denny h kalyalya : 60 years of central banking - repositioning for sustainable and inclusive growth in a digital world speech by dr denny h kalyalya, governor of the bank of zambia, at the tree planting exercise to commemorate bank of zambia's 60th anniversary, mumbwa, 21 august 2024. * * * salutations his royal highness chief mumba his royal highness chief moono his royal highness chief mulendema mumbwa district council chairperson, mrs chali masumo the district commissioner, mrs namukulo hayumbu deputy governor a€ “ administration, mrs rekha chifuwe mhango council secretary area councillors national heritage conservation commission board member - commissioner muliokela directors from the bank of zambia and national heritage conservation commission representatives from various government ministries distinguished invited guests members of the media ladies and gentlemen good morning it is my honour and privilege to warmly welcome you all and express our gratitude for joining us this morning in the tree planting exercise. this is no ordinary exercise for us. it forms part of our 60th anniversary commemoration. for those among us who didn't know, the bank of zambia was established on august 7, 1964, some two months ahead of our country being declared independent on october 24, 1964. to commemorate this major milestone, we thought of doing something out of the ordinary which contributes to the sustainability of the environment we live in. in this vein, we coined the theme of our 60th anniversary celebrations as, " 60 years of central banking : repositioning for sustainable and inclusive growth in a digital world. " accordingly, leaning on the united 1 / 3 bis - central bankers'speeches nations'sustainable development goal ( sdg ) no. 13, which encourages all of us to take action against climate change, we decided to undertake an eco - conscious initiative to plant trees to mitigate the impact of climate change. distinguished guests, the need to reduce emissions from deforestation cannot be overemphasised. you will agree with us that the forest eco - system in zambia is threatened by land use practices that do not take into account the protection of forests. for society to reach inclusive and sustainable growth, economic agents must participate in economic activity without harming the environment. distinguished guests, as we gather this morning, we recognise that our environment is facing numerous challenges, from deforestation to climate change related ones, which are becoming more frequent and severe. it is, therefore, our collective responsibility to address the challenges we

to the financial reforms, following the 2008 global financial crisis, that were coordinated through the fsb. however, there is no room for complacency. financial institutions and market participants have not experienced sharply rising interest rates for a long time. very low interest rates may have become embedded in business models, making the adjustment to a world of higher rates challenging. companies and households that have borrowed money will also need to adjust to higher interest payments, and problems may materialise only with a lag. so, we need to remain vigilant. a deterioration of banks'asset quality may still occur, and other vulnerabilities, like the ones on today's agenda, need to be monitored closely. some of these vulnerabilities may have been previously prevented from materialising by authorities'covid - 19 support measures. but now these measures are being lifted. so it is important to address debt overhang issues of non - financial corporates, and to respond to potential issues of underinvestment due to excessive indebtedness or misallocation of resources to unviable companies. all of these are what i would call cyclical vulnerabilities. but, more fundamentally, we also need to be wary of vulnerabilities that stem from structural shifts in the global financial system. 3 / 6 bis - central bankers'speeches so allow me to say a few words on three structural shifts that the fsb is currently focusing on, and the associated vulnerabilities. it is, of course, no coincidence that the topics of today's panels overlap with many of the fsb's priorities. first – the structural shift in the provision of finance from banks to non - banks. in our global monitoring report on non - bank financial intermediation, from december 2022, we highlighted that the nbfi sector reached 239 trillion us dollars in 2021. if a number on that scale is hard to put into context, a more telling figure is perhaps that the nbfi sector increased its relative share of total global financial assets to 49 % in 2021, compared with 42 % in 2008. almost half of all global financial assets are now being intermediated by non - banks. while diversifying the sources of credit can make the global economy more resilient, the growth in nbfi has exposed important vulnerabilities in the non - bank sector. we have seen the problems that these vulnerabilities can cause several times in recent