samchain/econo-pairs-v1 huggingface dataset:
This was deliberately undertaken since the inception of Islamic finance in this country to sustain the soundness and stability of the system and thus the confidence of the financial community. Reinforcing this is the Islamic Financial Services Board (IFSB) as the international standard-setting body of the prudential and supervisory framework that was established in 2002. The balanced regulatory approach being applied also aims to ensure that the trust and efficiency of doing business is maintained. In undertaking a holistic approach to drive the MIFC initiative, the Government has streamlined the associated delivery system to facilitate advancing the MIFC agenda with the formation of the MIFC Executive Committee. The Committee comprises a high-level group of 28 top officials from the key relevant Ministries, Government departments and agencies, financial and market regulators and representatives from the banking and takaful sectors. Through the shared vision and commitment, this Committee is responsible for providing the direction as well as undertaking a review of all existing policies that are relevant for the comprehensive and coordinated promotion of the MIFC. Two meetings thus far have been convened and several issues have now been resolved with solutions provided to several key implementation issues which ranged from foreign ownership to immigration policies. The Secretariat, formed by Bank Negara Malaysia will not only serve the Executive Committee but will also act as a single contact point for the implementation of the MIFC initiatives.

Since this is not the main topic of our discussion today, I will simply give a brief reminder of the facts.   The role of central banks in markets stems from their objectives, the primary one incontestably being to ensure price stability. But this is not their sole objective. As we know, the Fed operates under a “multiple mandate” that is, and I quote, “to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates” whereas most other central banks, and in particular the ECB, have a “hierarchical mandate” that places the price stability objective above all other policy goals. More specifically, the Maastricht Treaty states that “without prejudice to the objective of price stability, the ESCB shall support the general economic policies in the Community with a view to contributing to the achievement of the objectives of the Community”. In that perspective, one of the objectives of the Community that we must support is to “promote solidarity among Member States”.   In order to fulfil its mandate, central banks must be credible and thus independent. If economic agents have the least doubt or the least suspicion that the institution might have an incentive to surprise them by allowing high inflation, they might adjust their behaviour as a precaution and thus “create” higher inflation by increasing their wage claims, thereby triggering a wage-price spiral; or by demanding greater returns on their savings, which pushes up long-term interest rates and weighs on growth.
The treatment of intra-bank exposures may pose challenges especially in the emerging markets where banking systems rely markedly on the parent funding (intra-bank funding will be treated as funding from external third parties and their maturity will have to be extended – netting out at consolidated level is not allowed). Other question is the treatment of liquidity transfer restrictions. Excess liquidity in one entity would not be recognized when calculating the consolidated LCR if there is a reasonable doubt about the availability of such liquidity (due to ring-fencing measures, non-convertibility of domestic currency, foreign exchange controls etc. ).This may lead to fragmentation of the liquidity management, replication of the treasury operations at decentralized level with cost implications. The growth impact of the regulatory changes is of large importance for the emerging markets, as they aim towards financial inclusion, development of financial markets, long-term sustainable growth and real convergence to the more AE’s. Two of the most important points which have been extensively discussed in the growth context are the regulatory impact on trade and long-term infrastructure finance. Trade finance has been considered as the most important facilitator of the trade flows in part of the emerging markets and hence as an important growth factor within this group of countries. Some of the estimates point to a figure of 80–90% of the world trade being reliant on some form of trade finance, like trade credits or insurance/guarantees.

Who better to speak to us this evening on this topic than Otmar, with his extraordinary talent for communicating with an interested general public? Ladies and gentlemen, please join me in welcoming Otmar Issing with a big round of applause. Page 4/4
2  BIS Review 71/2008  transmitted via financial markets to the real economy and to prices. 4 Monetary policy therefore strongly relies on well-functioning and liquid markets. The tensions in the money markets in recent months therefore posed a serious headache to most central banks. Not only did money market tensions indicate potential problems for financial stability, but it also threatened the smooth functioning of the transmission mechanism of monetary policy. The second important point concerning the transmission of monetary policy is the fact that it is not the current value of the policy rate that matters. Rather, it is the expected future path of that rate that determines the stance of monetary policy. For example, a central bank can have an impact on the economy simply by signalling that its own view about the future path of the monetary policy rate is different from the current market view. If the central bank is credible, market expectations will adjust correspondingly and financial prices will henceforth reflect the new view communicated by the central bank. 5 3. Chronology of the crisis  After these preliminaries, I will now turn briefly to the origins and the course of the financial market crisis, and in particular, the liquidity tensions brought about by the turmoil. The US housing market stands at the epicentre of the financial market crisis. After rising for several years, US house prices peaked in 2006.

