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“The Development of Global Financial Centres” by Datuk Seri Panglima Andrew L. T. Sheng “The Development of Global Financial Centres” by Datuk Seri Panglima Andrew L. T. Sheng Tun Ismail Ali Professor of Monetary and Financial Economics Faculty of Economics and Administration University of Malaya The Puteri Pacific Hotel, Johor Bahru Thursday, 18 May 2006 1

Contents 1. Role of Financial Centre in National and Global Context 2. How Hong Contents 1. Role of Financial Centre in National and Global Context 2. How Hong Kong defended and enhanced position as largest international financial centre ex-Japan 3. Key issues in building IFCs 4. Potential for Malaysia 2

Cities and Financial Centres u Efficiency of economies all about efficiency of urban centres, Cities and Financial Centres u Efficiency of economies all about efficiency of urban centres, e. g. New York vs. Mexico City u Cities are knowledge centres u u u Art, culture, politics, trade, news Must have rich hinterland, linked by superior communications, e. g. river, sea, road, rail, air Exchanges and Technology u Pre-telegraph, 100+ US exchanges, u Advent of radio, 22 (1935) u Advent of computers - 7 (1995) 3

Financial Markets are Networks Metcalfe’s Law - “The value of a network goes up Financial Markets are Networks Metcalfe’s Law - “The value of a network goes up as the square of the number of users” u Economies of Scale u u u Supply side - Biggest producer wins Demand side - Biggest buyer determine standards Critical Mass u u Best combination of skills create economies of scale u u Aggregation of local knowledge and skills Critical Mass = Clusters = skills concentration Supply Chain Management - where in the chain is real value? 4

Changing Structure of Financial Markets • Financial Innovation Ø Evolution of derivatives, options & Changing Structure of Financial Markets • Financial Innovation Ø Evolution of derivatives, options & futures • Technology & Telecommunications Ø Ø u Global 24 hours markets From market place to market space Deregulation Ø Lines of traditional businesses blurring 5

Finance is Derivative of Real Economy, Value defined by information + Knowledge • Commoditization Finance is Derivative of Real Economy, Value defined by information + Knowledge • Commoditization means that low-knowledge products and services have high competition, low prices and are easily duplicated and therefore “taken away”. • Markets are all about “branding” and “high knowledge content products”. Knowledge content needs governance - value creation needs total inputs at production, design, packaging and marketing levels. • Network Economy demonstrates “winner-take-all” situation. Financial markets converge on key hubs, e. g. New York taking American time zone business, London taking European time zone business 6

Reliable Information Essential for Quality of Markets • Quality Markets require real time and Reliable Information Essential for Quality of Markets • Quality Markets require real time and reliable information to make sound risk management decisions in highly volatile environment • High quality information requires : – Good accounting and auditing standards – Reliable & timely statistics/reporting processes – Infrastructure to process information for making decisions critical to competitive success • Bad accounting = distorted information = poor decision making = bad risk management financial crisis 7

Hierarchy of Information Wisdom Knowledge Value Information Data • Robert W Lucky, “Silicon Dreams: Hierarchy of Information Wisdom Knowledge Value Information Data • Robert W Lucky, “Silicon Dreams: Information, Man and Machine”, St Martin’s Press, 1991. 8

Sequencing and Hierarchy of Domestic Financial Markets Asset-backed securities and derivatives Corporate bond and Sequencing and Hierarchy of Domestic Financial Markets Asset-backed securities and derivatives Corporate bond and equity markets Government bond market Treasury bill market and foreign exchange markets Money market Source: Karacadag, Sundrarajan & Elliot, 2003 9

Market Discipline Key for Corporate Governance Quality of markets depends on quality of corporate Market Discipline Key for Corporate Governance Quality of markets depends on quality of corporate governance in listed companies • Corporate governance is about three key disciplines: – Self discipline - ethics & fairness – Regulatory discipline - a level playing field – Market discipline - competition & accountability • Asia traditionally stressed first two disciplines at the expense of market discipline • • The key to capital market development is to promote and enforce these disciplines based on reliable information 10

Efficient Markets require: • Free Entry of Participants and Products • High degree of Efficient Markets require: • Free Entry of Participants and Products • High degree of transparency/low information asymmetry • Efficient Operations by solvent participants under international rules of the game at low transaction costs • Absence of incentive distortions or bias that moves markets in unhealthy direction e. g. moral hazard or subsidies • Efficient regulation at low regulatory costs; • Orderly exit of insolvent participants [obsolete products and insolvent operators create huge dead costs on market] • Accountability [feedback and exit for bad players] 11

