SAARCFINANCE COORDINATORS CONFERENCE: ISSUES AND DECISIONS

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SAARCFINANCE CO-ORDINATORS CONFERENCEISSUES
AND DECISIONS

• A Presentation By
• AYUB UL HASAN
• Economist
• Economic Policy Department

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SAARCFINANCEA BIRDS EYE VIEW

• Decision regarding setting up SAARCFINANCE was
  taken at the Tenth Summit of Heads of State of
  the region, held in Colombo, Sri Lanka, on 29th
  July 1998.
• The Inaugural Meeting of the Network took place
  at Washington, D.C. on 5th October 1998.

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SAARCFINANCE WHAT IS IT ALL ABOUT

• SAARCFINANCE  is a permanent body at the level of
  Governors of Central Banks and Secretaries of
  Finance of SAARC Member States.
• The primary function of the Network is to conduct
  a dialogue on macro-economic policies of the
  region and share experiences and ideas.
• It is expected to make recommendations, which
  would be of practical benefit to the region.
• Closer co-operation among the Central Banks and
  Finance Ministries is expected to be mutually
  beneficial.

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SAARCFINANCE MANDATE AND FUNCTIONS

• Originally, the following specific matters were
  to be considered by the Network
• Global developments and their impact on the
  region
• Reforms for the international financial and
  monetary system and the evolution of a consensus
  of the position of SAARC countries.
• Surveillance of international currency and
  capital flows and the evolution of a common SAARC
  position.
• The impact of the Euro on South Asia.
• Improvement of the Asian Clearing Union to enable
  countries to settle payments without recourse to
  the US Dollar.

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SAARCFINANCE MANDATE AND FUNCTIONS Contd.

• Subsequently, the Networks scope was widened to
  include, among others, the following
• To promote cooperation among Central Banks and
  Finance Ministries in SAARC Member Countries by
  staff visits and regular exchange of
  information. 
• To consider and propose harmonization of banking
  legislations and practices within the region,
  etc.
• To work towards a more efficient payment
  mechanism within the SAARC Region and strive for
  higher monetary and exchange cooperation. 
• To forge closer cooperation on macro-economic
  policies of SAARC Member States and to share
  experiences and ideas.
• To study global financial developments and their
  impact on the region including discussions
  relating to emerging issues in the financial
  architecture, IMF and World Bank and other
  international lending agencies.

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SAARCFINANCE MANDATE AND FUNCTIONS Contd.

• To monitor reforms of the international financial
  and monetary system and to evolve a consensus
  among SAARC countries in respect of the reforms.
• To monitor international currency and capital
  flows and to work towards a common SAARC
  position.
• To evolve wherever feasible joint strategies,
  plan and common approaches in international fora
  for mutual benefit particularly in the context of
  liberalization of financial services.
• To undertake training of staff of the Ministries
  of Finance, Central Banks and other financial
  institutions of the SAARC member countries in
  subjects relating to economics and finance.

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SAARCFINANCE ADMINISTRATIVE ARRANGEMENTS

• The Secretariat of the Network is established in
  the Central Bank of the country that holds the
  Chairpersonship of SAARC Organization.
• The Secretariat moves in rotation with the change
  in the SAARC Chair.
• Each Central Bank has established a Cell to
  coordinate the activities of SAARCFINANCE.

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CHAIRMANSHIP COORDINATORS
Governor of the Central Bank, holding the
Networks Secretariat, serves as the Chairperson
of SAARCFINANCE. Each member country has a
SAARCFINANCE Co-ordinator to serve as a focal
point of the Country towards Networks affairs.
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SAARCFINANCE MEETINGS

• Regular Meetings of the SAARCFINANCE Network are
  held at least twice a year at the time of the
  Spring and Annual Meetings of the IMF and the
  World Bank.
• Coordinators Meeting takes place once in a year,
  generally one month before the Annual Meeting of
  BWIs, in the country holding the Networks
  Secretariat.

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SAARCFINANCE ACTIVITIES

• Information Sharing
• Studies/Seminars
• Staff Exchange Program

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STAFF EXCHANGE PROGRAM

• Since inception of the Network, 135 officers
  visited various institutions of member countries
  under SAARCFINANCE Staff Exchange Program. The
  matters of the Staff Exchange covered a broad
  range of issues, ranging from risk-based
  supervision to human resource management and
  forward marketing arrangements for agricultural
  produce, etc.