Central bank action is a first-aid kit to ensure that the patient does not die on the site of the crash from a loss of blood, but the subsequent healing process is up to the patient. Taking moral hazard into account The final lesson concerns the moral hazard problem arising from liquidity management operations. Roughly speaking, moral hazard is the name we give to the situation in which, financial institutions and investors incur higher risks than they would otherwise because they expect the central bank to intervene in times of crisis. This, in turn, may increase the likelihood of future crises. Moral hazard is relevant both at the level of systemically relevant market players and at the level of markets as a whole. Market participants that are “too big to fail” or “too interconnected to fail” may automatically factor in the help from central banks when deciding about their business strategy. However, smaller players and investors that cannot count on individual help may also take the expected central bank reaction to financial market crises into account in their investment decisions. BIS Review 71/2008  7  Because of moral hazard, central bank intervention in order to safeguard financial stability in the short term may be destabilising in the long term. Therefore, when reacting to a financial crisis, the benefits of central bank intervention in terms of short-term stabilisation must be weighed against the long-term cost in terms of moral hazard.
For this purpose, we interacted with the IMF, which had already begun reflecting on the issue, and had ended setting up, in collaboration with the World Bank, the Bali Fintech Agenda, presented during the last annual meetings held in October, in Indonesia. 2  It was then an opportunity to converse with the staff of the department headed by Mr. Tobias, with whom I agreed to organize a regional meeting to follow up implementation of this agenda, which the Fund had initiated in Vienna early this year. Today, this agenda has become a reference used to address the problem in a structured and standardized way. I will not go through the details of this agenda, first because I think that Mr. Tobias is better placed than me for this, and second because the issue will be discussed thoroughly in the different sessions of this conference. Rather, my aim is to focus on the technological revolution, particularly its impact on the financial sector, then to discuss the challenges it poses for public authorities in general and for central banks in particular. Ladies and Gentlemen, In the aftermath of the 2008 crisis, while public authorities and international institutions, including the IMF, were concerned about the repercussions of the crisis, a different evolution was taking place and began to gradually transform the economic, financial and social landscape.

Also, inflation levels would be overestimated because of the improved quality of goods and services, not taken into consideration in their calculation. Another field where major changes are induced by this revolution is data production and use. Big data generated by new technologies are at the heart of the strategies of economic and social actors, both public and private. Their exploitation takes many forms such as customizing services and targeting messages to guide the behavior of the consumers or of the public opinion in general… The case of Facebook-Cambridge Analytica during the last US presidential elections offers an uplifting illustration in this regard. 4  Conversely, the impact of this revolution turns out to be rather positive on the administrative procedures, such as tax payment. In fact, benefits are multiple: reduced costs, increased transparency, and the fight against tax evasion and corruption reinforced. To sum up, I will recall one of the main conclusions of the 2016 World Bank's World Development Report on “the digital dividend”. Digital technologies and innovations have undoubtedly helped improve growth and services supply by substantially reducing the costs of economic and financial transactions, but the aggregate impact is still limited and unevenly distributed. Ladies and Gentlemen, I think that we all agree that one of the areas where technological innovation is growing rapidly is the financial sector, with a new term being even dedicated to it, the Fintech. The latter is revolutionizing the financial landscape, by expanding products and services, improving their quality, and making them more accessible and less expensive.
Europe accounted for 9,404 followed by Zambia (residents) at 7,308 while North America, Rest of America and Australasia were 4,016, 2,810 and 1,412 respectively. The rise in the entries into the country’s national parks was in part attributed to the world cup and improved weather conditions. External sector developments Foreign exchange market The slow pace of economic recovery in the United States continued to cast a dark shadow on the US dollar, the world’s most traded currency. The lingering economic uncertainty and the burgeoning fiscal deficit drove the US dollar weaker across all currencies. Therefore, benefitting from the broad based dollar weakness and relatively high levels of US dollar liquidity in the market, the Kwacha posted a 5.0% gain against the American currency. A sustained rise in the copper prices at the London Metal Exchange to an average of $ per tonne in the third quarter from $ tonne gave further support to the domestic currency, with the interbank rate ending the period at an average of K4,869.21 per US dollar. The weakness in the US dollar saw the Euro and the pound sterling rebound, underpinned by austerity measures instituted in Greece and the United Kingdom and favourable bank stress test results in the European Union banking sector. Reflecting this recovery, the South African rand, which tracks the euro, also performed well, posting significant gains in the currency market. These developments saw the Kwacha depreciate against the three currencies during the review period.

