It is not surprising that the Central Bank of Turkey, one of the most important institutions of the Turkish economy, which hopes to become integrated with the western economies, is affected by these trends in modern central banking as it maps out its medium and long-term strategies. Accordingly, the main goal of the Central Bank of Turkey, like that of other central banks, should be to maintain the stability of prices in the economy. At this stage I would like to clear up two points with respect to the price stability target. First, the Central Bank’s price stability target and its responsibility for price stability are two different issues. The price stability target assumes a stability which exists under conditions of low inflation. Therefore, the economy has to undergo a “ disinflationary process” before the Central Bank assumes responsibility for price stability. It is well known that in Turkey, which has been experiencing high inflation for years, reducing inflation to the levels of the western economies will require a comprehensive effort and is not a process which can be accomplished by the Central Bank alone. The Central Bank can track the price stability target as a part of the larger disinflationary programme. I believe that once low inflation rates have been achieved by means of such a programme, it will be a rational decision to make the Central Bank responsible for maintaining price stability. The second point I want to stress concerning the price stability target concerns microeconomic functions of central banks.

Enhanced tax transparency lifts the veil on structures created for illicit purposes, and will help to deter tax criminals from abusing trust structures. This bodes well for the longer term sustained growth of the trust industry. The critical role of industry 24. An AML/CFT regime, no matter how robust, cannot in itself fight against ML/TF activities. We need the commitment and active participation of the industry. Promoting a strong AML/CFT culture within the industry, and deepening manpower capabilities are important elements to maintain a robust regime, and allow us to reap the benefits of business growth while managing risks effectively. 25. Industry has primary responsibility to build a good AML/CFT culture and ensure compliance. I am encouraged that the industry has taken active steps to promote robust controls to strengthen its resilience and prepare for increased transparency on beneficial ownership information and enhanced tax transparency. The private banking industry in Singapore introduced a set of industry sound practices last year to provide guidance to private banks on the development and implementation of robust controls to detect and deter the proceeds of tax crimes. As most of you would know, the Singapore Trustees Association has also issued similar guidelines for trust companies. We commend such industry initiatives and look forward to continue working in meaningful partnership with the industry. 26. Competency building is also imperative in raising AML/CFT standards amongst industry professionals. An effective AML/CFT system cannot be solely the responsibility of compliance professionals or experts, but must be an integral part of the firm’s culture.