fiu presentation to iba members opening speech delivered by mrs. l. matroos - lasten acting president centrale bank van curacao en sint maarten on the occasion of the information session on : aml / ctf within the international banking sector centrale bank van curacao en sint maarten december 12, 2018 ladies and gentlemen, good evening, i would like to express my gratitude to the association of international bankers ( iba ) for its initiative in organizing this important seminar titled aml / cft within the international banking sector. i am pleased to share my opening remarks with you. this year marks the 10 - year anniversary of the global financial crisis. if we learned anything from the crisis, it is that international cooperation and policy coordination is crucial to shape a sound, transparent, and attractive financial system. as the managing director of the international monetary fund ( imf ), christine lagarde, stated “ the time to fix the roof is when the sun is shining. ” that is to say, we should not wait for ( reputational ) storms to come our way to act agile. ladies and gentlemen, our financial sector is of integral importance to achieve sustainable economic growth. suffice to say is that, though its contribution has declined over the past 20 years, the international financial services sector remains a key economic pillar of curacao. the ifs sector generates about 6 % of foreign exchange earnings, provides labor intensive high - skilled employment to more than 1, 000 persons, and contributes approximately 6 % of gdp. in addition to these direct effects, the sector has indirect spillover effects across related industries, including the business, telecommunication, transportation, and hospitality sectors. amid the increased complexity of financial transactions, it has become imperative for financial intermediaries such as international banks, to keep re - inventing themselves through new and innovative products and services. simultaneously, the supervisory role of the central bank is to ensure proper controls to prevent systemic collapse and achieve market integrity. today, i would like to touch upon the history of the international financial services ( “ ifs ” ) sector, the main challenges this sector is facing, what we have achieved so far, and what our next steps are. ladies and gentlemen, first allow me to take you back to the history of the ifs sector. by mid - 1960s curacao had become a well - known international financial center for purposes of global tax planning. however, the prosperity of the

that its effectiveness can differ considerably depending on the type of conditionality attached to the policy rate path. in particular, time - based guidance provided over relatively short horizons appears to be rather ineffective in reducing market uncertainty. conversely, the evidence indicates that rate forward guidance over long horizons, or state - based guidance, is more effective in reducing the sensitivity of asset prices to macroeconomic news. the state - contingent formulation links the governing council ’ s expected interest rate path to at least two conditions regarding the inflation outlook. first, inflation has to “ robustly converge to a level sufficiently close to, but below, 2 percent within our projection horizon. ” second, this convergence needs to be “ consistently reflected in underlying inflation dynamics ”. the first condition is forward - looking : inflation has to be seen to be converging to a level sufficiently close to 2 percent well before the end point of the horizon : this is the meaning of “ robust convergence ”. the second condition is backward - looking : we have to see the robust convergence in future inflation confirmed and verified in actual measures of underlying inflation. importantly, the decision we took last september has established a unified framework for our forward guidance across policy instruments that links the horizon of both our net asset purchases and reinvestments to our forward guidance on the rate path : net purchases are expected to continue until “ shortly ” before we start raising the key ecb rates ; and reinvestments are expected to run “ for an extended period of time past the date when we start raising the key ecb interest rates ”. whereas the forward guidance on the rate path acts on the expectations component of longer - term rates, the asset purchases especially affect term premia, as i will discuss in more detail later on. evidence suggests that the enhanced forward guidance we introduced last september is well understood by market participants. the interest rate lift - off dates in survey - based measures largely coincide with the time at which inflation expectations two years ahead – the horizon of the ecb / eurosystem staff macroeconomic projections – are around levels close to, but below, 2 percent. this indicates that the link between our interest rate forward guidance and the inflation threshold is understood. more than that, thanks to its state - contingent nature, our rate guidance provides an automatic stabilisation mechanism that steers rate expectations – and expectations about our asset purchases – as a function of the evolving inflation outlook. in practice, we have seen this automatic stabilisation function of our forward guidance operate effectively