May I take this opportunity to commend ZICA for the tremendous progress it has made in the development of the accountancy profession in Zambia. I am aware that the number of qualified accountants in the country has continued to grow with ZICA boasting a total of 3,606 members as at December 2009 compared to 2,938 in the previous year. This is no doubt a testimony to the growing number of institutions that are offering quality accountancy training courses. The growing number of accountants is also a reflection of the economic achievements the country has scored in the recent past. It is worth noting that as the economy continues to post positive economic growth, the country’s need for accountants will also increase. Distinguished Members, allow me at this moment to briefly highlight the performance of the economy in 2009. Although projections of GDP growth for 2009 had been revised downwards to 4.3% on account of the effects of the global financial and economic melt-down, preliminary data indicates that the economy posted a real GDP growth rate of 6.3% compared with the 5.7% recorded in 2008. Almost all key sectors of the economy recorded positive growth except for restaurants and hotels which saw negative growth due to lower tourist and business travel arrivals during the financial crisis. Annual overall inflation slowed down, reverting to single digit level of 9.9% in December 2009 from the 16.6% recorded in December 2008, and was in line with the original end-year target of no more than 10%.
All these elements will ensure that bank managers are conscious of how risk-drivers change through the cycle and in stress conditions, and that they incorporate these elements into their decision-taking processes and capital strategies. Let me move now to the work under way to implement the new framework. I’d like to highlight two areas in this respect. 3. Catalytic role in promoting supervisory co-ordination and convergence  The effective implementation of Basel II will depend to a large extent on the ability of “home supervisors” and “host supervisors” of internationally active banks to co-operate efficiently. Certainly one of the goals for any international framework is to foster a more level playing field for internationally active competitors. The Basel Committee wishes to ensure that competition between internationally active banks is driven by each bank’s individual strengths, rather than by differences in each country’s rules. Basel II is intended to promote a more level playing field for internationally active banks. Yet Basel II cannot and should not be expected to create perfect harmonisation across all jurisdictions. Differences in legal systems, market practices and business environments in each country make it an extremely difficult task - and, indeed, an impossible one - to even out all distinctions across all borders. Our goal should instead be to facilitate the application of minimum standards and to work together, across borders, to promote a more consistent implementation and application of the new framework. This enhanced co-operation is a process that will promote consistency and convergence of supervisory practices.