While I commend the significant development of the SEG forum in the 19 years since its inception, I know we can do so much more to leverage on the experience of each member country here. There is definitely a role for SEACEN that goes beyond equipping member countries with the necessary skills to manage capital flows. For instance, SEACEN can provide thought leadership on the need for small open economies to have a broad policy toolkit in preserving monetary and financial stability in the face of volatile capital flows. SEACEN can take a leading role in intellectually challenging the prevailing view that capital flow measures should only be considered as a last resort. There is no monopoly on good policies and Asia has plenty to offer. SEACEN can lead the way. On this note, I look forward to an engaging and fruitful discussion among members in our sessions today. I believe the forum will be thought provoking, with important learning points that 2/3  BIS central bankers' speeches  will help us better weather the new waves of challenges ahead. Thank you. 1 Terms of Reference of the SEG. 2 Jon Kabat-Zinn (1994), Wherever You Go, There You Are. New York: Hyperion. 3/3  BIS central bankers' speeches
The recession was indeed deep, as Iceland lost just over 11% of output during the recession that ended in Q1/2010 and unemployment peaked at 8% in Q4/2010. The shift in the composition of demand was even more dramatic, as is witnessed by the swing in the current account from a deficit 17% of GDP in 2008 to a surplus of 8% in 2009. To a significant degree, this was induced by a drop in the real exchange rate amounting to 44% from the pre-crisis peak to the November 2008 trough. BIS central bankers’ speeches  3  The recovery began as previous imbalances were corrected and the economy found its bottom in the underlying strength of its traditional export sectors, the non-traded goods sector took advantage of the low real exchange rate, and the stabilisation of the economy and later real wage gains rekindled consumption. And then we have had the phenomenal growth in tourism in the recent years, which seems to be due to much more than the historically low real exchange rate. These figures show developments in GDP and employment during the recession and subsequent recovery in Iceland, with predictions extending into 2017 for GDP and 2016 for employment. For comparison, it shows the median and the 1st-3rd quartiles of the distribution of these variables for 30 other European countries, with Ireland and the UK highlighted. It shows that Iceland’s recession was significantly deeper than the median in Europe, and the same goes for Ireland, although to a lesser degree.