Malaysia already has balanced financial sector (% of GDP) Bank Deposits Equity Market 1990 Malaysia already has balanced financial sector (% of GDP) Bank Deposits Equity Market 1990 2004 China 75. 6 177. 8 n. a. 40. 3 8. 5 29. 4 Hong Kong 205. 6 299. 3 107. 2 486. 3 1. 5 28. 3 India 31. 4 51. 1 10. 4 48. 4 19. 9 31. 7 Indonesia 29. 8 38. 9 4. 4 24. 9 0. 4 24. 1 Japan 100. 0 120. 5 121. 7 73. 2 85. 9 181. 6 Korea 32. 6 68. 8 48. 2 56. 1 34. 1 74. 9 Malaysia 52. 1 88. 7 100. 7 152. 6 69. 8 89. 3 Singapore 74. 3 104. 4 95. 8 149. 0 27. 8 58. 6 Thailand 56. 8 79. 7 29. 2 72. 3 9. 7 38. 9 Germany 53. 8 96. 7 21. 7 42. 2 51. 6 80. 3 UK 87. 8 115. 0 85. 2 123. 0 36. 8 43. 9 US 59. 6 58. 8 57. 5 131. 6 122. 0 157. 2 Source : World Bank Financial Sector Dataset, February 2006 Bond Market 12

Case Study: Hong Kong as IFC after 1998 Stock Market Intervention u u u Case Study: Hong Kong as IFC after 1998 Stock Market Intervention u u u August 1998: HK Govt intervened with US$15 billion in stock market to stop hedge fund speculation Immediate action: Ø Rebuild Market Credibility Ø Close Gaps with London/New York: better regulation, more products, greater liquidity Ø Build Stronger Links with China and Asia: more research, better marketing, closer connections Medium and long-term: Ø Greater integration with Pearl River Delta to compete against Yangtze River Delta/Shanghai Ø Wall Street in Asia 13

Strengths of Hong Kong u Low Transaction Costs Ø Ø Ø u Low Exchange Strengths of Hong Kong u Low Transaction Costs Ø Ø Ø u Low Exchange Rate Risk and Uncertainty Ø Ø Ø u Rule of law with advanced property rights system Free and open economy with world-class financial system Low tax rate and simple tax system Fully convertible currency Exchange rate linked firmly to USD Fully open and deep capital market Next to Rapidly Growing Southern China Ø Ø Ø Potential for lowering production costs Potential for expanding turnover Potential for servicing new wealth 14

Understanding Strengths and Weaknesses u Pre-WTO, Hong Kong had premium as external window for Understanding Strengths and Weaknesses u Pre-WTO, Hong Kong had premium as external window for China and East Asia, when access to markets and knowledge was poor u Franchise is eroding when China gains access to WTO and through Web u However, biggest value added is “Localization of Global Knowledge” - add value by being: u Preferred financial centre in Asian Time Zone u Best logistics centre in ATZ u Importing external skills [e. g. marketing, finance, technology and tailoring for local markets 15

Learning from Competitors u Lessons from Shanghai and Singapore: Ø Ø Ø u Lessons Learning from Competitors u Lessons from Shanghai and Singapore: Ø Ø Ø u Lessons from Japan, Taiwan and other Asian economies: Ø Ø Ø u Clear vision, sound strategy and detailed blueprint Effective coordination among local and central governments and business No economic borders to residents or outsiders Political stability key to stable growth Protectionist policies only delay pain People and capital move faster than policy changes Implications for Hong Kong: Ø Ø Economic and financial integration of Hong Kong (finance), Southern China (manufacturing) and Taiwan (technology). Hong Kong could provide the best service for Mainland, Taiwan, Asia and international business 16

Competition & Co-operation Strategies u Hong Kong domestic market alone too small to have Competition & Co-operation Strategies u Hong Kong domestic market alone too small to have critical mass u In areas where HK has critical mass, play dominant player strategy u u e. g. Financial services - improve quality to capture value in Supply chain management In areas where HK has no critical mass, cooperate and affiliate u e. g. Move manufacturing where there is cheap labour u e. g. cooperate with others to achieve economies of scale [airports, power, environment] 17

