UNLOCKING INTRA-ASEAN INVESTMENT OPPORTUNITIES KEY TO REGIONAL INTEGRATION -- BNM GOVERNOR

KUALA LUMPUR, Feb 25 (Bernama) -- Intra-ASEAN investment opportunities remain largely untapped and significant efforts are still needed to achieve regional regulatory alignment, said Bank Negara Malaysia (BNM) governor Datuk Seri Abdul Rasheed Abdul Ghaffour.

He said BNM’s vision is for the financial sector to play a pivotal role in driving the next phase of economic integration under the ASEAN Economic Community 2045.

This, he said, would require the sector to strategically harness three driving forces -- funding, technology and talent. 

“Let us start with funding, which is a crucial driver of ASEAN economic growth. ASEAN is facing significant funding gaps that demand our urgent attention,” he said in his special luncheon address at the 2025 ASEAN Banking and Finance Summit here today.

Abdul Rasheed emphasised that the financial sector lies at the core of ASEAN’s progress over the years. The sector acts as a central engine of the economy, facilitating flows within ASEAN.

Indeed, he said, over the last few decades, ASEAN has made progress in facilitating regional capital flows, connecting its payment infrastructure and introducing a framework to support the integration of the banking system through the ASEAN Banking Integration Framework.

Citing the Asian Development Bank report, he said ASEAN economies will need infrastructure investments of at least US$2.8 trillion from 2023 to 2030 to sustain economic growth, reduce poverty and respond to climate change.

“Key projects in the region that require large financing include the ASEAN Power Grid, which is pivotal to advancing the region’s climate and energy security agenda and the various ASEAN highway and railway projects such as the Asian Highway Network, which are cornerstones of regional economic development and integration,” he said.

Moreover, he said ASEAN micro, small and medium enterprises also face a daunting financing gap, exceeding US$300 billion annually and these figures underscore the urgent need for strategic investments and collaborative efforts to secure a resilient and sustainable future for ASEAN.

“This need is even more pressing in a region where over 90 per cent of all social infrastructure development has traditionally relied on public resources and public funding faces increasing constraints,” he said.

In the private sector, leveraging public, private and philanthropic finance sources, along with development finance, can be a key strategy to attract additional private capital for sustainable development in ASEAN.

He said the financial sector is pivotal in advancing blended finance to meet funding gaps in ASEAN by enabling acceptable risk-taking levels based on various funding sources.

“This approach leverages the willingness of development finance and also philanthropic funders,    including sovereign funds within ASEAN, to assume greater risk exposure, utilising tools like partial credit guarantees to attract additional investors,” he said.

During the upcoming ASEAN Finance Ministers' and Governors' Meeting Week from April 7 to 10 this year in Kuala Lumpur, BNM will host several events to advance these discussions.

These events include a closed-door investor rendezvous focused on innovative financing solutions for accessible ASEAN green and transition projects as well as pitching sessions on sustainable ASEAN  projects.

-- BERNAMA