The prices of other goods and services, on the other hand, have been posting quite modest growth rates. Therefore, the inflation expectations of entrepreneurs and consumers have remained close to the historical average. If the price hike of commodities stops, the increase in the euro area’s prices could remain below 2% already next year. However, looking at the data from another angle, we can find proof to arguments which insist that the current euro-area interest rate level is not suitable for guaranteeing the low inflation rate that corresponds to the price stability goal. Although the general public focuses on the debt crisis of certain European countries, the developments of the economy itself have, on the whole, exceeded expectations. Economic growth has remained above average and the utilisation of production capacity no longer resembles a crisis situation. Though unemployment is still high, it is decreasing and the indicators of the industrial and service sectors are posting quite high results from the historical perspective. If we add here the fact that global price rise pressures have been annoyingly enduring and do not show any signs of abatement, the risk of a persistently higher inflation rate in the euro area has increased. Therefore, at the press conference after the most recent meeting of the Governing Council of the European Central Bank it was pointed out that, to withstand this threat, the Eurosystem might increase the price of money in the markets earlier than expected, maybe already in April.
However, with the credit reference bureau now operational, to which I believe most of these institutions subscribe and access credit information on their borrowers, it is expected that the levels of delinquencies that the sector used to suffer through the non-repayment of loans by customers would decline. I therefore, implore all microfinance institutions to comply with the Bank of Zambia Directive of December 2008 regarding the use of the credit reference system and submission of credit data. I must emphasise that regulatory action will be taken against defaulting institutions. As I conclude, allow me to further urge microfinance and other financial institutions to continue revising their interest rates and charges in tandem with the movements in key macroeconomic indicators such as inflation. I am conscious to the fact that all microfinance institutions are in business and are therefore expected to make profits. However, making super profits at the expense of the poor and vulnerable is regressive to economic development. There is a need to make financial services more affordable to the majority of our people as well as small enterprises in order to expand their operations, employ more people, and thereby provide an impetus to significantly reduce poverty levels in the country. Let me, once again, extend my gratitude to MicroFinance Transparency and the Association of Microfinance Institutions of Zambia for inviting me to officiate at this launch of the Transparent Pricing Initiative in Zambia. It is now my honour and privilege to declare the workshop on Transparent Pricing officially opened.