Wednesday, 28 May 2014

Central bankers seeking regional solutions

Operations managers of regional central banks came together recently to try to reduce the challenges being faced regarding the management of debt and foreign reserves.

Delivering brief remarks at the meeting, Governor of the Central Bank of Barbados, Dr. DeLisle Worrell, stated that by sharing information over the three days of talks, solutions could be discovered to the issues being experienced across the region.

Governor of the Central Bank of Barbados,
Dr. DeLisle Worrell, officially opened the meeting.
(Front row, second from left) Governor of the Central Bank of
Barbados, Dr. DeLisle Worrell, poses with visiting Operations
Managers of Regional Central Banks.
“The conference will discuss debt management, another area that presents challenges. The conventional approaches to the management of debt distinguish between the circumstances of advanced countries and emerging market countries, but they do not acknowledge any distinction between large, self-contained countries like Brazil and small countries like ourselves who have to depend on foreign exchange inflows to fuel economic growth. We therefore have to share experiences among ourselves in search of our own guidelines for managing debt, guidelines that make sense in our reality,” he said.

As he opened the meeting, Dr. Worrell highlighted the obstacle presented by foreign reserve management, especially in light of the current international environment of very low interest rates on the liquid securities that central banks hold.

“The conference will discuss the pros and cons of adopting more flexible investment guidelines, in the search for greater yield on foreign reserves,” he stated.

In addition, Worrell pointed out that regional central banks had to re-think how to do things in “the search for greater efficiency within the financial sector and to ensure that finance serves the development needs of our increasingly sophisticated society”.

Speaking on payments in particular, he stated that while technology made it possible to effect payments almost instantaneously from anywhere in the world, issues with security and verification meant that only small cash transactions and transfers could be made.

“The ongoing challenge for payments systems is how to keep the systems safe, while at the same time speeding up the payments process to take advantage of new technology,” he added.

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