ariff ali : reserve bank of fiji august 2016 – july 2017 annual report presentation by mr ariff ali, governor of the reserve bank of fiji, to the standing committee on economic affairs, suva, 5 april 2018. * 1. * * introduction thank you honourable chair, and honourable members for the invitation to present the reserve bank of fiji ’ s annual report for the period 1 august 2016 to 31 july 2017, to the standing committee on economic affairs. i had presented an extensive background to the standing committee last year on the role of central banks, and the functions of the rbf as stated in the rbf act and the 2013 constitution. however, i would wish to re - iterate as stated last year that central banking is not for the faint of heart as alice rivlin so aptly said, “ the job of the central banks is to worry ”. honourable members, as i had highlighted in my presentation to you in 2017, the rbf is tasked to maintain : ( i ) price stability – ensuring that inflation is low and stable ; ( ii ) external ( currency ) stability – that foreign reserves level are comfortable ; and ( iii ) financial stability – that our financial system is strong and robust. 2. key outcomes honourable chair, please allow me to first provide highlights of the outcomes of our 2016 / 2017 operations, before i respond to the questions from the standing committee : ( i ) financial performance as we have highlighted previously, the objective of the central bank is not to maximise profit. while profit maximisation is not our goal, making losses is also not acceptable. as an important policy making institution, financial losses often results in reputational risk which then translates into loss of confidence from our key stakeholders. honourable chair, for the financial year in review, the rbf made a profit of $ 28. 3 million and transferred to government a total of $ 29. 4 million which included one - fifth or $ 2. 1 million of the revaluation reserve account ( rra ). of the $ 28. 3 million in profits, the rbf board with the approval of the minister transferred $ 1. 0 million to the general reserve account to strengthen the reserve bank ’ s capital base. this is similar to how private companies retain dividends or earnings to strengthen their capital positions. this compares with a transfer of $ 16. 9 million to government ( $ 13. 9 million profits and onefifth raa totalling $ 3. 0 million ) for the

some gender based propositions. the female members of our team have made it to the senior positions that they hold, through merit, and they are supported the same way as we support our male members. bis central bankers ’ speeches however, like many other organisations, we also have our share of challenges and continue to invest in empowered and accountable leadership through tailor made leadership training programmes, as well as receiving regular guidance from the board and the governors. we also wish to highlight that the rbf continues to promote merit based individuals into its leadership team while ensuring gender diversity in its key roles. in line with this, the rbf had issued a press release on 3 february 2017 on a call to action for greater participation and representation by women of merit on the boards of listed companies of the south pacific stock exchange. we believe that gender diversity is a key indicator for good corporate governance, and the bank will continue to collaborate with stakeholders in support of fiji ’ s national gender policy and the achievement of sdg 5 of gender equality. for other local institutions, it would be of immense benefit if a merit based culture is inculcated in the organisation, and fairness and honesty guide decision making on leadership positions. institutions will also need to invest in high - quality leadership training and be specific with leadership qualities they wish to have. the top echelon of the organisation structure will have to show interest in the continuous development of their senior and middle management, and ensure that effective succession planning is in place. [ vii ] on page 60 – statement of cash flows – there seems to be a lot of movement between the figures of the seven month period ended 31 july 2016 and year ended 31 july 2017 i. e. net movement in short term commercial paper, net movement of domestic securities, net movement in demand deposits. we realise that one report is just a 7 month period and the other covers 12 months, however, the differences are still large. please give us some insight into why the big differences. the movements noted in the statement of cash flow reflect the changes ( increases / decreases ) in the bank ’ s financial position as at 31 july 2017 compared to the same period in 2016. the underlying reason for the movement in cash flow is the increase in total external reserves which rose from $ 1, 982 million to $ 2, 314 million ( page 68 note 5 ). the reduction in short term commercial papers from $ 376. 2 million to $ 257. 8 million can be explained by a rise in the current account