right method to use, as it does not solve the fundamental problem, namely incorrect assessments of credit and risks and the lack of capital in the banks to cover losses. furthermore, i can see a number of risks if this proposal were adopted, although i will return to that later. i would first like to accentuate the widespread and laborious work carried out for many years, on both a national and international basis, to promote stability and prevent crises from arising, but without impairing the functioning of the markets. experience shows that a necessary condition for avoiding crises is to pursue a fiscal and monetary policy that is aimed at creating stability and that inspires confidence. the common denominator for countries that have experienced financial crises is that the problems were based on mistakes in economic policy and deficiencies in regulatory frameworks. the financial market is often merely the messenger illustrating the fundamental problems. it is important that the choice of exchange rate regime is in line with the economic policy pursued and with the capacity of the economy to adapt. countries that have experienced currency crises during the 1990s have had fixed, but adjustable, exchange rates. today, therefore, an increasing number of countries choose to have either floating exchange rates with inflation targets, or completely fixed exchange rate regimes, such as currency boards. experience also shows that it is necessary to have a general regulatory framework that is applied properly, and that contains norms and institutions, in order for both national and international financial markets to function well. countries therefore cooperate in international organisations, such as the bis, the central banks'organisation in basel, to work together on producing norms for suitable regulations and norms in various fields important to financial stability. great progress has been made in this field in recent years, both in agreeing on norms and implementing them. for instance, norms have been produced for payment systems, accounting and auditing, bankruptcy legislation, transparency in fiscal and monetary policy and measures against money laundering. when i was the nordic - baltic representative on the imf's executive board, we worked hard to establish norms for correct and detailed reporting of economic statistics. the world bank, the imf and other organisations support countries wishing to adapt their legislation to meet the norms, by assisting with expert help. several swedish experts take part in this work. it is in the interests of all nations to apply these jointly agreed norms, as this reduces the risk of financial crises. in addition, countries that do not follow the norms will find it more difficult to borrow on the international capital market,

njuguna ndung ’ u : a new agricultural finance training programme for kenya remarks by prof njuguna ndung ’ u, governor of the central bank of kenya, at the launch of the certificate in agricultural finance ( caf ) and the east african agricultural finance network ( eaafn ), kenya school of monetary studies, nairobi, 7 september 2011. * * * the hon. minister for agriculture, dr. sally kosgei ; the secretary general, east africa community, amb. dr. richard sezibera ; permanent secretary, dr. romano kiome ; usaid east africa regional director, lawrence meserve ; chief executive officers of commercial banks ; esteemed members of afraca ; distinguished participants ; ladies and gentlemen : good morning : hon. minister, about a year and a half ago, on 17th march 2010, we gathered here to discuss innovative ways to increase financial flows to the agricultural sector. the delegates in that meeting identified limited human capacity in agricultural lending as an impediment to financing the sector. the kenya school of monetary studies was tasked to address this human resource gap amongst lending institutions. ladies and gentlemen : i am pleased to inform you that after extensive consultations with key stakeholders, the school with the support of usaid - competitiveness and trade expansion project ( compete ), developed a modular certificate training program whose launch we are all here to witness. i wish to commend the team that steered the process of initiating this important program. in order to further develop this sector, this committee has been transformed into the east african agricultural finance network ( eaafn ) with a view to nurture, deepen and consolidate the sector ’ s capacity building agenda. hon. minister, i also recognize the presence, at this forum, of the inaugural class of the regional certificate program in agricultural finance. i hope the course is has met your expectations. hon. minister, ladies and gentlemen : the rapid growth of microfinance suggests that there may be a large market for rural and agricultural loans. it is therefore important to better understand the demand for and use of agricultural credit to develop effective products, institutions and policies. that is why the caf program mainly targets staff working in the credit and product development units in regional commercial banks, agricultural saccos and micro - finance institutions. hon. minister, ladies and gentlemen, let me conclude by again expressing the central bank of kenya ’ s appreciation of various institutions that have enabled the development of this capacity building