taking in the banking sector. the result is familiar from many other countries today : a large current account deficit, a heavily indebted and uncompetitive economy and an overextended banking sector. then, the soviet economy collapsed at the start of the 1990s. this had a significant impact on finnish export industry and triggered a severe economic and banking crisis, which was at that time the most severe in the oecd countries since the second world war. dear colleagues, friends, the choice of title for this conference – “ monetary policy under resource mobility ” – reflects the central theme in the history of the bank of finland. it is also a central theme for all other central banks. the central bank works right at the nexus between the domestic economy, on the one hand, and global markets and policies, on the other. central banks have their responsibilities at both national and international level. when the world changes, the central banks are among the first to feel the changes ; they work inside the changes as it were, and they may even be able to manage them. at this time, the world economy is undergoing profound changes that pose formidable challenges for both central banks and economic researchers. we are witnessing a process of great convergence. in a few years ’ time the combined output of the emerging economies will surpass the output of the advanced economies when measured in purchasing power parities. it is not only about production of goods and services. it is also about capital. the emerging economies have become major sources of savings, and the equilibrium – or lack of it – of global supply and demand hinges on how the surpluses of some countries are channelled to other countries and used there. it is also about technology, which now spreads from country to country faster than before, narrowing productivity differentials and eroding the competitive position of many traditional centres of know - how. it is also about labour, as evidenced by migration flows and migration pressures across many borders in the world. i am very proud to note that our programme for tonight and tomorrow is filled with the world ’ s most distinguished academics and central bankers. bis central bankers ’ speeches we will start tonight with a session devoted to what we can learn from the economic history of globalization and global shifts. the topic will be introduced by professor barry eichengreen of the university of california at berkeley, and we are also very lucky to have three very special discussants, each of whom has an excellent vantage point over the global shifts that we are talking

norman t l chan : hong kong – an offshore renminbi business centre speeking points by mr norman t l chan, chief executive of the hong kong monetary authority, on the regulatory requirements for the adjustments to renminbi risk management limit and net open position, hong kong, 17 january 2012. * * * the development of hong kong as an offshore rmb business centre achieved encouraging results in the past year. trade settlement using rmb reached rmb2 trillion ; rmb deposits almost doubled ; and total issuance of dim sum bonds exceeded rmb100 billion. i am very confident that the trend of solid development will continue in 2012. with the continued growth in both turnover and depth of the offshore rmb ( cnh ) market in hong kong, the hong kong monetary authority ( hkma ) considers that conditions are now ripe to appropriately relax certain regulatory requirements on the rmb business of banks in hong kong. first, on the regulatory requirements of the rmb net open position, the hkma has decided to raise the limit for rmb net open position, from not exceeding 10 % to not exceeding 20 % of the bank ’ s total rmb assets or liabilities. second, currently the hkma requires each participating ai to maintain the sum of rmb cash or balances with the rmb clearing bank and the people ’ s bank of china, shenzhen branch, at no less than 25 % of its total rmb customer deposits ( referred as rmb risk management limit ). the hkma has now decided that participating ais can include two more types of rmb assets, namely “ rmb sovereign bonds issued in hong kong by the ministry of finance of china ” and “ rmb bond investment through the mainland interbank bond market ”, in the calculation of this limit. the above two relaxations take effect today. i believe they will help expand the scope of development for offshore rmb business in hong kong and provide banks with a greater flexibility in rmb asset management, which will be conducive to further development of the market. third, the hkma has imposed some restrictive arrangements on the inclusion of rmb assets as liquid assets in calculating the statutory liquidity ratio of ais. as the offshore rmb market in hong kong becomes more mature, i believe there is room for suitably relaxing these restrictions. since the adjustments to be made in the calculation are more complicated and technical, we shall announce the details later. bis central bankers ’ speeches