markets'banking sectors, volatile financial markets and downward revision to growth projections. over the past year, the sarb has been highlighting the financial stability risks associated with ongoing electricity - supply shortages, an upward repricing in government debt, south africa's greylisting by the financial action task force ( fatf ) and the impact of escalating geopolitical tensions, notably between russia and ukraine. the sarb has, however, marked some key milestones in the past year that will bolster confidence and trust in our financial system, starting with the establishment of the corporation for deposit insurance ( codi ) as a legal entity on 24 march 2023. as the newest subsidiary of the sarb, which will become fully operational in april 2024, codi will protect covered depositors in the event of a bank failure. alongside this, the sarb became the resolution authority for designated institutions on 1 june 2023, which will help protect the financial system in the event of failures of systemically important financial institutions. prudential regulation another cornerstone of financial stability is effective regulation of our financial institutions. several local institutions facing particular circumstances were put under curatorship in the past year. south africa's banking and insurance firms, as well as its market infrastructures, remain sound. in the wake of fatf greylisting the country, the prudential authority continues to work with other regulators and law enforcement agencies to address the remaining gaps in south africa's oversight of money laundering, the financing of terrorism and proliferation financing. operational matters at an operational level, the sarb met several milestones during this past year, which serves as a testament to our values of accountability, excellence and integrity. the sarb's role as the steward of our country's national payment system ( nps ) is too often overlooked. the nps is, however, a critical infrastructure of the economy, and the sarb works hard to modernise the nps and make it more secure, more efficient and more accessible. in september 2022, we successfully migrated to the international organization for standardization's ( iso ) financial messaging standard : iso 20022. the adoption of iso 20022 enables richer, better - quality data in payment processing and settlements, and is a significant step in the modernisation of our payments ecosystem. a key operational development during the year was the transition to a new monetary policy implementation framework ( mpif ). between 8 june 2022 and 24 august 2022,

. the monetary policy adjustment was the most limited and gradual in recent history, with the repo rate rising by just 2 percentage points over 27 months. at 7 %, which is where we are now, the policy rate remains quite low from a historical perspective. meanwhile, although fiscal policy has become less expansionary, deficits have remained larger than 3. 5 % of gdp over the past three years. these deficits have been 3 in gross debt terms, as a share of gdp, government ’ s debt stock was 26. 5 % of gdp in 2008. in 2016, it was 50. 5 % of gdp, and imf forecasts indicate that it will reach 52. 5 % of gdp in 2017. page 3 of 10 more than simply the unfortunate consequence of low tax revenues caused by slowing growth. in structural terms – that is, correcting for the economic cycle – south africa ’ s fiscal deficit has still averaged about 3 % over the past three years, according to imf4 estimates. 5 as an illustration, 3 % is greater than the output of the entire agriculture, forestry and fishing sector ; it is a large amount to borrow every year and it injects substantial spending into the economy. south africa ’ s macroeconomic settings also look accommodative in comparison with those of other countries. in fiscal terms, most of our peer countries have borrowed less heavily. amongst the major non - oil commodity exporters, south africa ’ s average postcrisis deficit is larger than any country ’ s except brazil ’ s. 6 indeed, not only have many of our peers achieved smaller deficits than we have ; sometimes they have even managed budget surpluses. for example, chile, colombia and peru all exploited the post - crisis rebound in commodity prices to balance their budgets. 7 if anything, south africa stands out for running consistently large budget deficits despite historically high commodity prices. the result has been higher debt service costs and reduced fiscal space. in monetary policy terms, south africa more closely resembles its emerging market peers. most of these countries began tightening policy around 2013 or 2014. some of these countries faced inflation well above their targets and therefore raised rates sharply. the most prominent cases were brazil and russia, where policy rates went up by 700 and 1 150 basis points respectively. where the inflation challenge was less extreme, smaller adjustments were possible. colombia, for instance, tightened by 450 basis points, indonesia by 200 basis points, and chile by just 50 basis points.