Three decisions of the Central Bank of Chile to intervene the foreign exchange market during this decade can be interpreted as decisions under extreme circumstances. They were associated to severe stress in foreign exchange markets or to the need to strengthen the international liquidity position. To avoid conflicts with price stability, the intervention that was begun in April has been implemented mechanically and transparently in order to orient monetary policy in consistency with the required convergence of inflation to the target. It is hard to find a financial crisis as severe as this one since the Great Depression. Still, its real consequences are still much milder than those of other episodes, including of course the Great Depression and even the Great Inflation of the 1970s. We have learned two lessons from these occurrences and which are clearly present in the acts and statements from central bankers around the world. One is that central banks are the lenders of last resort and must supply the necessary liquidity so that financial markets can operate, even in critical times. The other is that inflation must be fought with determination and letting it settle down and stay in the economy is very costly. Different perceptions and assessments can alter the short-term course of monetary policy, so flexibility and realism are necessary to timely correct the route, and this has been happening around the world and in Chile in particular.
I therefore wish to thank, from the outset, Celpay for organising this timely conference and to welcome most warmly our foreign participants who I’m sure will bring a rare insight to this conference with their own experiences. It is widely acknowledged that expanding access to financial services for Zambia’s unbanked population remains one of the biggest challenges confronting the financial sector in this country. Findings from the last FinScope Zambia Survey which was conducted in 2009 showed that 62.7% of Zambian adults still remained financially excluded compared to 66.3% reported in 2005. This slight increase in access to financial services, however, fails to match the significant increase in the number of banking and non-banking institutions which over the same period increased from 14 to the current 19 banks and to over 90 in the case of the nonbank sector. The mismatch in growth between the supply side and the demand tells us a story that the physical increase in the number of the traditional financial service providers does not necessarily translate into a corresponding increase in access to financial services among the population. I believe it is this mismatch that calls for the need to examine the role that the non traditional platforms, such the mobile phones, can play in enhancing greater access to financial services.