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4TH SAARCFINANCE COORDINATORS MEETING HELD IN
ISLAMABAD, PAKISTAN

• 23RD SEPTEMBER, 2004

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AGENDA FOR THE MEETING

• Presentation of SAARCFINANCE Progress Report
• Enhancing effectiveness of Staff Exchange Program
  
• Issues relating to formation of South Asian
  Development Bank (SADB) and South Asian Economic
  Union (SAEU)
• Preparation of Next years programme of
  trainings, seminars and research activities, to
  be conducted under SAARCFINANCE.
• Finalizing agenda for the meeting of SAARCFINANCE
  Network, scheduled for 4th October 2004 at
  Washington D.C, USA.
• Others

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THE MEETINGS DECISIONS

• Information Sharing
• So far, the process is demand-driven needs
  enhancement.
• List of material to be distributed by each
  Coordinator then others to  request for the
  requisite material.
• Each member Central Bank to create a SAARCFINANCE
  link at their websites, containing SAARC-related
  and other macro-economic information.
• A copy of all the information sharing should be
  passed on to the Chair Coordinators for record.

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THE MEETINGS DECISIONS Contd.

• Staff Exchange Program
• Discussion took place with respect to the
  effectiveness of staff exchange programs.
• There was a concern that Pakistan and India, two
  major countries, could not send their staff to
  other member countries to have hands-on
  experience.
• The following table presents details about the
  program.

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STAFF EXCHANGE PROGRAM

• Country RBI CBSL SBP NRB BB Total
• Bangladesh 6 - 4 - - 10
• Bhutan 31 5 - 3 - 39
• India - 1 - - 1 2
• Maldives 2 2 - - - 4
• Nepal 5 15 3 - 4 27
• Sri Lanka 46 - 4 2 1 53
• Total 90 23 11 5 6 135

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THE MEETINGS DECISIONS Contd.

• Staff Exchange Program
• There is a need to have more staff exchange
  programs primarily between India and Pakistan .
• Scale of staff exchange programs would be
  enhanced. In particular, SBP and RBI would
  arrange attachment programs for Senior Officers
  from India and Pakistan, respectively. .
• Senior Officers should visit the other Central
  Banks to explore areas of relatively advanced
  development for possible staff exchange programs
  .

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THE MEETINGS DECISIONS Contd.

• Seminars and Studies
• It was noted with concern that so far only one
  Seminar was held under the banner of SAARCFINANCE
  during 2004.
• It was emphasized with consensus to organize
  Seminars frequently particularly in leading SAARC
  countries .
• Pakistan would hold a Seminar before the close of
  2004 or early 2005.
• RBI would hold 1-2 Seminar(s) in 2005. CBSL also
  to hold a Seminar next year.

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THE MEETINGS DECISIONS Contd.

• Formation of SADB
• SAARCFINANCE was asked by the SAARC Council of
  Ministers to look into the issues of formation of
  SADB and SAEU.
• State Bank of Pakistan initiated the process of
  hiring a Consultant from World Bank to carry out
  the feasibility of setting-up SADB.
• Coordinators were requested to brief their
  Governors about the feasibility of setting-up the
  SADB which was to be discussed during 11th
  meeting of the Network

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THE MEETINGS DECISIONS Contd.

• Formation of SAEU
• It was felt that realization of the goal
  appeared to be somewhat immature, at this point
  in time. It was, therefore, decided to undertake
  further studies on the subject so as to move
  towards the eventual realization of the SAEU in
  future.

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THE MEETINGS DECISIONS Contd.

• Other Issues
• The SAARCFINANCE Chair would be formally handed
  over to Bangladesh (subject to holding of SAARC
  Summit in January 2005) during 12th meeting of
  the Network .
• India and Bangladesh were still without
  Coordinators at the Ministry of Finance. It was
  decided that it was up to the country in question
  to decide as to the need to have a Coordinator at
  the Ministry of Finance.

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AGENDA FOR 11TH MEETING OF SAARCFINANCE GROUP

• Scaling up of information sharing among SAARC
  countries
• Scaling up of SAARCFINANCE Staff Exchange Program
• Review and discussion on training programs and
  seminars to be organized in 2004-05 under
  SAARCFINANCE
• Issues relating to formation of South Asian
  Development Bank (SADB) and South Asian Economic
  Union (SAEU)
• Others

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SAARCFINANCE PERFORMANCE HIGHLIGHTS

• Useful dialogue on the regional issues among
  Central Bank Governors and Finance Secretaries
  during regular meetings of the Network
• Meetings/workshops/seminars have taken place in
  various member countries on issues of topical
  interest
• Considerable exchange of information/publications
  have been made among member countries
• A number of studies have been completed
• Exchange of visits by officials under
  SAARCFINANCE Staff Exchange Programme.

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SAARCFINANCE END NOTE

• SAARCFINANCE may be considered as an important
  development towards regional cooperation
• Since its inception, the Network has shown
  progress towards achievement of goals for which
  it was established, thereby making its presence
  felt at the international organizations/fora
• It is supposed to play a more important role in
  enhancing collaboration among the member
  economies in future.

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ITS ALLFROM MY SIDEBUT THE STORY CONTINUES