Two of these do not concern me today. They are, first, the provision of intra-day liquidity under the RTGS system and overnight liquidity through the Discount Window, the main objective of which is to ensure the smooth 3  BIS Review 77/1999  functioning of the interbank payment system on a day-to-day, short-term basis; and, secondly, and at the other extreme, longer-term liquidity support or capital support to a probably insolvent bank, the failure of which would have wider implications for the stability of the monetary and financial systems of Hong Kong. The role of lender of last resort which I am addressing today is neither of those, but comes somewhere between the two. It involves the provision of support to banks that are basically solvent but are troubled by short-term funding difficulties. The immediate purpose of such support is to provide some breathing space to allow the institution to implement corrective measures. The overall aims would be, first, to prevent illiquidity in that particular institution from precipitating a situation of insolvency and, secondly, to prevent the contagion to other banks and hence a crisis for the system as a whole. The Legal Framework This crucial consideration, the effect on the system as a whole, brings me to the question of the resources available to the HKMA, and the legal and other limitations placed on the HKMA, in the exercise of its role as lender of last support.
This development, which has been under way for several decades already, has accelerated as a result of the impact of the crisis on births and migratory flows. People over the age of 65, who in 1970 made up less than 10% of the population, currently account for 21% and, according to INE projections, will represent more than a quarter of the Spanish population within 15 years. Currently, two types of adverse effects of this phenomenon on economic growth can be identified. First, population ageing is leading to a reduction in the number of persons prepared to work or seek employment. Second, indirect negative effects of population ageing on productivity, saving and investment decisions and innovation can be identified. As a result, ageing poses enormous challenges for fiscal policy, since a smaller labour force, that is possibly on average less productive, will have to support the vital needs of a growing number of dependent persons. In fact, the scope and consequences of population ageing form the backdrop to the other long-term challenges facing the Spanish economy. Towards a greater use of the labour factor The formulas to combat the effects of demographic developments involve the search for means to achieve a greater use of the labour factor and higher productivity growth. Despite the recovery, employment still stands below its pre-crisis level. The unemployment rate in the first quarter of 2017 was 18.8%, far higher than in the other euro area countries, 5/8  with the exception of Greece.