fossil fuels. this transformation will reduce dependency on fossil fuels. it will mitigate the financial risk of rising energy prices. i am optimistic that european companies will use their innovative strength to adjust their business models. today's topic is " changing or pretending – between ambition and reality ". it is difficult for the real economy and the financial sector to show proof of real change. one tool that can help corporates to show this proof is corporate transition plans. corporates set out transition plans to explain their transformation strategy. they publish their strategy for the next 5, 10 or 15 years. not just in prose but with facts and clear figures, so that investors will see whether a corporate is about to change or just pretending. 2 well begun is half done – benefits of transition plans ladies and gentlemen, many companies have pledged to achieve net - zero emissions by 2050. but as the motto of this conference suggests, ambition and reality do not necessarily match up. i know this from personal experience, so allow me to stray for a moment. new year is approaching fast, so i want to share my new year's resolution with you. i want to brush up on my french skills. i know that without a rigorous action plan my resolution might be shelved before i even pick up the first french book. but there's a huge difference between new year's resolutions and net - zero pledges. not sticking to a new year's resolution is not the end of the world. missing climate targets has far greater consequences. good forward planning is essential. to turn ambition into reality, companies need a concrete, medium to longer - term action plan. in other words, they need a transition plan that outlines clear milestones and intermediate targets. transition plans are the chance to break the tragedy of the horizon by aligning long - term commitments with concrete action today. a clear roadmap will make it easier for companies to manage risks that will come with the transition. and it will help them to seize the opportunities presented by the transition. because rethinking business models can open up the potential for more efficient processes, new products, and new markets. transition plans also provide valuable signals to stakeholders when it comes to securing financing. banks and other financial stakeholders are increasingly scrutinising their corporate clients'transition strategies. they want to see more than just lofty targets and pledges, and demand concrete steps. this is especially relevant for companies that are not green yet or those that might never

collaboration among all stakeholders. ▪ prospects in the medium to long - term are very positive. need to continue with the reform process can hardly be overemphasised. state of the local economy ( cont. ) status of debt service ▪ in quarter 1 of 2024 debt service was only to multilateral and plurilateral institutions. ▪ in the second quarter, there was a sharp upward jump following the conclusion of restructuring of the commercial ( eurobond holders ) as broader debt service resumed ( see chart below ). liquidity risk secondly, the industry ’ s concerns on liquidity risk is noted. however, it is important to fully appreciate the context that informed boz actions. ▪ the environment has for sometime now been characterized by strong underlying inflationary pressures, stemming not only from the debilitating drought shock of 2023 / 24 agricultural season, but also the persistent exchange depreciation. ▪ managing such pressures points to the need to implement relatively tight monetary policy to contain the inflationary pressures. ▪ we are the first to admit that the policy rate, on its own, is not sufficient to manage exchange rate pressures. the bank has had to complement the policy rate changes with upward adjustments in the statutory reserve ratio. in this regard, in early february 2024 we raised the srr to 26 % from 17 % on 5 february 2024. ▪ at the same same time it was deemed necessary that the government transfers its unutilised deposits from commercial banks to the boz. thus, on 29 january 2024, commercial banks were instructed to transfer such deposits to boz. ▪ the increased statutory reserve ratio resulted in a net withdrawal of k8. 1 billion of excess liquidity. with respect to government deposit transfers, between endjanuary 2024 and july 2024 k3. 4 billion had been transferred to boz — far much less than the projected k12 billion. liquidity risk ( cont. ) ▪ the less - than - satisfactory performance of the government deposit transfers meant that the impact was not fully achieved. with this development another way of achieving the intended objective had to be found. the bank turned to making overnight lending facility ( olf ) as the main source of commercial banks ’ liquidity as opposed to use of regular open market operations ( omo ). ▪ upon observing relative stability in the foreign exchange market conditions since june 2024, the bank started to provide commercial banks liquidity relief through the much cheaper omo facility compared with the olf