Benefits of foreign direct investment are manifold ranging from efficiency gains brought about by new technologies to the introduction of innovative products and management techniques. Further, more advanced research and development facilities and adoption of best practices from more matured financial markets will contribute to the transfer of skills and knowledge, adoption of sound risk management culture, technology and ideas in the domestic financial system. Another consideration in the liberalisation process is that of promoting financial inclusion, where all segments of society will have access to adequate financial services. The wide branch network of domestic banking institutions has ensured that non-urban areas have access to banking services, thereby eliminating the use of informal financial services. Domestic banking institutions with large presence in the non-urban areas, some as high as 20% of total branches, have succeeded in achieving sustainable performance while meeting this objective. Locally incorporated foreign banks are however located mainly in major cities and serve only certain segments of the banking public. A wider dispersion of branches of locally-incorporated foreign banks across the country would contribute towards achieving greater financial inclusion. For further expansion outside major cities to be a commercially viable proposition, it is recognised that the attainment of critical mass is essential. In this  6  BIS Review 55/2006  regard, in addition to the flexibility accorded to establish up to four new branches, consideration will be given to allow for greater presence in the non-urban areas and to serve the segments of the economy which are currently underserved.
In order to successfully maintain price stability, we constantly have to make all the reasons underlying our decisions transparent to the public. 1  2  Source: http://www.ecb.int/stats/payments/payments/html/04_table2.en.html  BIS Review 59/2004  The announcement of the monetary policy strategy in October 1998, before the introduction of the euro, was a milestone in this regard. It clearly stated the ECB's understanding of its objective and the framework used to guide policy decisions. In addition, the Governing Council's assessment of the economic situation and the risks to price stability are regularly published and monetary policy decisions are explained in a press conference that I and the Vice President give immediately after each monthly meeting in which monetary policy is discussed ; in this respect, the ECB has been very bold in its communication policy, as the usual practice of central banks in 1999 was to release their diagnosis about 6 to 8 weeks after the meeting of their decision making body; by providing a comprehensive explanation of its decisions almost in real time, the ECB has certainly set new standards of transparency in the world of central banking. We are convinced that transparency is a prerequisite for accountability and enhances the understanding among the markets of how the central bank conducts its monetary policy, thereby promoting predictability and supporting substantially policy effectiveness.