New issues during the year reached a record high to about $ billion and the outstanding global sukuk market has now surpassed the $ billion mark. Despite the more challenging international financial environment arising from the financial crisis that has occurred in a number of the advanced economies in the  BIS Review 97/2008  1  recent twelve months, the sukuk market while also affected, it has been to a lesser extent. Up until June 2008, it has held its ground with a total global issuance now exceeding $ billion. With greater recognition of the sukuk market as a competitive and attractive form of financing, the global sukuk market is expected to continue its growth going forward. The International Islamic financial hub evolving in Malaysia is supported by five pillars. Pillar 1: sukuk origination Following the first ever sukuk in the world that was issued in Malaysia in 1990, Malaysia has now developed a deep, liquid and vibrant sukuk market. Recently, the largest sukuk ever was raised in the Malaysian sukuk market in 2007. The magnitude was approximately RM15 billion or about USD5 billion equivalent. Despite being issued during the height of the subprime crisis, it attracted huge demand and was oversubscribed by more than two times. Sukuk origination has thus been identified as one of the important pillars of the Malaysian Islamic financial system. As of the end of 2007, more than 60 percent of the outstanding global sukuks originated from Malaysia.
In a world of low growth, the political rhetoric in some major economies has tended to focus more on the costs and less on the benefits. That is unfortunate, because given the current circumstances of the global economy, it is likely that we need deeper and fairer integration. For emerging economies in Asia and Latin America, the question for us is whether deeper economic and financial integration offers a feasible path towards unlocking sustainable growth of our economies? How do we mitigate the costs and maximise the benefits? The World Bank theme paper for this conference provides a useful starting point for thinking about these issues. I will leave it to the learned speakers today to ponder on that. I will just briefly share my perspective on this issue with respect to ASEAN and Malaysia. Asian regional economic and financial integration The ASEAN Economic Community Blueprint 2025 contains ASEAN’s vision of regional economic and financial integration over the next 10 years. When it came to formulating the 2025 Blueprint, the issue of the nature of integration has always been central. The fundamental challenge remains on how to use regional integration to leverage on ASEAN’s diversity in terms of economic size and structure, income levels, resource endowments and stage of financial sector development. Here, in the interest of time, l will just focus on ASEAN financial integration. I remember that soon after the Asian Financial Crisis, there was a lot of interest in looking at the European model of a single currency.