Markets are a function of Liquidity & Friction Costs u The greater the friction Markets are a function of Liquidity & Friction Costs u The greater the friction cost, the more the market moves to areas with lower friction costs u The lower the friction cost, the higher liquidity u Friction costs depend on the following: u Time [speed to market] u Factor costs [Labour, Capital, Taxes] u Infrastructure costs - how good is physical utilities? u “Government costs” - are rules & policies costly? u Barriers to Entry - competition policy 18

Structural Costs Compared HKSAR China US Japan Production Costs High Low High Transaction Costs Structural Costs Compared HKSAR China US Japan Production Costs High Low High Transaction Costs Low High Low Infrastructure Cost High Medium. Low Saving Rate Medium High Low Expected Investment Return Low High Medium. Low Speed to market Slow “Government Costs” Barriers to Entry High Slowing Low High Rising High Medium High Improving Good Low High Lowering Low 19

Hong Kong’s 1999 Three-Pronged Reform Programme 1. Market reform: SEHK and HKFE were demutualized Hong Kong’s 1999 Three-Pronged Reform Programme 1. Market reform: SEHK and HKFE were demutualized and merged to form the HKEx in Mar 2000, listed on 27 Jun 2000 2. Infrastructure reform: fully electronic web-friendly world-class high tech infrastructure by 2002/2003 3. Legislative reform: Securities and Futures Ordinance passed in 2001 Complete Corporate Governance and Enforcement overhaul 2001 -2005 20

Hong Kong – Largest Market in Asia ex -Japan, 1988 -2006 (US$ bn) Remark: Hong Kong – Largest Market in Asia ex -Japan, 1988 -2006 (US$ bn) Remark: x = increase from end 1988 to end Mar 2006 Sources : WFE and IFC 21

Capitalization and Turnover of Major Markets (end Mar 2006, US$ bn) Remarks: Sources: Turnover Capitalization and Turnover of Major Markets (end Mar 2006, US$ bn) Remarks: Sources: Turnover - for the 12 months ending Mar 2006, P/E ratio - end Mar 2006 Due to different reporting rules & calculation methods, turnover figures are not entirely comparable P/E ratio for China is the weighted average of A and B shares markets WFE and websites of various exchanges 22

Financial Sector Masterplan (FSMP) • A 10 -year plan (2001 – 2010) outlining strategic Financial Sector Masterplan (FSMP) • A 10 -year plan (2001 – 2010) outlining strategic focus & actions, with 119 recommendations and encompassing 6 sectors: • • • Banking Insurance Islamic Banking and Takaful • • • Development Financial Institutions Labuan IOFC Alternative Modes of Financing • Objectives • • • Create a more efficient (services at lowest cost), effective (broad range of services) & stable (minimal systemic risks) financial system Meet socio-economic agenda in an effective & efficient manner Meet international commitments & prepare domestic financial institutions for global competition • Implementation Phases • Phase I (3 years) - Enhance capacity of domestic institutions to compete - Enhance financial infrastructure • Phase II (3 -4 years) - Intensify competitive pressure in the domestic financial sector - Level playing field with incumbent foreign banks • Phase III (after 7 years) - Assimilate into global arena - Introduce new foreign competition Source: Bank Negara Malaysia 23

Capital Market Masterplan (CMP) • A 10 -year plan (2001 – 2010) outlining strategic Capital Market Masterplan (CMP) • A 10 -year plan (2001 – 2010) outlining strategic focus & actions, with 152 recommendations to address 4 key Malaysian capital market challenges: • • Lingering effects of the regional financial crisis Meeting the needs of a growing economy Heightened global competition for business and investment Changing demands on the regulatory framework and authorities • Objectives • • • To be the preferred fund-raising center for Malaysian companies To promote an effective investment management industry and a more conducive environment for investors To enhance the competitive position and efficiency of market institutions To develop a strong and competitive environment for intermediation services To ensure a stronger and more facilitative regulatory regime To establish Malaysia as an international Islamic capital market centre • Implementation Phases • Phase I (3 years) Strengthen domestic capacity, and develop strategic and nascent sectors • Phase II (2 years) Further strengthen key sectors and gradually liberalise market access • Phase III (5 years) Further expansion and strengthening of market processes and infrastructure towards becoming a fully-developed capital market, and enhancing international positioning in areas of comparative and competitive advantage Source: Securities Commission Malaysia 24

