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"Payment systems could similarly be linked up as a network, hopefully on real time," said the Chief Executive of HKMA, Mr Joseph Yam, in delivering his speech at the 29th Annual Meeting of the Board of Governors of the Asian Development Bank (ADB) this morning in Manila.

The sound market infrastructure is crucial to the development of financial markets, he said, citing the example of the Eurodollar bond market which took off in 1968 when Euroclear was established to facilitate book entry clearing and settlement of Eurodollar bond transactions.

In Hong Kong, the domestic bond market blossomed when HKMA installed an efficient debt securities clearing system.

"Hong Kong stands ready to pursue linkages with other markets, either on a bilateral or on a multilateral basis, in building up such networks," said Mr Yam.

"The ADB, as the premier financial institution and bond issuer in the Region, should explore and support the development of this AsiaClear and other financial infrastructural networks."

The development of AsiaClear could help improve resource mobilisation or financial intermediation in Asia, a matter of strategic importance to this Region, Mr Yam said.

The ADB has estimated that the requirement for infrastructure investment in Asia would reach US$280 billion a year, or over a trillion US dollars to the year 2000.

By comparison, domestic savings in the Region seem inadequate notwithstanding the high savings rates of over 30 per cent of gross domestic product and very substantial reserves of over US$600 billion in Asia.

"In short, the framework of financial intermediation in the Region is not as effective as the situation demands." said Mr Yam.

"I believe strongly that in the area of the development of financial markets and their market infrastructure, domestic authorities do have important responsibilities to carry."

End