this challenge through multipronged strategy ; it is conducting various mass awareness programs and focused group discussions all over the country and supporting the industry and other related stakeholders for such initiatives. however, this is one area in which islamic banks have also to play a far more proactive role. ladies & gentlemen! as i mentioned earlier, standardization in islamic finance is essential for addressing various issues facing the islamic finance in addition to promote disclosure, transparency and integration into global financial system. i think the rapid growth of islamic banking and page 4 of 6 finance requires further strengthening of its financial infrastructure. this will augment the ongoing efforts to bring the infrastructure of islamic financial industry up to the international standards. the alignment of islamic finance industry with the global best practices would not only help supervisors in their tasks but will also foster the integration of islamic financial institutions into the international financial community. i would like to highlight here the commendable role aaoifi has played in development and promotion of shariah, accounting and governance standards to facilitate the growth of islamic financial services industry. aaoifi has also been instrumental in enhancing awareness of islamic banking and finance globally through knowledge sharing and organizing capacity building programs, workshops, conferences, and seminars. considering the constant changing dynamics in financial sphere, aaoifi also reviews and updates its standards to keep them relevant. aaoifi ’ s enhanced coordination with relevant stakeholders and increased collaborative efforts help islamic financial services industry to grow on sound footings. the aaoifi role in capacity building through offering shariah based certifications in the area of auditing, accounting and advisory services is laudable. such certifications provide the much needed qualified resources for effective implementation of the shariah standards. sbp has long standing association with aaoifi. as a member of the aaoifi ’ s board of trustee, state bank contributes in the overall oversight and supervision of its operations. our officials participate as both speakers and participants in different knowledge sharing and capacity building initiatives. so far sbp has adopted 6 of the aaoifi ’ s standards while another 8 to 10 standards are in the final stages of implementation. besides, sbp has advised the banks to refer the aaoifi ’ s standards for guidance in different areas of islamic finance. given the commitment and concerted efforts of all stakeholders, i am optimistic that islamic banking and finance is likely to maintain its positive growth trajectory. the growth of islamic finance on its distinct strengths would bring more stability to the financial system, improve equitable

niklaus blattner : current economic situation and monetary policy summary of a speech by mr niklaus blattner, vice - chairman of the governing board of the swiss national bank, at the 1st basel economic talks of the national bank, basel, 5 may 2006. the complete speech can be found in german on the swiss national bank ’ s website ( www. snb. ch ). * * * switzerland ’ s economy clearly picked up pace last year. exports were the main engine for growth, while construction and consumer expenditure also buoyed up economic activity. companies were nevertheless reluctant to invest or hire new staff. the recovery was thus still patchy, and inflation risks were accordingly low. since the beginning of the year, there has been a stream of positive news from switzerland and abroad. the us and asia are still enjoying a high level of economic momentum, and in europe, too, the recovery is becoming more firmly entrenched. benefiting from the favourable international environment, the upswing in switzerland has gained a broader footing. the investment environment in particular seems much more attractive now than last year. this applies especially to northwestern switzerland. many companies in this region have stated that they now want to implement investment plans that have been put on hold for a long time. the swiss national bank expects switzerland ’ s gdp to expand by just over 2 % this year. the economic upturn does not jeopardise price stability, at least not in the short term. in the long term, however, the current low level of interest rates is not compatible with price stability. if the economy performs as expected, the national bank will further pursue the gradual adjustment of its monetary policy that has already been initiated.