Global Competitiveness: Malaysia’s Standing Countries IMD Ranking 1 WEF Ranking 2 2005 2004 1 Global Competitiveness: Malaysia’s Standing Countries IMD Ranking 1 WEF Ranking 2 2005 2004 1 2 3 9 11 21 28 29 27 59 1 6 2 4 12 23 16 35 29 58 2 28 6 10 5 12 24 17 36 74 2 21 7 14 4 9 31 29 34 69 United States Hong Kong Singapore Australia Taiwan Japan Malaysia Korea, Rep. Thailand Indonesia Source: World Economic Forum (WEF), 2005/06; Institute for Management Development (IMD), 2005 1 IMD World Competitiveness Ranking 2 WEF Growth Competitiveness Index Ranking 25

Malaysia’s Competitiveness Trend Category IMD World Competitiveness Ranking 2001 2002 2003 2004 2005 Economic Malaysia’s Competitiveness Trend Category IMD World Competitiveness Ranking 2001 2002 2003 2004 2005 Economic Performance 9 29 25 16 8 Government Efficiency 24 19 14 16 26 Business Efficiency 31 24 18 13 25 Infrastructure 35 31 31 30 34 Overall 28 24 21 16 28 Source: Institute for Management Development (IMD), 2005 26

Global Competitiveness: Government Efficiency Perspective Public Finance Countries Employment in Public Sector Government Budget Global Competitiveness: Government Efficiency Perspective Public Finance Countries Employment in Public Sector Government Budget General Govt. Expenditure Collected Total Tax Revenues United States Hong Kong 23 9 40 12 29 10 21 4 Singapore 1 19 15 10 Taiwan 13 37 16 9 Japan 2 54 18 24 15 46 22 15 Korea, Rep. 2 14 17 23 Thailand 11 16 3 13 Indonesia 17 26 8 7 Malaysia Source: Institute for Management Development (IMD), 2005 27

Global Competitiveness: Government Efficiency Perspective Institutional Framework Countries Government Public Bribing and Transparency Bureaucracy Global Competitiveness: Government Efficiency Perspective Institutional Framework Countries Government Public Bribing and Transparency Bureaucracy Decision Service Corruption United States 16 18 19 23 20 Hong Kong 47 25 9 Singapore 1 3 12 1 6 Taiwan 30 33 10 9 29 Japan 41 51 30 28 28 Malaysia 22 22 24 25 36 Korea, Rep. 33 34 20 22 33 Thailand 5 32 28 16 44 Indonesia 55 56 47 51 55 Source: Institute for Management Development (IMD), 2005 28

Global Competitiveness: Government Efficiency Perspective Openness Countries Public Access to International Foreign Protectionism Sector Global Competitiveness: Government Efficiency Perspective Openness Countries Public Access to International Foreign Protectionism Sector Capital Transactions Investors Contracts Market United States 26 28 31 15 9 Hong Kong 1 4 1 1 1 Singapore 7 11 13 23 15 Taiwan 31 33 35 43 34 Japan 43 58 43 50 36 Malaysia 50 53 44 54 47 Korea, Rep. 35 39 38 37 35 Thailand 42 27 42 53 40 Indonesia 57 47 49 52 50 Source: Institute for Management Development (IMD), 2005 29

Global Competitiveness: Government Efficiency Perspective Competition and Regulations Countries Government Subsidies Price Regulation Controls Global Competitiveness: Government Efficiency Perspective Competition and Regulations Countries Government Subsidies Price Regulation Controls Intensity Ease of Doing Business United States 13 33 16 23 4 Hong Kong 1 2 4 1 1 Singapore 3 4 24 5 2 Taiwan 15 16 27 18 8 Japan 21 46 31 21 30 Malaysia 17 37 53 22 17 Korea, Rep. 4 13 51 45 45 Thailand 19 19 44 30 19 Indonesia 33 56 57 51 54 Source: Institute for Management Development (IMD), 2005 30

