But more than that, it has the potential to help make Chongqing the beating heart of the Western Region. Let me suggest four areas of financial collaboration in the next phase of CCI. 2/5  BIS central bankers' speeches  first, unlocking private sector financing for infrastructure projects; second, expanding the role of capital markets in financing growth; third, developing risk management solutions to support investment; and fourth, strengthening financial capabilities and mutual learning. Unlocking private sector financing for infrastructure projects First, private sector financing for infrastructure projects, especially in the context of the Belt and Road Initiative. The CCI can serve as a key priority demonstration project to operationalise the Belt and Road Initiative. The Belt and Road Initiative is breath-taking in its strategic vision. At one level, it is about promoting economic growth in the countries of Asia through infrastructure development. The Asian Development Bank estimates that developing Asian countries will need to invest $ trillion annually in infrastructure until 2030 to maintain their growth momentum. But at a deeper level, the Belt and Road Initiative is about bringing together the countries of Asia through greater connectivity – deeper links of transport and communications, stronger flows of trade and investment, greater movement of people and ideas. The Belt and Road’s potential scope for connectivity is perhaps unmatched in human history. As an international financial centre in the heart of Asia, Singapore can play a useful role in financing and advancing Belt and Road projects, particularly in Southeast Asia.

This success has been achieved through ambitious professional and theoretical work which is one of the Bank’s main focuses. We became aware that other central banks following the same kind of policy had noted and commented on how carefully Iceland had prepared for the introduction of inflation targeting. It is aimed to strengthen the Central Bank’s research and theoretical work still further, and it is worth pointing out that the new legislation specifically states that it should undertake economic research relating to its tasks. Inflation targeting establishes itself Inflation targeting policies have established themselves in recent years, with a correspondingly large reduction in the number of countries which apply policies based on fixed but adjustable exchange rates, or exchange rates within a fluctuation range. The reason is not least that it proved increasingly difficult to adhere to a fixed exchange rate policy in a world of deregulated capital movements. It could be said that prevailing opinion identified only two possible exchange rate options: a floating exchange rate or a completely fixed one, for example through membership of a currency union, unilateral adoption of some other currency or establishment of a currency board. The new policy has produced good results and is applied in countries including Sweden, Norway, the UK, Australia and New Zealand, along with several countries in Eastern Europe, Latin America, Asia and Africa. It can also be argued that the European Central Bank partly follows the same kind of policy.