4 / 12 / 2019 progress on benchmark reform | speeches | rba speech progress on benchmark reform guy debelle [ * ] deputy governor keynote at isda's 34th annual general meeting hong kong – 11 april 2019 good morning and thanks to isda for the opportunity to speak here today. it has been almost two years since andrew bailey announced that the fca ( the uk financial conduct authority ) would no longer use its powers to sustain libor ( the london inter - bank offered rate ) beyond 2021. [ 1 ] since that time, preparing for the end of libor has been a key challenge for the global finance industry. today i will provide an update on the progress with benchmark reform internationally, and highlight some of the key issues in the asia - pacific region. the end of libor there is now widespread recognition that libor will come to an end. the fundamental problem is that there are not enough transactions in the short - term inter - bank market to underpin libor. the banks that make the submissions that are used to calculate these benchmarks are uncomfortable about continuing to do this, as they have to mainly rely on their ‘ expert judgement ’ rather than actual transactions. to prevent libor from abruptly ceasing to exist, the fca has received assurances from the current banks on the libor panel that they will continue to submit until the end of 2021. but beyond that point, there is no guarantee that libor will survive. the fca will not compel banks to provide submissions and the panel banks may choose to stop. financial regulators around the world expect institutions using libor to be ready to transition to more robust benchmarks. if they haven't already done so, users need to identify their exposures to libor now and be working on transitioning to alternative rates. we know that a sizeable number of financial contracts referencing libor extend beyond 2021, including derivatives, bonds and loans. the transition will involve a substantial amount of work, both to amend contracts and update systems. the financial stability board's ( fsb ) official sector steering group ( ossg ) has been https : / / www. rba. gov. au / speeches / 2019 / sp - dg - 2019 - 04 - 11. html 1 / 6 4 / 12 / 2019 progress on benchmark reform | speeches | rba monitoring progress on the transition and on ensuring that contracts referencing libor include robust fall - back provisions. progress on adopting alternative risk

in the real sector, a number of african exports experienced an overall increase in prices in 2003. international gold prices increased, much to the benefit of the continents top producers, south africa and ghana. likewise, oil prices increased during the same period leading to higher revenues for countries such as nigeria, equatorial guinea, and chad ( adb, 2003 ). the developments in the middle east, iraq in particular have resulted in soaring oil prices reaching highs of about us $ 50 per barrel, due to the insecurity and uncertainty pertaining to the global oil supply. both gold and oil prices are expected to maintain high prices throughout 2004. increased foreign assets obtained from export earnings from the real sector will in effect improve the capability of oil exporting african countries to release more funds towards the achievement of their environmental goals. in line with the expectations of the heavily indebted poor country ( hipc ) initiative, many heavily indebted african states have cut their fiscal expenditure and are focussing on staying within their set targets. attainment of the hipc initiative completion point, will lead to the much needed debt cancellation by paris club members resulting in an overall improved financial position of these economies. failure to reach the target will however prolong reduced fiscal expenditure. despite the long - term economic benefits of the hipc initiative in achieving the mdgs, short and medium - term growth strategies of development concerning the environment and other areas will be constricted. 4. 1 prospects of economic growth the prospects for economic growth in africa remain bright. the african union ( au ) is currently making efforts towards ensuring political stability in the continent aimed at promoting both foreign and domestic investor confidence. international support of the new partnership for africa ’ s development ( nepad ) had led to some increase in aid in 2002 ; the trend was expected to continue in 2003 ( oecd, adb ). the future outlook in the performance of the real sector is set to improve due to : • low production costs ( labour, electricity, and water, among other inputs ) ; • comparative advantage in areas such as specialised agricultural production ; • numerous investment opportunities are available in the mining sector, which remains largely untapped, despite the richness and variety of minerals in africa. the scope for improvement of environmental sustainability in africa, hence economic growth is extremely vast ; • expansion of markets through regional integration within africa with necessary networks will facilitate for increased capacity utilisation among existing and potential productive businesses ; and • additional areas of improvement include the expansion