The Business Sector: To bolster the business sector’s resilience, be it SMEs or larger firms, the Committee sought to reduce its financial burden by providing the required cash flow to cover regular contractual liabilities, such as salaries and rent, as companies lost all revenue due to the lockdown. This was accomplished through a set of measures, among which was the deferment of loan payments due to the National Fund for Small & Medium Enterprise Development (National Fund) and the Industrial Bank, plus providing concessionary loans to SMEs through joint National Fund-bank financing according to mechanisms and controls laid down by the Committee. Although this mechanism was approved by the Council of Ministers, implementation was not feasible due to difficulties on the part of the National Fund. Accordingly, the National Fund was officially directed to take the appropriate measures to guarantee support to the vital SMEs segment which falls within its mandate, as the country looks to SMEs for more job opportunities for Kuwaitis and to contribute to the diversification of the national economy. As for concessional financing for corporate firms and individuals negatively impacted by the crisis, banks had in fact already started extending financing and giving concessions, either in line with this measure or their standing credit policy, and had also injected more liquidity into the sector. Furthermore, the Central Bank of Kuwait instructed the banking sector to abstain from sale of or enforcing of any measures on or liquidating collateral held by banks.
Second, the same is true, by and large, if we move from regions to sectors. There are some reasonably marked differences in average levels of productivity across sector. For example, manufacturing is on average around 35% more productive than construction. Nonetheless, these differences are dwarfed by variations within each sector (Chart 22b). Each has a long, thin upper tail and a short, fat lower tail. Whatever is driving slower rates of technological diffusion, sector-specific technologies are not it. Third, if we look at the external-facing profile of firms, we begin to uncover some important differences (Chart 22c and d). Firms which export have systematically higher levels of productivity than domestically-oriented firms, on average by around a third. The same is true, even more dramatically, for foreign-owned firms. Their average productivity is twice that of domestically-oriented firms. This is not altogether surprising. Firms that export are likely to be exposed to global competition and many are integrated into global supply chains. This increases incentives to boost efficiencies and to match international best practices. 53  The self-same forces are likely to be at play among foreign-owned firms. The  productivity benefits these external-facing firms bring underscore the importance of openness to trade and foreign direct investment in generating rising productivity and living standards over time. We can quantify these benefits by looking in more detail at the relationship between firms’ productivity and their export share (Chart 23). There is a positive and statistically-significant relationship.

BIS Review 164/2009  3  dollarization of the Antillean economy, as they thought it sensible to first investigate the situation of similar countries with an experience in dollarization. To my knowledge, no followup has been given to this study. The discussion was again brought up in 2005 when it became clear that Curaçao and St. Maarten would become separate entities within the Kingdom, while the BES-islands (Bonaire, Saba and Statia) elected to become an integral part of the Netherlands. De Nederlandsche Bank (conditionally) advised to form a monetary union between the various islands instead of dollarizing the economy. This was in full conformity with the recommendation made in 2004 by the working group on governmental and financial relations headed by Mr. Jesurun). 2 De Nederlandsche Bank also mentioned that a credible and independent central bank is important when forming a monetary union and that the BNA has proved to be well-equipped for this task. 3 7. Concluding remarks  In view of the forthcoming changes in the Kingdom’s Statutes, Curaçao and St. Maarten will have to decide on a very short term what to do with regard to their legal tender. Although these islands are deemed too small to justify the costs associated with maintaining a local currency, our experience in Aruba, which entails the existence of a local currency linked to the US dollar and a credible central bank, gives us strong arguments to continue with our dollar-linked florin.
For domestic institutions that particular issue was settled by the Banking Act 2009, and the new resolution powers were successfully deployed by the Bank to deal with the Dunfermline Building Society in March. What other powers are required? There is a broad consensus that our traditional policy instruments need to be augmented by a “macro-prudential” toolkit. But what are such “macro-prudential” instruments for? Are they to increase the resilience of individual banks, or are they to protect the economy from the banks? The former implies a sensible extension of the current regime of capital requirements for individual institutions. The latter goes to the heart of the problems caused by the financial sector as a whole for the rest of the economy. We need to reflect more deeply on the nature of the failures before designing a regulatory response – after all many financial markets continued to function well. But banks entered the crisis with historically low levels of liquid assets, and inadequate levels of capital with which to absorb losses. Moreover, in the United Kingdom, the financial sector became too big and too highly leveraged. First, the size of our banking system was, as a proportion of GDP, five times that in the United States, and the risks to the UK taxpayer correspondingly greater. Second, the process of reducing very high leverage is doing great damage to the rest of the economy.

