sterilise the monetary impact of these reforms, and support the central bank ’ s target for inflation. the issuance of cds, together with the partial liberalisation of credit allocation, are all sensible and commendable steps. and i know that the central bank is actively considering additional possibilities. these measures will make for a financial system in iran that is more efficient, liquid and transparent - and thereby more attractive to potential market entrants. mr chairman, economic progress in any one country is not just a question of that country ’ s national interest, it is - in today ’ s increasingly economically and financially integrated world - a matter of collective, international interest. that is true both at the macro - and at the microeconomic level - the level of individual businesses and firms. that ’ s why i think it is important that we encourage the forces working for reform and liberalisation by engaging constructively with them. iran has embarked upon an ambitious, but realistically measured, programme of reform and liberalisation through the third five - year development plan, and it is taking advantage of the present more favourable conditions in the world economy to advance that programme. i wish you, governor nourbakhsh, and the authorities in iran all possible success in achieving your objectives in the interests of the iranian people and in the interest of us all.

economic growth, and its independence. for the remainder of the 1990s, in contrast to the previous two decades, the sarb ’ s policy of positive real interest rates brought inflation sustainably within single - digit territory. in 2000, the introduction of inflation targeting helped to clarify the mandate of the sarb, providing a policy anchor and introducing greater transparency in policy decisions. this policy has brought clear results. since inflation targeting began, annual consumer price inflation has averaged 5. 7 % ( and 5. 3 % so far in the present decade ), compared to 10 % in the 1990s and as high as 15 % in the 1980s. as the inflation - targeting regime has gradually grown in credibility, south african inflation has also become less volatile. the standard deviation of monthly year - on - year inflation readings has fallen to 0. 9 percentage points so far in this decade, from 3. 1 percentage points in the 2000s. yet, as i mentioned earlier, south african inflation is still relatively high by global standards : its 2018 average of 4. 6 % placed it around the 80th percentile of a sample of 58 large advanced and emerging economies. page 2 of 9 this brief recap of the recent history of inflation in south africa reminds us of how the level and volatility of inflation can have a crucial impact on the decisions of both real economy and financial investors. the high and volatile inflation in the 1980s and early 1990s, resulting in high - amplitude interest rate cycles, coincided with a large decline in fixed investment as a share of gross domestic product ( gdp ), especially in the private sector. that decline only started reversing in the 2000s, after inflation targeting was adopted. still, investment levels remain insufficient to trigger the kind of sustained acceleration in economic growth that is necessary to meaningfully reduce unemployment and poverty. it is true that low and stable interest rates provide a conducive opportunity for investment, but the issue lies in where these funds are channelled. while other factors contributed to the low investment rates of earlier decades, it is not difficult to understand why high and volatile inflation can cripple capital formation. uncertainty about future nominal returns makes a business more reluctant to commit capital, except for the more profitable projects. at the same time, high inflation discourages domestic savings, thus increasing reliance on foreign investors who are more likely to prove risk - sensitive and demand a premium because of inflation volatility. high uncertainty premiums can, in turn, result in misallocation of capital