in the five years to 2014. vietnam and cambodia are examples of countries that have become more plugged into the global markets as a result of becoming part of this new regional value chain. bis central bankers ’ speeches • vietnam has emerged as a key assembly hub for electronic and electrical products. • cambodia has become a manufacturing base for chinese garment and footwear companies, with three - quarters of its garment and footwear exports in 2014 headed for europe and the united states. future of rmb internationalisation china has embarked on the formidable task of liberalising the capital account at a time when domestic growth is slowing, its financial system is still maturing, and us monetary policy is normalising. the process has therefore entailed careful calibration and periodic reassessment – crossing the river by feeling the stones. since 2010, the offshore rmb market has experienced remarkable growth, driven by strong investor appetite and cross - border trade. in the near term, however, the trajectory of rmb internationalisation is likely to moderate, due to a confluence of factors. first, global trade, which is a key factor driving the overseas use of the rmb, has declined. • merchandise trade flows between china and its trading partners are expected to be modest in the next year or so, reflecting cyclical headwinds. second, market expectations of china ’ s gdp growth affect expectations of the rmb ’ s appreciation or depreciation. • as the chinese authorities forge ahead with fostering a more market - based rmb exchange rate, greater two - way volatility can be expected, compared to what appears to have been a one - way trend appreciation in the past. • this could have a bearing on investors ’ expected returns on rmb deposits and financial assets, and therefore their demand for offshore rmb. third, the liberalisation of china ’ s capital account is likely to proceed cautiously in the near term. • policymakers will be more cautious in the short - term as they work to ensure that the market volatility and ensuing capital outflows in late 2015 and early 2016 do not have a lasting impact on market confidence. but i believe the chinese authorities remain committed to liberalising the capital account and promoting the international use of its currency in the medium term. • the latest 13th five - year plan, announced in march this year, has made clear the aim to reduce foreign exchange restrictions for both corporates and households and encourage the use of the rmb in cross - border

gent sejko : convergence process challenges facing south - east europe and albania speech by mr gent sejko, governor of the bank of albania, at the 7th ecb conference on central, eastern and south - eastern europen ( cesee ) countries on " institutional quality and sustainable economic convergence ", frankfurt am main, 5 october 2017. * * * accompanying slides honourable participants, it is a pleasure for me to participate in this conference, and discuss about the role of our institutions in the eu economic convergence process, such a relevant topic nowadays. i believe sharing our knowledge and experience in this area is extremely beneficial to all of us. my thoughts will be organized along three main dimensions. to begin with, i will highlight some of the challenges that the see convergence process is facing, from bank of albania ’ point of view. next, i will briefly describe how albania is positioned across these dimensions. lastly, i will try to emphasise how the convergence process itself can be enhanced to anchor our policymaking. 1. see convergence process challenges the long - term political future and economic prosperity of the see region is firmly linked to eu convergence and integration processes. while individual countries have differences, a common specific they all share is the economic and political benefits from the process. the convergence process is difficult and full of challenges, most importantly, the risk of falling into a ‘ middle income trap ’, a feature that is especially relevant given the slowdown in the speed of convergence that the region experienced in the aftermath of the crisis. the main reasons that can entrap an economy in a middle - income level are a low level of innovation, poor quality of institutions and unfavourable demographics. from a certain point of view, the ability of any country to move up the development ladder depends on the upgrade of its internal economic system, from an efficiency - driven into an innovation - driven economy. obviously, upgrading the whole economic systems and adopting best practices is easier said than done. diminishing marginal returns on labour and capital, as well as a reduced scope for total factor productivity growth, coming mainly from imported technologies, decelerate growth and increase the risks of getting stuck in a ‘ middle income trap ’. therefore, progression to the next development stage requires improvement of the human capital stock, facilitation and innovation in production processes, advancement of domestically generated technology and expansion of high value added exports. in a nutshell, the see countries need to transform themselves into innovation - driven economies