2007, adding significantly to the growth of real incomes over that period. by contrast, in the two years between late 2020 and the autumn of 2022, that relative price rose by over 20 % ( chart 4 ). this cost the country as a whole over 6 % of its national income. chart 4 : the pandemic and the war raised the uk ’ s import costs sources : ons and bank calculations. dotted line is the mpc ’ s may 2024 projection. some of that was absorbed by higher government borrowing ( used in part to fund subsidies for household energy bills ). the rest inevitably lowered the consumption value of profits and wages in the private sector. and it ’ s this hit to real incomes, and the attempt to offset it by bidding up domestic prices and pay, that can lead to the more persistent “ second - round ” effects on overall inflation. recently, based partly on the breakdown of the cpi – in particular the steep rise and fall in its goods component – economists at the bank raised their estimate of the direct contribution of tradeable prices to movements in inflation over the past three years. the resulting broad breakdown is shown in chart 5. chart 5 : most of the rise and fall in uk inflation accounted for by swings in prices of tradeable goods sources : ons, bank of england, bloomberg and bank calculations. the contributions of energy prices, tradeable prices and slack to the deviation of cpi inflation from target are bank staff estimates consistent with the mpc ’ s may 2024 inflation forecast. slack is based on the mpc ’ s estimates of the output gap. one consequence of this is that we now think there ’ s less of this effect to come through over the future. another is quite how much of the inflation in 2021 - 23 these direct effects seem to account for [ 3 ]. clearly, the tighter labour market also mattered ( its estimated contribution is represented by the purple “ slack ” bars ). but the vast majority of the inflation seems to reflect the direct impact first of higher core tradeable goods prices following the pandemic, then those of energy and food after russia ’ s invasion of ukraine. in particular, it ’ s really only in the past year, as those direct effects have fallen back, that any material “ second - round effects ” on domestic inflation have begun to emerge. that, at least, seems a reasonable interpretation of the gold, residual bars in chart 5. note that, consistent with this view, those gold bars broadly

, and makes the subsequent collapse all the more expensive. in addition to the ccl, the imf now has access to the nab funding, which together with the gab gives it around us $ 46 billion in available resources for crisis management. it now has its 11th quota increase in place as well, which lifts total quotas from around us $ 200 billion to us $ 290 billion. the unfinished debates relate to the role of the imf and world bank going forward, issues of representation at the key policy forums – the old established structures now in place in bodies like the imf and its interim committee now look to be thoroughly out of synch with the current global distribution of economic weight. for all of that, as the g22 / g33 progression showed, the old order is not yet ready to die. apec my final comments on this territory relate to the place of apec in this territory. much of the debate i have covered will emerge in a variety of guises within the apec finance process. this is primarily the responsibility of my treasury and mfat colleagues, rather than the reserve bank, so i will step only lightly here. the new zealand priorities for the apec finance ministers process will focus on three key themes : • • • open robust economies credible, effective processes, and strong global economies. under the first of these, finding ways to encourage the development of strong financial markets within the apec group is a key to meeting the long - term goal of open markets. apec will not be looking to duplicate work already taking place under the various umbrellas i have referred to. but it can draw on that work, and use processes such at individual action plans ( iap ’ s ) and voluntary action plans ( vap ’ s ) to give it momentum within apec. new zealand is promoting a vap on supporting freer and stable capital flows. this is split into two parts. part 1 is an information - gathering phase and has already started. it includes some work being commissioned from the imf on countries ’ experiences with capital account liberalisation ( including the efficacy of capital controls as a transition measure ), a pecc update of a 1995 survey of impediments to investment within each apec economy, and an adb study of the role played by capital in the economic development process along with work on reform sequencing. i understand that part 1 is intended to be completed in the next year or so, with a synthesis of the various studies