great majority of the population, living in the rural areas. for the bank's part, we realize that with the first lng project and the likelihood of more lng projects, the economy will enter a new era of economic growth. in its formulation and conduct of monetary policy the bank will carefully assess and evaluate the trade - off between higher economic growth and inflation so as not to discourage domestic economic activity and ensure inflation does not spiral out of control. it is very encouraging that the national executive council ( nec ) decided to set up a joint working group of very senior staff from the department treasury and the bank of papua new guinea to asses and evaluate the applicability of the sovereign wealth fund model, to prepare the country toward the times that the lng project will move into the operation stage of production and export. all the expectations are that when the lng project will move to the operation stage, the country will benefit from very large taxation, dividend, and royalty incomes. it is of outmost importance that the mistakes of the late 1980's and 1990's are not repeated. 6 / 7 bis - central bankers'speeches the working group is consulting with all the stake holders and get the best available advice, from domestic and international experts, to come up with the best structures known at the present to deal with large foreign exchange inflows. the last thing we should do is not to preempt the working group's deliberations and recommendations. the whole nation has a very strong interest and a lot at stake and we want to ensure that they come up with the best possible solutions to the two subjects they deal with ; the stabilization of the fiscal operations of the government and the savings for future generations, from a project of immense size and importance to the future wellbeing of all our nation. the government in close cooperation and consultation with all economic sectors and civil society, has the time to carefully formulate, and design the implementation tools and mechanisms of its development strategies and plans, to ensure that we commence an era of high economic activity and growth for the nation's future generations. thank you. 7 / 7 bis - central bankers'speeches

weather impacts. it provides additional – and important – security which also supports our kenyan economy. a great benefit for the development of micro insurance is the deepening of penetration per capita. currently most micro insurance schemes are run as small pilot type arrangements and continue to face a number of regulatory and operational challenges. i am informed that a policy framework paper has now been developed by the micro insurance working group set up by the insurance regulatory authority and the same has been forwarded to the ministry of finance for further attention. in this regard, the minister during his budget speech recognized micro insurance as a standalone class of insurance, giving it the prominence that is deserves. ladies and gentlemen, insurance penetration in kenya is 3 % – high by african standards, but with a long way to go still. i appeal to leaders and operators in the sector to harness the growth opportunities and to think forward, to think innovatively. for example, the recent discovery of oil and gas in kenya has marked a significant opportunity for this sector. we bis central bankers ’ speeches have had the chance to see how other african countries have tackled the discovery of important natural resources, and the onus is now firmly on us to learn from their successes, and from their mistakes. we know, for example, that there is long way to go to prepare our country for the technical intelligence required to provide security around the multitude of issues that accompany a discovery of this kind. i request the insurance and reinsurance market to test out the structures in place for oil and gas insurance. we need to be prepared as an industry and as a country in order that we safeguard against future potential issues resulting from the mining of our natural resources. in this regard mr. chairman, i wish to applaud continental reinsurance ’ s steps in progressing product innovation and development including oil and gas, and look forward to learning from your experience. lastly, ladies and gentlemen, i urge the insurance industry to position itself for the economic integration in the east african union. as you are already aware, the common market protocol of the east african community ( eac ) creates a big market full of opportunities. this is the way to go in terms of integration and expansion within the eac and beyond. indeed today ’ s occasion is a realization of that spirit as we congratulate continental re ( a nigerian company ) on their authorization to transact fully reinsurance business in kenya. this trend is the beginning of what i predict will be the future of the insurance and reinsurance market in