As you are aware, in view of the deterioration in the BOP and to support the government’s reform agenda, Sri Lanka obtained a three-year Extended Fund Facility (EFF) from the IMF, in 2015, and we have already received five tranches of this Facility. Although the developments over the past weeks have delayed the progress that Sri Lanka has been making under the IMF Programme, we hope to keep the IMF Programme on track this year. While this will 20  categorically support the country’s external sector, the reforms would also help boost investor confidence and productivity of the economy. These are key drivers in enhancing growth of the economy. As inflation targeting involves managing and anchoring inflation expectations effectively, transparency of monetary policy, particularly in terms of plans, objectives and decisions, is of utmost importance. Hence, as transparency is achieved through effective communication, as a prospective inflation targeter, the Central Bank is very conscious of the need for a well devised communication strategy. Accordingly, a number of initiatives have already been taken by us to enhance the communication strategy. We have enhanced the analytical value of the regular monetary policy press releases with the support of the IMF, while maintaining clarity, simplicity and enhancing the forward looking approach. In addition, we have initiated programmes on educating, particularly journalists and other stakeholders, regarding FIT.
First of all, by creating a direct relationship between our profits and the funding of an important element in our system of social security, the initiative would establish a dangerous link, since it would certainly place the SNB under constant pressure to distribute more profits in the future. Higher profit distribution would only be possible if we took bigger investment risks or if we reduced our monetary reserves. Markets would start to ask themselves whether the SNB's goal was to ensure the monetary stability of the country or to generate profits. As I pointed out before, there is a risk that constant debate on this topic could sap market perception of our independence. This would damage our credibility and hamper our monetary policy. At the end of the day, implementation of this initiative would undermine confidence in the Swiss franc. Second, the initiative assumes that our profit distribution can be held permanently at a level above CHF 1 billion a year. This is an illusion. The only possible outcome is bitter disappointment on the part of our fellow Swiss. All our calculations show that, as confirmed in the remarks made by the President of the Bank Council on the results for 2005, the SNB's medium-term profit distribution potential amounts to only CHF 1 billion a year. If we deduct the gains due to the spectacular increase in the price of gold and to exchange rate gains from the CHF 12 billion profit recorded for 2005, the distributable profit falls to CHF 2 billion.