Institutions are admittedly not accustomed to drawing attention to their forecasts if they do not come completely true. But what are the explanations? It has transpired now that GDP grew last year by more than was forecast, and new national accounts data also show that the figure for 2004 was hugely underestimated. GDP growth then was 8.2%, the highest figure in Iceland since 1987, which was effectively a tax-free year [when Iceland moved onto a PAYE tax system]. Last year was eventful on the economic front. Private consumption grew at its fastest rate since 1987 and gross fixed capital formation faster than any year since 1971. Import growth has not been as brisk in any year since 1953 and the current account deficit broke previous records – although it should be added that as a result of income from soaring foreign asset holdings, Iceland’s net external position only deteriorated slightly. Real wages were at a peak, unemployment at a minimum and direct foreign inward investment ran at a massive level. This inflated picture must be seen in the light of the very robust economic growth in the previous year, 2004, and strong growth in 2003 as well. Besides these large movements, a structural change in the domestic credit market made much more capital available to mortgage borrowers. Higher disposable income and net wealth also contributed to making this a unique period in Icelandic economic history.
In the United Kingdom for instance, there is a Financial Inclusion Taskforce which is an independent body appointed to advise Her Majesty’s Treasury and to monitor and evaluate progress on its financial inclusion as well as oversee a 120 Million Pounds Financial inclusion Fund. A platform for collaboration between local governments and the financial institutions in the UK has been established in order to ensure that everyone has access to financial services and that such inclusion corresponds with the needs of local economic development. In other parts of Europe, the offer of basic banking accounts typically lies at the heart of many countries' efforts to increase financial inclusion and they are a common feature of economic policy in Europe. In Asia, this matter has also been dealt with in various ways. In India, the Reserve Bank of India issued guidelines (in 2006) by which banks are encouraged to enhance the level of financial inclusion in their areas of operation in a time-bound manner. In Malaysia, a Financial Sector Blueprint (2001-2010) has been used to guide interventions in the financial sector. However, financial inclusion is not an end in itself. Having a bank account, or an insurance coverage, does not mean an enhancement in the economic position or well being of a person. But it acts as a facilitator. In Zambia, following the launch in 2004 of the Financial Sector Development Plan (FSDP), a lot of work has been undertaken in addressing the weaknesses in the Zambian financial sector, including the level of financial access.