united states treasury and other government agencies. these services include the processing of government payments as well as the creation, safekeeping, and transfer of book - entry records detailing ownership of the public debt. as an extension of these fiscal agent duties, the federal reserve also seeks to promote the efficient operation of the government securities market. fourth, the federal reserve oversees private clearing and settlement systems and provides payment services, principally fedwire. these services are central to overall financial stability because disruptions in payment systems have the clear potential to impair the functioning of the financial sector and the real economy. moreover, a major financial or operational problem at a key institution in a securities settlement system can also spill over to the payment systems that it uses and thereby have systemic repercussions. finally, to enhance the general welfare of the us economy, the federal reserve promotes the efficient functioning of the payment system and helps to supply payment services. a secure, fast, and reliable payment and settlement system is a key element in a modern economy. through its payment system development committee, the federal reserve seeks to address emerging payments - related issues. the basic aim of this committee is to work with the private sector to advance the use of electronic payments throughout the us economy. in taking the step to t + 1, the us securities industry will be assuming an important leadership role in the evolution of securities settlement systems around the world. i should also note that implementation of a shorter settlement cycle is consistent with the position taken by the international securities services association ( issa ), the securities industry ’ s own review body. in a set of recommendations this association released earlier this year and discussed at a session of the sibos conference last month, issa explicitly calls for adoption of a t + 1 settlement cycle in its member countries. i would like to make clear that the federal reserve supports the sia ’ s effort to adopt the t + 1 settlement cycle. faster, more reliable, and more cost - efficient processing of securities transactions is desirable for several reasons. first, high or excessive transaction fees may serve to distort or hinder financial activity. inefficient trading and settlement arrangements used by the secondary market for securities could discourage the use of securities relative to other financial instruments. the choice of instrument should be based on the needs of borrowers and investors. second, inefficient settlement arrangements may interfere with active risk management. high settlement fees could discourage institutions and portfolio managers from taking full advantage of advances in risk management

loi m bakani : creating a favourable environment for innovative credit supplementation institutions ( csi ) in the asian region keynote address by mr loi m bakani, deputy governor of the bank of papua new guinea, at the 16th asian credit supplementation institutions training programme, port moresby, 13 - 14 september 2006. * * * introduction distinguished guests, participants, observers, ladies and gentlemen, thank you for inviting me to address the 16th asian credit supplementation institutions confederation training programme. i am informed that it is the first time that such training is held in papua new guinea. i am thankful to the organisers for selecting papua new guinea as the host of this year ’ s training programme, and it ’ s a challenge for the small business development corporation ( sbdc ) to ensure a successful hosting of the training programme. the programme comprising of lectures and workshops, will run for two ( 2 ) days. most of you are in our country for the first time, and the organizers have been kind enough to include extra days for visits to the national museum and the national parliament. a special arrangement was made for the participants to see the popular hiri moale festival and 31st independence anniversary celebrations. i extend our warmest welcome to you all and hope you will enjoy your stay in our capital city, port moresby and see some of our diverse cultures and traditions. the training theme “ creating a favourable environment for innovative credit supplementation institutions in the asian region ” is an exciting one. under this main theme, the scope of the workshop has been broadened to include presenters to share their expert views and knowledge on related subject matters, including : • impact of globalisation on small and medium enterprises credit in the asian region ; • innovative policies and practices of credit supplementation institutions in the asian region ; and • financing small and medium enterprises through credit guarantee schemes. the above sub - themes of the workshop are included to provide an objective and comprehensive coverage of the global issues impacting on the growth of the small and medium enterprises in some parts of the asia - pacific region and lack of progress in the other parts of the region. to start the discussions on the above sub - themes, let us look at a number of critical problems and issues affecting the advancement of small and medium enterprises in the wake of globalisation. these include, but are not limited to : small and medium enterprises policy and implementation ; regulatory framework ; entrepreneurial / managerial skills ; finance ; technology and information resources. impact of globalisation