Malaysia’s Competitiveness Disadvantages WEF Growth Competitiveness Index Rank WEF Business Competitiveness Index Rank 24 Malaysia’s Competitiveness Disadvantages WEF Growth Competitiveness Index Rank WEF Business Competitiveness Index Rank 24 23 Notable Competitiveness Disadvantages (position out of 117 countries) Macroeconomic Environment Company Operations and Strategy Government surplus/deficit – 96 Nature of competitive advantage – 54 Government debt – 49 National Business Environment Public Institutions Extent of bureaucratic red tape – 101 Irregular payments in public utilities – 47 Centralisation of economic policymaking – 80 Irregular payments in exports & imports – 45 Others Irregular payments in tax collection – 36 Freedom of press – 83 Organised crime – 31 Telephone/fax infrastructure quality – 45 Technology Prevalence of trade barriers – 38 Gross Tertiary enrolment – 63 Informal Sector – 37 Telephone lines – 61 Reliability of police services – 37 Foreign ownership restrictions – 37 Source: World Economic Forum (WEF), 2005/06 31

Global Competitiveness: Stock Market Perspective (% of GDP) Value Traded (US$ per capita) Listed Global Competitiveness: Stock Market Perspective (% of GDP) Value Traded (US$ per capita) Listed Domestic Companies Stock Market Index 1 10 2 2 53 1 9 1 3 10 40 Singapore 13 27 5 14 16 38 Taiwan 15 15 9 10 14 56 Japan 31 2 25 16 5 52 Malaysia 25 26 3 34 11 39 Korea, Rep. 37 16 31 23 7 47 Thailand 17 33 21 35 18 58 Indonesia 39 42 51 56 21 12 Capitalisation Stock Markets Financing (US$ bn) United States 2 Hong Kong Countries Source: Institute for Management Development (IMD), 2005 32

Global Competitiveness: Stock Market Perspective Countries Shareholders’ Rights Financial Institutions Transparency Cash Flow United Global Competitiveness: Stock Market Perspective Countries Shareholders’ Rights Financial Institutions Transparency Cash Flow United States 10 16 9 11 27 7 15 Hong Kong 25 8 1 1 21 1 16 Singapore 23 13 4 6 35 13 28 Taiwan 48 32 7 21 1 3 22 Japan 54 49 20 33 41 35 29 Malaysia 34 40 51 25 31 Korea, Rep. 46 35 28 35 53 24 36 Thailand 39 30 21 32 50 32 34 Indonesia 51 51 53 55 54 59 60 Source: Institute for Management Development (IMD), 2005 Corporate Factor. Debt ing Adaptability Ethical of Practices Companies 33

World Bank: Doing Business Global Index Start business no. of procedures Getting licence (days) World Bank: Doing Business Global Index Start business no. of procedures Getting licence (days) Cost of license (% of income per capita Registering Property (days) Singapore 3 129 24 9 Australia 2 121 12. 3 32 Hong Kong 5 230 38. 5 83 Korea 12 60 232. 6 11 Thailand 8 147 17. 3 2 China 13 363 126 32 Taiwan 8 235 250. 9 5 Malaysia 9 226 82. 7 143 Country Source: World Bank, 2006 34

Bottom Line: Malaysia already has the Plans + HR + Infrastructure to be IFC Bottom Line: Malaysia already has the Plans + HR + Infrastructure to be IFC • Its not about Vision, Mission or Infrastructure • Advantage 1: We have spent RM 3 billion and 10 years to make Labuan a viable Offshore Financial Centre • Advantage 2: KL has the lifestyle and infrastructure to be attractive Asset Management Centre for Asia • Advantage 3: Malaysia is already leading Islamic Banking Centre • Advantage 4: Over 15, 000 Malaysian professionals in Hong Kong alone, excluding Singapore and elsewhere global talent is recruitable • Advantage 5: Malaysian costs are lower than other regional financial centres. EXECUTION and IMPLEMENTATION is key to success. 35

Finance is not a zero-sum game in Asia. Malaysia can offer niche services at Finance is not a zero-sum game in Asia. Malaysia can offer niche services at lower costs • Malaysia can be Global Islamic Financial Centre watch the competition. • KL can be Asset Management Centre for Asia Labuan is already booking centre. • We can be outsource subcontractors in accounting, secretarial, cartoons, sound, film, book production etc to high cost centres. • Need focused implementation and constant benchmarking to international standards, plus partners from all over the world. • Outsourcing and Services business needs widespread and stable broadband. 36

Development and Growth is a Process: To have Sustainable Growth, you need a Process Development and Growth is a Process: To have Sustainable Growth, you need a Process to Manage Development Process • Development is complex, because those who face most problems are those who are closest to the problem [the poor, SMEs, private sector, grass root public servants]. • It’s not about QUANTITY OF GROWTH, BUT QUALITY. • In the past, development has been top-down. Aid, not trade. Today, we understand that we have to use market forces to lead growth. • Therefore, the key to sustainable growth is to have inclusive, transparent and accountable processes to manage the growth process. • This is a co-operative venture, not public-private competition. This includes using national + global talent 37 and skills.

