As much of these efforts will involve interface with other parts of the public sector, it has been my experience that the participation of the Central Bank in many of these agendas will require careful boundary management and a signing off when it is completed so that it does not remain permanently with the Central Bank. Of great importance in this process is also to carefully safeguard the independence of the Central Bank. In conclusion, let me express my deep gratitude and appreciation to my fellow governors for all the cooperation and support that has been extended to me and to Bank Negara Malaysia. For the friendship and for the collaboration, it has truly been enriching for me. And to the BIS, thank you for this privilege to be part of the Central Bank community. BIS central bankers’ speeches  3
Buffers to withstand shocks are strong – be it central banks’ reserves or banks’ capital adequacy. Second, ASEAN policymakers have demonstrated that they are able and willing to adjust policies to deal with external and internal stresses. They have raised interest rates pre-emptively. They have allowed their exchange rates to depreciate in an orderly manner, intervening in the FX markets only to moderate excessive movements. 2/3  BIS central bankers' speeches  And they have room to use fiscal policy to support growth, as debt positions are generally healthy. Take Indonesia for example. The currency has come under some pressure but the macroeconomic fundamentals are essentially sound. The economy is growing at a respectable 5%. Inflation is under control, at about 3.5% – an achievement compared to the past. The fiscal deficit has come down and is now about 2% of GDP – not an alarming number. Total debt-to-GDP ratio is 30% – a respectable number by any international comparison. The current account deficit has slipped somewhat but, at 3% of GDP, is not unduly large. And it is not unusual for a developing country to run a current account deficit to finance investment for future growth. And Indonesia’s policy responses to-date have demonstrated a willingness to take tough measures to build up resilience The central bank has hiked interest rates. The government has been re-evaluating import-intensive infrastructure spending. Markets can sometimes over-react and investors sell down EME assets in a general knee-jerk risk-off mood.