While it would be ideal to have much broader coverage at this time (as at today, around one-third of global banking assets are officially subject to the Basel III requirements), the delays should not be interpreted as any lack of commitment by global regulators to implement the agreed reforms. At recent international gatherings, all members have been asked to reaffirm their commitment to implementing the agreed reforms as soon as possible. And they have given that commitment (subject, of course, to the vagaries of domestic rule-making processes that each must follow). Nevertheless, let me be clear: the question being discussed is when the reforms will be implemented, not if. Any setback to implementation is undesirable, since Basel III is a key platform on which to rebuild a stronger global banking system. But the delays are not critical at this point, for two reasons. First, the Basel III capital rules contain a lengthy phase-in period, meaning that in 2013 the new requirements should not be particularly burdensome for banks (eg none of the new deductions from capital are applied this year). Second, many regulators who have been unable to implement the new standards by the beginning of this year are still measuring and monitoring their banks’ capacity to meet the new requirements. And, of course, markets are applying similar pressure. In other words, the “force” of the new capital regime is much broader than just those countries that have implemented their domestic regulations.
Unlike other countries, where credits extended to the private sector reduced in certain periods after the crisis, in Macedonia credit flows were constantly growing and currently credits are 1.5 times higher than before the crisis. The average credit growth from 2008 to 2014 was almost 6% which is well above the average for the region of about 1.8%, and certainly above the average for the Euro-zone, where lending decreases. Credit growth accelerated particularly in 2014, and in November this year it was close to 10% on an annual basis. The fact that the banking system is in excellent condition, with a capitalization rate of over 16%, with high liquidity and low reliance on external funding sources, explains the current room for lending. We expect the solid credit support to continue in the medium term, supporting growth. What are our expectations for the economic growth in the period ahead? Although foreign demand suffers downward adjustments, our estimates for the growth of the domestic economy in the next period point to solid performances. Considering the solid economic growth that is already certain to take place in 2014, and the assessments for further support of the growth through foreign and public investment, our estimates point to an economic  2  BIS central bankers’ speeches  growth of 4.1% in 2015 and its acceleration to 4.5% in 2016.