to run faster and faster and, if not exactly go for gold, at least aim for seriously higher levels of foreign exchange reserves. others argue that we should run in more than one event, pursuing not only higher reserves but also more active management of the exchange rate. so it is worth being clear exactly what we can hope to achieve in this area of our operations, and equally what we cannot. we can, and will, continue gradually to build up our official foreign exchange reserves to a respectable level in an orderly fashion in accordance with our balance sheet whenever circumstances allow us to do this. this will bring benefits, as i have indicated, in terms of lessening rand volatility and strengthening our international credit standing. the scale of our operations is, in fact, cumulatively more substantial than is sometimes recognised : over the six years i have described above, we have acquired, directly by purchases in the market, or indirectly, of the order of $ 30 billion. around $ 10 billion of this has been acquired in the past eighteen months. these are not negligible sums, particularly in relation to the size of foreign exchange activity in the rand. in the process, our operations have undoubtedly provided some moderation to the rise of the rand we have experienced over the period. this has in degree helped to alleviate some of the strains exporters and our manufacturers have faced from the rise of the rand. we fully recognise the difficulty businesses face in adjusting to those strains, and it is useful that our operations can help in this way. but our operations have to remain focused on rebuilding our reserves. it would not be sensible for us to switch to a different focus, of seeking more actively to manage the exchange rate, principally for two reasons. first, neither we nor anyone can claim with any confidence to know what would be an appropriate equilibrium exchange rate. it is much more sensible for us to pursue a stable monetary framework aimed at delivering low inflation and thereby help the market find a stable trading range for the rand - as indeed it has managed to do for extended periods over the past year. secondly, endeavouring to manage the exchange rate would jeopardise our success in delivering low inflation : countless episodes in the past around the world demonstrate that attempting to switch focus to the exchange rate means that the central bank loses control of inflation, with seriously damaging results to the prospects for sustaining growth in the economy on a continuing basis. so we can, through our continuing operations designed to rebuild the reserves, help in the

the global economy. the economy has in fact achieved the remarkable record of registering continuous positive growth every quarter for the past 22 quarters. with inflation remaining under control, we are set to extend that record, as can be seen just last week by the further step we were able to take in reducing interest rates. a second feature of particular relevance has been the strengthening of the micro structure of financial markets in south africa, again designed to ensure that our markets meet normal established international standards. the well - constructed framework the national treasury has pursued in its debt management activities, the quality of the markets administered by the jse securities exchange, the bond exchange of south africa and the clearing and settlement agencies, and the oversight exercised by the regulatory authorities have all greatly improved the quality and liquidity of our markets and generated substantial international interest and participation in south african financial instruments. well - functioning markets encourage savings and, by matching savings with productive investment opportunities, help to bring down the cost of capital. we have seen the evidence of this in the diversification of issuers in the bond markets : alongside the government ’ s bond issues, corporate issues are growing rapidly, securitization is increasing and recently the municipal bond market has returned to life. this process undoubtedly has further to go and will help to provide the efficient structure of financial markets that are an essential support as our economy continues to grow. a notable further step in strengthening our financial infrastructure was implemented only last week, when our real - time wholesale payment system - samos - moved to same - day final settlement. this is an excellent example of how the steady and persistent commitment to normalising the structure and functioning of our economy can produce real gains that are often overlooked or under - recognised. samos, our real - time payments system, lies deep in the plumbing of our financial system. its functioning is a fascinating piece of advanced it engineering - at least for central bankers like myself and my colleagues at the national payment system department at the south african reserve bank, though i have to confess we have noticed that other people ’ s eyes tend to glaze over when we wax lyrical about the elegance of the system! what this seemingly technical step does is to remove a significant element of overnight risk for the financial system as a whole : we can go to bed, however late, knowing that all the day ’ s millions of individual payments have definitively been delivered and that all the resultant inter - bank olbigations have been settled finally and irrevocably.