumer prices are forecast to increase by 5.1 per cent in the ASEAN-5 this year, compared to 3.8 percent in 2010. Several factors underpin this. 10. First, elevated food prices.
The aim is to  BIS central bankers’ speeches  3  provide financial institutions operating in ASEAN better access to the entire ASEAN customer base, and facilitate regional expansion. 26. In addition to facilitating internal integration, ASEAN has been active in linking up with other Asian economies through its strategy of open regionalism. ASEAN has a number of Free Trade Agreements with key Asian economies, including China, Japan, India and Korea. These pan-Asian linkages enable ASEAN to serve as a springboard for investors seeking access to key markets in Asia. 27. Indeed, measured by the degree of intra-regional trade, Asia is already the second most integrated region in the world, after the European Union. And ASEAN is at the nucleus of this expanding network of trade and transport connections spanning Asia. Opportunity: investment in infrastructure 28. A resilient and integrated ASEAN offers considerable investment opportunities, especially in infrastructure. 29. The demand for infrastructure investment in the region is significant. A report released by the Asian Development Bank Institute (“ADBI”) estimates that the total investment needs for national infrastructure development in Asia, from 2010 to 2020, will total about $ trillion, or an average of $ billion per year. 30. But supply – in terms of actual public and private infrastructure investment – has not matched demand. The World Bank has estimated that private sector investment into Asian infrastructure from 1990 to 2008 totaled just $ billion or an average of $ billion per year.