for all participants, which is necessary to attract private sector investment on a large scale. good governance is also important for the corporate sector, as well as the public sector, not least because companies with good corporate governance are better able to mobilise finance for investment than those whose corporate governance is weak. bis central bankers ’ speeches conclusion to conclude, i would like to emphasise what i think are the key strategic policies needed for sub - saharan africa to sustain growth momentum over the medium to long term. first, policy buffers have to be rebuilt and maintained, to create more fiscal and macroeconomic space to enable governments to implement countercyclical macroeconomic policies in the face of negative macroeconomic shocks. second, if ssa economies are to sustain export led growth and diversify away from overdependence on primary commodities, they must maintain competitive real exchange rates. there is a plethora of empirical evidence to demonstrate how crucial real exchange rates are to sustainable export and economic growth. third, regional integration is crucial for many economies on the continent, especially those which are landlocked. it can provide markets for exports, allow traded goods industries to achieve more optimal economies of scale and strengthen competition in markets, thereby stimulating productivity growth. fourth, as i have just noted, strong institutions for economic governance are an essential foundation for economic development. thank you. bis central bankers ’ speeches

, i agree with antoinette sayeh that a gradual rebuilding of macroeconomic buffers is warranted, which means that it would be preferable to fund higher public investment by making savings in recurrent budgets or by strengthening the domestic tax effort, rather than by resorting to higher levels of borrowing. bis central bankers ’ speeches bis central bankers ’ speeches exchange rate flexibility and inflation as discussed by antionette sayeh in her presentation, exchange rate flexibility provides a crucial tool for facilitating macroeconomic adjustment to external shocks. unless shocks are purely temporary and can be financed, which does not apply to the current shocks facing the continent, some form of adjustment to deteriorating external terms of trade and / or a tightening of access to external finance is unavoidable. this adjustment will be less contractionary for the economy as whole if the real exchange rate depreciates. an argument sometimes advanced to oppose exchange rate flexibility is that nominal depreciation will drive up domestic inflation, imposing hardship on the population and obviating any real depreciation. but the experience of several african countries, with flexible exchange rates and monetary policies which focus on controlling domestic inflation, does not bis central bankers ’ speeches support this pessimism. as shown in the table above, several countries in the region suffered substantial nominal exchange rate depreciations against the us dollar ( albeit less so on a trade weighted basis ) during 2014 and 2015. the table shows the annual depreciation at the end of september 2015, which for most countries was close to the peak of the depreciation in 2015. because the pass through to domestic prices is not instantaneous, we would expect the impact of the depreciation on inflation to be at its maximum several months later. yet at the end of december 2015, annual inflation rates were much lower than the nominal depreciation in four out of the five countries shown in the table, and have remained at a similar level or fallen since then. their central banks were able to keep control of inflation, by tightening monetary policy through raising interest rates or reducing money supply growth, as illustrated on slide 17 of antionette sayeh ’ s presentation. good monetary policy can offset the pass through from the exchange rate to domestic prices. the key is tightening monetary policy in a decisive and timely manner. the lesson i would draw is that a combination of a flexible exchange rate and a monetary policy which targets domestic policy objectives is feasible and probably optimal for macroeconomic management for most countries in the region outside