operation in the hemisphere. my remarks today reflect a long - standing tradition at the bank of canada of working with our central bank colleagues throughout the hemisphere. but beyond the bank's collaboration in the region, canada enjoys an enduring connection with the americas. more canadians now travel to latin america and the caribbean than to any other part of the world outside the united states. canada joined the oas and signed nafta in the early 1990s. our involvement with the americas has grown, encouraged by democratic transition, increased commercial and investment opportunities, and the movement of people. and canada's engagement will continue to grow. in a speech last month, our prime minister noted that canada " will seek to re - engage relationships throughout the americas, with our partners in mexico, the caribbean, and central and south america. " conclusion ladies and gentlemen, allow me to conclude. the prosperity that we enjoy in canada and the united states is a testament to the ability of free markets to generate wealth and raise living standards. we understand the gains that can come from building a strong global financial and trade order, backed by appropriate rules of the game. other governments have worked hard to engage in this global order because they, too, understand the benefits that it can bring to their citizens. we now face two challenges. first, we must think globally about how best to update the rules of the game to take into account the evolving nature of the global economy. second, we must act locally, within our own hemisphere, to help our neighbours to see that integration into the global economy is in everyone's interest. neither of these tasks will be easy. they will require patience and persistence. and along the way, we will encounter governments that are more inclined to withdraw from the process than to engage with the global economy. but we can't let the difficulty dissuade us from our goal. to the delegates at bretton woods, the task of rebuilding the world's economy must have appeared daunting indeed. and there were times when the political will to see this task through appeared to be lacking. but eventually, a spirit of co - operation overcame the obstacles, and policy - makers gathered around tables at international institutions and built a liberalized financial and trade order – an order that has led to the prosperity we know today. it is time to rekindle that spirit of co - operation and to build a table for the americas, so that the benefits of the global economy can be spread throughout our hemisphere

in monetary management monetary policy of pakistan now for some years has been largely supportive of the dual objective of promoting economic growth and price stability. it achieves this goal by targeting monetary aggregates ( broad money supply growth as an intermediate target and reserve money as an operational target ) in accordance with real gdp growth and inflation targets set by the government. qualitatively monetary policy formulation and its implementation has improved substantially, benefiting from the following actions. • first, legislative changes to the state bank of pakistan act has empowered the sbp and sbp central board to formulate, conduct and implement its monetary policy • second, a monetary and fiscal board has been set up to ensure formal monetary and fiscal policy coordination and this board is currently chaired by the prime minister in his capacity as finance minister with representation from economic ministries. • third, the fiscal responsibility and debt limitation act 2005 mandates a steady reduction in revenue deficit to zero by 30th june 2008 and maintaining it thereafter, and reducing total public debt to sixty percent of gdp by 2013 and below that limit thereafter. these two principal steps lay the foundation for reducing fiscal subservience of monetary policy that for years served to complicate monetary management and allowed the government unlimited recourse to low and fixed interest rate financing. • fourth, sbp continues to refine the institutional mechanism for monetary policy formulation and its regular review. for instance, sbp has replaced the open market policy and review committee by the monetary and exchange rate policy committee. this committee meets bimonthly to establish parameters of broad monetary policy and reviews monetary and economic conditions on a regular basis and recommends changes in monetary policy instruments. • fifth, sbp treasury's capacity has been strengthened to manage financial markets and related activities more effectively. proactive conduct of monetary operations and management of market volatility has helped improve market flows. the open market operation ( omo ) process has been institutionalized with better flexibility vis - a - vis tenors and frequency. from 1995 - 2005, sbp's monetary operations were focused on t - bill auctions and predetermined schedule of weekly omos of fixed tenors with no forecasting capability of market liquidity. this resulted in a high degree of volatility in overnight ( o / n ) & shortterm money market rates. during 2005, sbp treasury introduced the money market computerized reporting system ( mm - crs ) for banks which helped in not only assessing the market liquidity, but to improving the