stability of the currency and currency arrangements ; • an extremely high level of monetization ; • a track record of financial stability and no major systemic crises as a result of effective supervision of the banking system ; • a good mix of foreign and local banks ; • high levels of management and banking skills supported by good training facilities ; • high level of technology and automation ; • access to information, domestically, regionally and internationally ; • a large pool of skilled workers to draw on through the local education system and graduates in the region and diaspora ; • proximity to the north eastern united states which is in the same time zone as the currency union. given this platform, it is now necessary that the financial sector should play a leading role in the development process. the strategic approach adopted by the eccb has been to move towards the creation of a single financial space through the removal of the legal and administrative barriers dividing the financial systems in each country and creating regional markets and institutions. the passage of uniform legislation has been the means by which barriers have been removed. banking, insurance, credit union and securities legislation has been drafted on this basis, and several administrative bottlenecks have been dealt with through mutual agreement. with respect to markets and institutions the following have been created over the last few years : • an inter bank market for liquid funds between the commercial banks in the currency union ; • a regional government securities market for treasury bills and bonds ; • a regional market for equities ; • a secondary market for home mortgages. with respect to institutions, there has been created : the eastern caribbean home mortgage bank ; the eastern caribbean securities exchange. two other institutions are now on the drawing board namely – the eastern caribbean enterprise fund ; the eastern caribbean unit trust. the former is intended to be a multi purpose institution providing venture capital services, debt instruments, technical assistance and export credit guarantees. this institution will seek to mobilize funding for small and medium enterprises within the currency union. the unit trust will seek to provide saving instruments of a wider range to low and medium range income earners who have very few options outside of the banking system. in addition to the above, the eccb has encouraged the formation of sector associations, for example, o the bankers association ; o the institute of chartered accountants ; o the eastern caribbean institute of bankers. the eccb now finds it necessary to proceed on the basis that there is an urgency to proceed with this programme of money and capital market development in order to position its member countries

significantly upgraded to provide the technological facilities for international connectivity. fifthly, the real estate sector needs to be able to respond to the needs of such a services sector by providing office space and residential accommodation as an attraction in and of itself. sixthly, the leisure industry which is a critical part of the tourism industry needs to provide first class facilities such as golf and yachting. seventhly, travel between the member states of the currency union needs to be seamless, that is, within the eccu, there should be no immigration or customs requirements, thus allowing the benefits to be more evenly spread. with these preconditions in place, both indigenous and foreign institutions will have the opportunity to provide the range and quality of services which will not only facilitate the effective mobilization and allocation of resources, but also to do so at a level which would make these services exportable beyond the currency union. for local financial institutions this will probably suggest that in addition to the natural moves to provide a variety of services on a local basis, they will have to engage in mergers and acquisitions across the currency union if they are to be nationally, currency union wide and internationally competitive. the timing of this next step could take place before all the barriers to a single financial space are removed or after that event. if one is to use the experience of other small countries, it is possible to envisage the type of financial structure that could evolve in the currency union over the near to medium term. there could be one or possibly two local financial conglomerates providing universal banking services and such other services as insurance, investment banking brokerage / dealers, etc. two major international banks, scotia bank and the royal bank of canada. a hybrid institution firstcaribbean international bank. the two regional banks rbtt and republic bank of trinidad and tobago. a growing number of foreign institutions in specialized areas to provide services both for the currency union and the regional and international community. the credit union sector will be consolidated both within individual countries and across the currency union and will provide a broader range of services to their clients. the insurance sector will also be consolidated in both the life and non life areas with local financial conglomerates being among the major providers across the currency union. the eastern caribbean enterprise fund would effect a major alliance with and consolidation of the development banks and development banking across the currency union. this new entity will in addition to its core function of financing development enterprises serve two critical functions. at the external level to be on interlo