And the required adjustment still has a long way to run – few of the largest banks in the United Kingdom managed to reduce their leverage ratios through 2008, which remain at historically high levels. Third, interconnections between institutions create potential fragilities across the system, as we saw last September. Fourth, the risks associated with large-scale proprietary trading are probably harder to control in limited liability companies. So we need instruments to prevent the size, leverage, fragility and risk of the financial system from becoming too great. The resulting “macro-prudential” toolkit will contain a number of instruments to reduce risk, both across the system and over time. It must not be put together in a hurry. And I share the concerns of many of you that we are a long way from identifying precise regulatory interventions that would improve the functioning of markets. As far as individual banks are concerned, we face some uncomfortable choices about the structure and regulation of our banking sector. If some banks are thought to be too big to fail, then, in the words of a distinguished American economist, they are too big. It is not sensible to allow large banks to combine high street retail banking with risky investment banking or funding strategies, and then provide an implicit state guarantee against failure. Something must give.
Sunil Mendis: Is it time for a common currency in the SAARC region? Inauguration speech by Mr Sunil Mendis, Governor of the Central Bank of Sri Lanka, at the 15th Forex Conference of the Forex Association of India, Colombo, 20 August 2004. *  *  *  It is with great pleasure that I accepted the invitation from the Forex Association of India to inaugurate its 15th Annual Forex Conference here in Colombo. I would like to extend a warm welcome to this distinguished gathering of forex professionals from Sri Lanka as well as from many of our neighboring countries. I am sure that this is an excellent opportunity for all of us to promote goodwill among ourselves. It also gives us an opportunity for sharing our thoughts on the way forward for South Asia’s currency and financial markets, which is the theme of this year’s conference. Forex, as you very well know, is the largest financial market in the world. Unlike many other markets, the international forex market is open 24 hours a day. Its daily turnover is well over $ 1.2 trillion. This turnover is more than the combined turnover of the world’s major stock markets on any given day. Hence, the international forex market is a very liquid, and thus, a desirable market for trading. As with any other market, technology has also contributed immensely towards its expansion. Now trades are executed increasingly through the internet. It has allowed even smaller investors the access to the market.

As conservative central banks, our involvement in the forex markets is limited to strategic investments and stabilising the exchange rate. Following this role, the Central Bank of Sri Lanka does not get involved in speculative type of trading. However, it plays a major role in the development of the country’s forex as well as other financial markets. We know that in a market-oriented economy, all financial market segments, namely, the foreign exchange market, money market, government debt securities market and the stock market are inter-linked. The Central Bank, while watching the operations of each market segment individually, needs to take a macro view of all the market segments to ensure financial market stability. The focus today, however, should be on the foreign exchange market. In the exchange rate area, it is appropriate to mention at this juncture, Sri Lankan authorities made a fundamental change to its policy on 23rd January, 2001 by moving to a freely floating exchange rate arrangement. This was necessitated by the inability of the then prevailing exchange rate system and the crawling band regime to sustain themselves. Immediately after the float, the market experienced some volatility as is usually expected. However, this volatility has been contained overall since then. This, not only brought confidence to the market, as evidenced by increased foreign exchange inflows, but also allowed greater flexibility and market opportunities to foreign exchange dealers of commercial banks.