ABC of Knowledge Economy ACADEMIA - Holders of Knowledge, but bogged down in teaching. ABC of Knowledge Economy ACADEMIA - Holders of Knowledge, but bogged down in teaching. Segmented from market or government BUSINESS - Close to market, but do not use Academia for R&D and sees Civil Service as hindrance rather than partner CIVIL SERVICE - Holder of massive public information and resources that can help growth. Currently, rarely uses Academia for R&D and policy work. Focuses more on regulation rather than BUSINESS facilitation. Competing internationally means that transactions costs of doing business and “time to market” in Malaysia must come down. Its all about teamwork. We have to operate as truly Malaysia Inc. 38

Change Management is Tough • Clarity of Role and Objectives • Rules have no Change Management is Tough • Clarity of Role and Objectives • Rules have no meaning unless they are enforced • It’s the outdated processes that must change • Prioritization of “Doables” • Getting staff and public buy-in • The whole world is adjusting - pain is inevitable • Deliver small winners to achieve credibility the big winners will take care of themselves 39

Focus and Prioritize “Pick important problems and fix them and tell everyone”. . “The Focus and Prioritize “Pick important problems and fix them and tell everyone”. . “The essence of the [regulatory] craft lies in picking the right tools for the job, knowing when to use them in combination, and having a system for recognizing when the tools are inadequate so that new ones can be invented. ” Professor Malcolm Sparrow, The Regulatory Craft, Harvard University. 40

Fixing the Problem u Old-style regulators: “Nitpicking, unreasonable, unnecessarily adversarial, rigidly bureaucratic, and incapable Fixing the Problem u Old-style regulators: “Nitpicking, unreasonable, unnecessarily adversarial, rigidly bureaucratic, and incapable of applying discretion sensibly. ” u It is often the obsolete and defective systems, not the people, that create problems. u Change is the constant. Be prepared to change. 41

Enforcement of Laws, not Laws per se, is critical OECD - “Too often, legislators Enforcement of Laws, not Laws per se, is critical OECD - “Too often, legislators issue laws as symbolic public action, rather than as practical solutions to real problems. Regulatory inflation erodes the effectiveness of all regulations, disproportionately hurts small and medium businesses, and expands scope for misuse of administrative discretion and corruption. ” 42

Implications for Johore • Johore has huge advantage by being next to Singapore, which Implications for Johore • Johore has huge advantage by being next to Singapore, which is already an IFC. • Key is connectivity: reduction of friction costs to and from JB - Singapore. Stable broadband enables outsourcing from Singapore to Johore. • In RMK 9, notice that MRT is being considered. Can MRT link to Singapore be considered to enable flow of people and ICT pipes? 43

Implementation of 9 th Plan will focus on Southern Johor Economic Region • RM Implementation of 9 th Plan will focus on Southern Johor Economic Region • RM 12. 2 bn allocated to develop SJER, building up Nusajaya, Danga Bay waterfront, a transport hub and high speed rail link from JB to Kuala Lumpur. • 6, 480 ha of land will be developed in Nusajaya, housing Johor’s new administrative centre, universities, theme park and industrial/residential estates • Logistic hub will include Tanjung Pelepas, Senai Airport and Pasir Gudang. 44

FIRST CLASS SERVICE • As small open economy, Malaysia has already reached Middle-Income Status. FIRST CLASS SERVICE • As small open economy, Malaysia has already reached Middle-Income Status. We are caught in middle bulge. Not big enough to have economies of scale, but not too small to be marginalized. • Korea learnt key lesson from Asian crisis: the governance structure of DEVELOPED COUNTRY status is very different from EMERGING MARKET status. Korea paid for this lesson. • Go for quality of service, not quantity. Go for value, not size. Quality of governance at both public and private sector key to success. • To reach 2020 DEVELOPED economy status, we are already benchmarked against global standards. 45

Thank you Questions to as@andrewsheng. net 46 Thank you Questions to [email protected] net 46