deal with their problems. some of the initial uncertainties involved in setting up and getting these imf adjustment programs going have been resolved. and there are now some encouraging signs of improved confidence and financial stability in the region. among the industrial countries, japan is the one most affected by the spillover effects from its asian trading partners. not only are its trade links with them important, but this external shock comes at a time when the japanese domestic economy is much less buoyant than was anticipated earlier. substantial loan exposure by japanese banks to the asian region has also weakened an already ailing financial sector in that country. but it is important to note that japan has the financial wherewithal to deal with its banking difficulties and that a series of measures to combat these problems and to strengthen the economic recovery have already been taken. additional financial sector and fiscal measures were announced recently. at this stage, the situation in asia is still evolving, and, while prospects have improved, we cannot be sure just how quickly and effectively the south - east asian, korean, and japanese economies will respond to the adjustment measures that have been taken. what about the potential effects of all this on canada? since our trade with asia, including japan, makes up less than 10 per cent of our total exports, the direct effects will be relatively modest. but we must also take into account the indirect effects that work through our other major trading partners and through the prices of some of the products we sell abroad. indeed, the implications of the asian crisis for global economic growth and for primary commodity prices on world markets will probably have a more important impact on canada than the reduction of our exports to asia. the fallout from asia will no doubt have a dampening effect on canadian output growth for the current year. but there are also other, more positive, developments that could well work to mitigate this effect. as i said before, economic performance in our major trading partners in the west, particularly the united states, has been somewhat stronger than anticipated. and even though our short - term interest rates have risen, canadian longer - term rates have been falling, along with their counterparts in the united states and europe, reflecting declining inflation and lower inflation - risk premiums. these longer - term rates are an important element in both business investment decisions and household spending on consumer durables and housing. the bank continues to monitor the situation carefully and to appraise the overall effect of these positive and negative influences on our economy. it is clear, however

ardian fullani : development of the interbank market in albania and the bank of albania speech by mr ardian fullani, governor of the bank of albania, at the forum “ interbank market development and improvement of operational policy at the bank of albania ”, tirana, 21 june 2010. * * * dear bank managers, dear colleagues, we are gathered here today to discuss an essential issue concerning the performance of our financial market and the albanian economy on the whole : interbank market development and strengthening. i do believe that the role and importance of the interbank market is clear to all attendees. it represents the first link of liquidity trading in economy and the most transparent price setting mechanism. by providing the appropriate instruments and partners for liquidity trading, the interbank market allows the refinancing of short and medium - term positions and facilitates the mitigation of your business ’ liquidity risk. the banking system and the interbank market represent the exclusive setting monetary policy operates in. a developed, active and efficient interbank market enhances the efficiency of central bank ’ s monetary policy, transmitting its impulses into the economy best. thus, the development of the interbank market smoothes the progress of financial intermediation and boosts lending to economy, hence improving the country ’ s economic and social welfare. the deepening and broadening of the financial market is one of the key structural reforms in economy. it should be ceaseless and it requires the commitment of domestic and external factors. it naturally adapts to the different economic development stages the country and the state go through. i do believe there cannot be a developed and well - integrated economy without open, integrated, efficient, transparent and well - regulated markets. therefore, it comes out clearly that the development of the interbank market is in all stakeholders ’ interests : the banking system itself, the bank of albania and the economy on the whole. being fully aware of this, the bank of albania has built a clear strategy in terms of : 1. deepening and broadening the money market in albania further ; 2. creating relevant market instruments ; 3. establishing a close and rational cooperation with the banking system and the financial market in general ; 4. ensuring a clear and constant communication with the market operators and the public at large ; 5. providing modern technological solution. as a result of these initiatives, our monetary policy is now entirely based on indirect instruments of monetary management, which operate in line with the open market logic. our operational