In the United States and this country, on the other hand, which both grew strongly last year on the back of domestic demand, the emphasis was on a need for vigilance - as always - to stay on a non-inflationary path so that sustainable growth can be maintained. The IMF’s analysis of this country’s position, Mr. Chairman, is in fact very similar to our own. We both recognise that aggregate demand growth needs to moderate quite sharply if inflation is to be held to the Government’s target over the next two years or so. We are already clearly seeing a weakening of net external demand in response to the sterling’s exaggerated appreciation - particularly against other European currencies - since the autumn of 1996 and now in response to the Asian crisis. However undesirable that may be in terms of the balance of the economy - and I am very sensitive to the hammering being taken by the internationally exposed sectors - it does provide a little more time to bring about the necessary moderation of the strength of domestic demand growth, which we expect to occur as a result of both the fiscal and monetary tightening already in place, and in the absence this year of “windfalls” from demutualisations. The critical judgement relates to the precise timing and pace of this moderation of domestic demand growth, and whether it will be sufficient to prevent a pick up in inflation as the dampening effects of the strong exchange rate and weaker external demand wear off.
Caleb M Fundanga: International financial reporting standards for banks and other financial institutions Speech by Dr Caleb M Fundanga, Governor of the Bank of Zambia, at the official opening of a workshop on “International financial reporting standards for banks and other financial institutions”, organised by the Bank of Zambia in conjunction with the Zambia Institute of Chartered Accountants, Lusaka, 17 February 2005. * •  The Chief Executive, ZICA  •  Distinguished Resource Persons  •  Distinguished Participants  •  Ladies and Gentlemen,  *  *  I wish to welcome you all to this important workshop on International Financial Reporting Standards (IFRSs) and International Auditing Standards, (ISAs) organised for finance officers and auditors from commercial banks, non-bank financial institutions and the Bank of Zambia. This workshop is organised by the Bank of Zambia in conjunction with the Zambia Institute for Chartered Accountants (ZICAs) out of the recognition that the International Financial Reporting Standards (IFRSs) and International Auditing Standards (ISAs) are critical not only to the integrity of our financial system, but also to the Bank of Zambia’s efforts of ensuring effective supervision and regulation of banks and non-bank financial institutions. As you may be aware, three important factors have heightened the relevance of accounting and auditing standards to bank supervisors. These, include: •  First, IFRS and ISAs are a set of high-quality, transparent and globally renowned accounting and auditing standards that the Financial Stability Forum (FSF) has included in its 12 Key Standards for Sound Financial Systems.