option is not available, because we produce only a handful of consumption items competitively, and most of those would become more expensive with currency depreciation, because of their import content. the caribbean policy maker has only one option for reducing spending on foreign exchange, and that is to reduce spending on everything. to stabilise these small open economies one has to cut expenditure in the aggregate. bis central bankers ’ speeches the tools available to reduce aggregate spending are all fiscal, and what is needed, in the end, is a reduction in the fiscal deficit. most of us, even those who remain wedded to conventional economic analysis, will be in sympathy with this conclusion. however, the conventional story, with its armoury of money supplies, excess liquidity, real effective exchange rates, core and headline inflation, etc, obscures the fundamental link between the fiscal deficit, external balances and foreign reserve adequacy. that linkage is what makes for the success of stabilisation policy. it may be employed to estimate the amount of fiscal adjustment needed for economic stabilisation, and equally importantly, to track the success of the fiscal adjustment measures, as they are reflected in the evolution of foreign exchange reserves. may i therefore take this opportunity to appeal for a practical approach to economics, one that 1. is based on careful measurement and observation of actual economic transactions and behaviour, even if that means we must rethink our prior notions ; 2. uses a variety of methodological approaches in the effort to understand better how our economies work ; 3. is sufficiently easy to understand and explain to economic agents whose decisions ultimately determine the success of policy ; 4. provides useable guidance about the magnitude of the policy adjustment that may be necessary. in a paper on fiscal sustainability that my colleagues anton belgrave, jason lacorbiniere, denisa applewhaite and i will present at this conference, we provide an example economic analysis which we believe is practical in this sense. in the panel discussion tomorrow i hope we can explore this question more fully. bis central bankers ’ speeches

reskill to strengthen workforce preparedness. as all of you know, retaining the right talent and investing in their development is much more sustainable and less costly compared to constant acquisitions to replace good talent that leave. consistently developing talent, succession planning, on - boarding, and having good corporate learning are all at the heart of successful high - performing organisations. good corporate learning and development strategies include customising learning pathways to close skills gaps, and providing career pathways that allow mobility and exposure, where people can learn different aspects of the business. third, like in other parts of our operations, organisations must leverage digital learning for greater impact. and yet, we should pay equal attention to human aspects that technology cannot replace, including executive acumen and leadership. the past year alone has seen the forced shift from traditional classroom learning to virtual channels. this has seen a surge in self - paced and online learning. with adaptive learning pathways that are powered by algorithms and ai, people can learn faster based on their own unique learning needs. but, when the situation permits, it will need to be balanced with higher interaction and face - toface learning especially in building executive skill sets. these include critical thinking and analysis, problem - solving, and skills in self - management such as active learning, resilience, stress tolerance and flexibility. for any organisation to grow and sustain change, strong, wellrounded leadership is critical. not all these aspects can be gained through formal learning alone. it has to be reinforced through robust on - the - job mentoring and organisational - wide coaching culture. finally, culture is at the heart of any organisation ’ s ability to transform and remain relevant. ron kaufman once said that when you “ convince people, you will win their minds. inspire people and you will win their hearts ”. for organisations seeking to transform and become more adaptive and innovative, culture change is often the most challenging part of the journey. any attempt to drive transformation is unlikely to succeed if there is resistance to the call for action. 2 / 3 bis central bankers'speeches as an organisation, bank negara malaysia has also had to assess and reflect on how we work, and consider better ways to instil the desired norms and corporate culture. what we have consciously nurtured over time has been a strong collaborative culture. what we want to keep getting better at is to be open to experimenting more, learning from mistakes quicker, and deepening our coaching and feedback culture. our policy mandates are stress - tested internally by a