Considerations of climate change, environmental damage and the depletion of natural resources have become a higher priority, and therefore needs to be also integrated with financial and economic policies, for example through the implementation of policies on sustainable financing. Finally, given the higher degree of connectivity not only within the domestic financial system and economy, consistent policies and coordination becomes key. Clarity on the governance process for greater interface among regulators becomes important, including that involving cross border interface. For the Asian region, the East Asian central banks have since 2007 established a Monetary and Financial Stability Committee to discuss assessments of risk and vulnerabilities to macroeconomic and financial stability in the region. The strategy for policymakers in Asia has been to build a higher degree of resilience to be better positioned to withstand external shocks and to provide an enabling environment to achieve a sustainable economic performance. For central banks, the focus is on preserving monetary and financial stability. Of equal importance is the development of the domestic financial infrastructure. Important in the policy design of central banks is that the policies are anticipatory. Delays in policy action or exit will invariably result in higher costs, over adjustment and other unintended consequences. A second aspect of policy is that rule based policies such as inflation targeting does not give the policy space to take into account sources of instability and other trends that may work to diminish the extent of such instability.
Zeti Akhtar Aziz: Asia’s role as an important growth centre in the global economy Opening address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the First Asian Central Banks’ Watchers Conference, organised by the Official Monetary and Financial Institutions Forum (OMFIF) and the Lafferty Group, Kuala Lumpur, 1 November 2011. *  *  *  It is with great pleasure that I welcome you to the first Asian Central Banks’ Watchers Conference organised by the Official Monetary and Financial Institutions Forum (OMFIF) and the Lafferty Group. Bank Negara Malaysia is very pleased to host this event here in Kuala Lumpur. Central banks have generally been the most watched organisations given the significance and far reaching implications of their actions on financial systems, the economy and the economic well being of the public at large. This is even more so during periods of financial stress and economic distress. During such periods, central banks have generally been at the forefront in managing such crisis and its consequences. Indeed, this current global crisis has prompted central banks in the United States and Europe to be closely watched given the impact of their actions on not only their own national economies but also on the rest of the world. With the growing significance of the emerging economies in the world economy, our policy actions have increasingly drawn significant interest.