of exchange controls the existing exchange controls in the region were analysed by a sub - committee of the governors ’ committee with a view to gradual harmonisation. participating countries are being encouraged to remove remaining exchange controls for transactions within the region as quickly as possible. arrangements were made for the repatriation of banknotes amongst participating countries, and for an easing of private sector investments across borders in the region. three countries, i. e. botswana, mauritius and zambia, have removed all exchange controls and some others are making steady progress in the implementation of this programme. a vision for the future as already mentioned, the sadc organisation is a political association that covers a much wider objective than just financial cooperation within the region. this wider objective, however, has more potential for disputes and friction, and will also at times be constrained by the red - tape of a long drawn - out inter - governmental decision - making process. i believe that the committee of governors of the central banks of sadc provides a unique body that should be able to proceed with a programme of financial cooperation in the region, without being unduly constrained by the more complex political decision - making processes. at this stage, i believe work should continue to proceed on the accepted road of focusing on identified projects that can be developed on a regional basis without full economic integration of the 14 countries now forming part of sadc. most of these programmes will also not require any formal inter - governmental agreements. in the process, we shall provide a basis for gradual but effective cooperation and integration of the financial systems and markets of southern africa. in the longer term, the vision should be : • to make it possible for residents of the whole sadc region to move funds around within the region without formal exchange control restrictions or border controls ; • to make it possible for residents of the region to invest in the shares of companies in every country of the region without restriction, to buy and sell on any one of a series of closely - linked stock exchanges, and to arrange for settlement anywhere in the region ; and • to make it possible for business people to do their business, whatever kind of business it might be, anywhere in the region without any undue financial restriction. to reach these objectives, however, i believe that the central banks of the region should, for the time being, continue to work on an almost informal way to establish a sound basis for the more ambitious plan of eventual full economic integration of the region. the momentum built up over the past

other emerging ( 1 ) global emerging market ( gem ). ( 2 ) middle east, emerging europe and africa. source : emerging portfolio fund research. figure 2 issues in emerging economies ( billions of dollars ) 1t06 4t06 3t07 africa & middle east asia 2t08 1t09 emerging europe 4t09 latin america source : jp morgan. figure 3 bank deposit inflows ( * ) ( billions of dollars ) - 50 - 50 - 100 - 100 - 150 - 150 - 200 - 200 ( * ) change in the external liability position of emerging economies'reporting banks. includes brazil, chile, mexico, panama, taipei ( chinese province ), hong kong, india, malaysia, korean rep., singapore, south africa, turkey. source : bis. figure 4 price - to - earnings ratio in emerging economies ( percentage ) colombia malaysia chile korean rep. mexico singapore brazil source : bloomberg. figure 5 real exchange rates in emerging economies ( index, 2007 - 2010 average = 100 ) chile mexico brazil peru china poland colombia singapore malaysia korean rep. source : bloomberg. figure 6 interest rate differentials ( * ) ( percentage ) - 2 - 2 brazil mexico chile poland colombia malaysia korean rep. ( * ) difference between each economy's reference rate and the us fed funds rate. sources : bloomberg and central bank of chile. figure 7 current account balance ( percentage of gdp ) - 2 - 2 - 4 - 4 - 6 - 6 - 8 - 8 emerging economies emerging asia lac - 7 ( * ) ( * ) simple average for argentina, brazil, chile, colombia, mexico, peru and venezuela. source : weo, april 2010. for 2009 - 2011, estimate and forecast. figure 8 latin america : change in international reserves ( billions of dollars ) - 25 - 25 - 50 - 50 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 ( f ) ( f ) forecast. source : weo april 2010, imf. figure 9 real exchange rate ( index, 1986 = 100 ) reserve requirement period and exchange rate band dollar sale dollar purchase rer source : central bank of chile.