barry whiteside : bank south pacific group expansion in fiji opening address by mr barry whiteside, governor of the reserve bank of fiji, on the occasion of the rebranding of dominion house to bsp life centre, the opening of the bsp life ’ s customer service centre, and the opening of the bsp ’ s thomson street branch, suva, 4 october 2012. * * * his excellency, the president, rau epeli nailatikau the first lady, adi koila nailatikau mr kevin mccarthy, bsp fiji country manager mr malakai naiyaga, managing director, bsp life limited board members of bsp life limited and bank south pacific management and staff distinguished guests ladies and gentlemen introductory comments bula vinaka and a very good evening to you all. i wish to thank kevin and malakai for their kind invitation to yet another significant event in the relatively short history of bsp ’ s operations in fiji. it is indeed a privilege to be here to support your development initiatives and i welcome your ongoing rebranding & refurbishment programme in fiji. it definitely is another sign of the bsp group wishing to further stamp its mark as a major player in the market and is a real vote of confidence for fiji ’ s economy and our domestic financial system. the bsp fiji group we are actually here today to celebrate three different milestones : ( i ) the re - branding of this dominion house complex to bsp life centre ; ( ii ) the opening of bsp life ’ s customer service centre ; and ( iii ) the renaming of the refurbished bank operations to bsp thomson street branch. the bsp fiji arm of the group has an impressive pedigree. it is a union of two prominent fijian financial institutions, colonial fiji life limited and colonial national bank, which were acquired by bsp in december 2009. colonial fiji life limited, which used to be known as colonial mutual life assurance society ( or more simply as just cmla to us older folk ), was founded in melbourne in 1873, and almost simultaneously opened offices in several other centers in australia. a branch office was opened in fiji in 1876 and i understand that this was the first overseas branch of colonial mutual, before the company opened up in new zealand and south africa in 1883, and expanded into great britain and ireland in 1886. the company officially demutualised in 1996 after acquiring blue shield ( pacific ) limited in 1991. the colonial business was domesticated in

to gain an enhanced significance in this area – and i repeat it has every potential to do so – it will be largely at the cost of the ( us ) dollar. of course, the dollar will remain the most important international reserve currency for any foreseeable time. but the euro has the opportunity of winning a greater share in the reserve portfolios of central banks around the world. v. during the first half of 1999 the euro depreciated steadily against the dollar. the decline in the bilateral exchange rate accounted for about 10. 8 % between january and july 1999 ( based on monthly averages ). in the meantime the euro has, partly, recovered from these previous losses. the public debate about this depreciation, in my view, was sometimes ill - informed and mostly superficial. a central bank must primarily pursue internal price - stability. that doesn ’ t mean that it should be indifferent to large fluctuations in the external value of its currency. however, in the case of the euro it is essential to declare an unambiguous commitment to a strong currency policy, be it internally or externally. in this respect there was no lack of clarity on the part of the ecb. however, some european governments did, at least temporarily, create the impression that they had a preference for a low external value of the euro, believing this would stimulate economic activity at a moment when growth looked feeble and vulnerable with respect to the international financial crises around the end of last year. in the meantime, most european governments have become more sensitive in their public statements with respect to the external value of the euro. awareness has grown, as one finance minister recently put it, that “ we are all sitting in one boat ”. a lot has been said and written about the underlying factors that may have caused the euro ’ s initial depreciation, which should not be over - dramatised. often cited were the cyclical divergences between the european and the us economies, with a continuing boom over there and a temporary weakening of activity here. sometimes, part of the weakening of the euro was attributed to the crisis in kosovo. although cyclical and political factors are important, the external value of the euro should, in a long - term perspective, be viewed as a general judgement of the markets on the attractiveness of investment in the euro area. thus, markets assess very carefully, on a continuous basis, the internal economic and fiscal policies of the member countries of the euro, especially of the