Mr. George speaks on the advent of the euro, and its possible impact on Europe and the Mediterranean region Speech by the Governor of the Bank of England, Mr. E.A.J. George, at the FT Euro-Mediterranean Capital Markets Conference in London on 26/3/98. I’m delighted to take part in this conference which has been organised by the British Government during its term of Presidency of the European Union to promote and strengthen financial and economic ties within the partnership between the European Union and its Mediterranean neighbours. It is a very happy accident of fate - to me as a central banker at least - that this country should hold the EU Presidency at this particular time, as Europe prepares to take the definitive step to monetary union. Earlier this week in Frankfurt the Council of the European Monetary Institute finalised its “convergence report”, which we published yesterday, at the same time as the parallel report by the European Commission. The Commission also published its recommendation to EU Finance Ministers and Heads of Government that 11 EU member states should move to monetary union, in a first - tidal - wave, from January 1st next year. Without seeking to anticipate the decision to be taken by the Heads of Government under Prime Minister Tony Blair’s Presidency in Brussels during the first weekend of May, the odds are that monetary union will go ahead on that basis. It is an historic moment.
This is in line with the growth in the activities of the two existing cross border PvP links recorded by us. Since 2010, the combined average daily turnover of the links with Malaysia and Indonesia has doubled, reaching a new record of $ billion last month. This is equivalent to an annual growth of about 23%. Other economies in the region, especially those with significant FX transactions, can similarly be benefited from a reduction in settlement risk and increase in efficiency in the settlement of FX transactions by establishing a PvP link with the USD RTGS system in Hong Kong. 9. The HKMA will continue to watch out for opportunities to collaborate with Asian neighbours to develop infrastructural solutions to meet growing regional demand for more efficient and robust settlement solutions. 10. Lastly, I would like to thank BOT again for the Bank’s commitment and professionalism leading to the successful launch of the PvP link. Based on the solid foundation laid through this project, I keenly look forward to working with BOT in other areas of central bank cooperation to contribute further to regional financial stability and prosperity. 11. Thank you. 2  BIS central bankers’ speeches