Challenges Maintaining macroeconomic stability is critical to sustaining economic growth in Zambia. The challenge is how to sustain stability and mitigate falling domestic demand within the constraints posed by increasingly scarcer external financial inflows. This has to be done in the context of implementing policies consistent with medium-term stability and development goals. The second challenge relates to mitigation of the vulnerability of the Zambian economy to the adverse external shocks. We will have to closely monitor capital flows and adopt supervisory policies that will ensure a sound and stable financial system. The pursuit of policies that promote macroeconomic stability is also important to ensure that the domestic economy remains attractive to both domestic and foreign investors for the long-term growth and development of the economy. One of the unfolding lessons of the current crisis is the need for greater transparency in the transactions players in the financial markets undertake, particularly, with respect to offbalance sheet transactions. We will therefore be acting to ensure that market players provide us with detailed information on their transactions. In addition, we will continue to work towards strengthening and developing our financial markets as well as encouraging competition and efficiency. Prospects for 2009 and beyond Your Excellencies, going forward, it remains important to accelerate diversification of the economy as a way to mitigate the effects of a prolonged global financial crisis. Currently, there are enormous business opportunities which still lie unexploited in Zambia in virtually all sectors of the economy.

We based our targeted loan approach on a framework that prioritizes the use of loans in areas of activity that support investment, production and employment. With our macroprudential tools, we also prevented the risks that credit growth may pose to price stability and financial stability. As another pillar of our targeted loan approach, we have effectively utilized advance loans against investment commitment with a grace period of two years and maturities up to ten years to encourage increased exports and investments in the production of import-substituting goods. Up to now, a total of TRY 111.47 billion in advance loans against investment commitment (YTAK) have been allocated to 740 industrial and tourism investments in 67 provinces. Moreover, we increased the limits, reduced interest rates and extended the maturities of rediscount credits extended to exporters and firms engaged in FX-earning services and activities, making this convenient financing opportunity more affordable and accessible. In addition, while changing company-based credit limits to Turkish lira in line with the Liraization Strategy, we decided that the rediscount credit limits allocated to banks be also revised to Turkish lira as of 2023. 2/4  BIS - Central bankers' speeches  In 2022, 346 billion Turkish lira worth of rediscount credits were used by our exporters. Facilitated access to rediscount credits led to a huge increase in the share allocated to SMEs compared to previous years. The number of SMEs using rediscount credits surged from approximately 1,900 in 2021 to 5,972 in 2022.