workshop on the 22nd and 23rd of august to discuss the financial service sector assessment report. the report identified gaps and issues as to why 85 % of the population continues to be unbanked. we are currently formulating the “ national strategies on financial inclusion and education ”, with the aim to enable the great majority of the population to be financially literate and included in the formal financial sector. it was decided to establish a bis central bankers ’ speeches centre for excellence in financial inclusion ( cefi ) to be the national coordinating agent of all financial inclusion and education initiatives. the cefi was launched in april 2013 and its mandate approved by the nec in august 2013. the bank will also see to it that the payment system is low cost, efficient and provides all the necessary instruments that an advanced financial system needs. the new national payment system is at an advanced testing stage and planned to go live toward the end of 2013. the objective is to achieve real time settlement of all payments and transfers carried out by and through the financial system in png. thank you. bis central bankers ’ speeches

loi m bakani : papua new guinea ’ s economy and comments on the planned sovereign wealth fund address by mr loi m bakani, governor of the bank of papua new guinea, to the 2012 papua new guinea advantage summit, an international investment summit on papua new guinea, port moresby, 9 september 2013. * * * acknowledgments the organizers entitled my presentation as “ economic briefing ” and asked me to touch upon the “ sovereign wealth fund ”. i will do my best in the time allotted to me, to cover both subjects and more. i will commence with the subject of inflation : as you might know, the bank of papua new guinea ’ s ( the bank ) main role and objective, as is the case with many developed countries central banks, is “ price stability ”. only after this objective is achieved, and subjected to it “ to promote macro - economic stability and economic growth in papua new guinea ”. in the last four years 2009 – 2012, the bank of papua new guinea achieved its primary and secondary objectives, far beyond expectations. inflation was on the average 6. 4 % per annum. given the very high economic growth, as measured by the real increase in gross domestic product ( gdp ) of 9. 5 % in the same period, the inflation outcome is at the low end of our projections and expectations. the outcome we are still trying to fully understand is the very low inflation in 2012, of 2. 2 %. this trend continues in 2013 with inflation of 1. 6 % in the march quarter and 0 % in the june quarter, in spite of the devaluation of the kina since the last quarter of 2012. in the past, our analysis showed that the devaluation was one of the main causes of inflation. it may seem that the effect of kina devaluation is offset by low imported inflation because of low inflation in our major trading partner countries and slow down in capital inflow, and could be a measurement issue. at the present the bank ’ s projections show that inflation in 2013 will be around 5. 5 %. the bank ’ s assessment and analysis shows that the projection is on the high side. i state with confidence that, “ price stability ”, will be achieved. the second subject of my presentation is on gdp growth : as stated above, gdp growth in the last four years was 9. 5 %. present projections are for a 5. 2 % growth in 2013. this projection which