, and could be expected to put upward pressure on the us dollar exchange rate. furthermore, us tariffs would invite retaliatory actions by other countries. this would raise prices to consumers, and distort global supply chains as producers 8 / 11 bis central bankers'speeches in the us and elsewhere change sources of supply and product destination. increased protectionist measures would represent a negative global supply shock. recent simulations conducted by the oecd estimate the potential impact of a general 10 percentage point increase in trade costs imposed by the major trading economies – the us, europe, and china. 6 such an increase could have a major impact, especially on the countries introducing these restrictions : their gdp could fall by 2 to 3 percent ; imports by 5 to 10 percent ; and exports by 10 to 15 percent, with the us the worst affected. and the rest of the world would suffer too from falling gdp, imports, and exports. new zealand would not fare well in such circumstances. even if our exports of goods and services to the us — currently over $ 8 billion – were not directly subject to higher tariffs, we would be hard hit by a downturn in the global economy, including among our main trading partners, in response to the direct and indirect impact of protectionist measures. we would experience lower global demand and weaker commodity prices. our exporters would also experience efficiency losses and increased costs if they faced disruptions to established supply chains. we would also experience spillovers as foreign producers ’ diverted trade in response to tariffs and more general trading conditions. world financial conditions would also change as heightened uncertainty and a rise in global risk aversion would likely lead to higher external funding costs even as global growth slows. in such a situation portfolio flows may shift to larger more liquid financial markets and our exchange rate could fall, placing upward pressure on domestic prices and eroding real incomes. ii ) fiscal expansion in the us 9 / 11 bis central bankers'speeches as with the protectionist sentiment, it is too soon to be specific about the nature and size of fiscal stimulus in the us. however, the possibility of a significant us fiscal stimulus represents an upside risk for new zealand. a significant stimulus would boost economic demand in the us and spillover to other countries. new zealand would benefit through higher commodity prices and increased exports to the us and to our other trading partners experiencing higher growth as a result of the us stimulus. modelling within the bank suggests that a fiscal expansion that boosts us gdp by 1 percent

basel framework ; and · information on exposure concentration, exposures to connected parties, asset quality and profitability. the key information summary must be displayed prominently in, and be available on demand from, every bank branch. the general disclosure statement contains wider - ranging and much more detailed information on the bank and its banking group, including : · comprehensive financial statements ; · credit rating information ; · detailed information on capital adequacy, asset quality and various risk exposures ; and · information on the bank's exposure to market risk. one of the most important features of this disclosure framework is the role it accords bank directors. each director is required to sign and make certain attestations in the disclosure statements, including : · whether the bank is complying with the prudential requirements imposed on it by the reserve bank ; · whether the bank has systems in place to adequately monitor and control its banking risks and whether those systems are being properly applied ; · whether the bank's exposure to connected parties is contrary to the interests of the bank ; and · whether the disclosure statement contains all the required disclosures and is not false or misleading. directors face potentially severe criminal penalties and civil liability where a disclosure statement is held to be false or misleading. complementing the disclosure requirements, banks incorporated in new zealand are required to have a minimum of two independent directors ( who must also be independent of any parent company ) and a non - executive chairman. these requirements are intended to increase the board's capacity to scrutinise the performance of the management team. in addition, independent directors provide some assurance that the bank's dealings with its parent or other related parties are not in conflict with the interests of the bank in new zealand. the disclosure requirements have increased the accountability of bank directors and, indirectly, the accountability of various levels of management within the banks. as a result of the disclosure arrangements, we have seen directors taking greater care than might otherwise have been the case to ensure that they are adequately discharging their obligations. in so doing, directors have strong incentives to ensure that there are appropriate accountability mechanisms within the management hierarchy.