Benoît Cœuré: The known unknowns of central clearing Speech by Mr Benoît Cœuré, Member of the Executive Board of the European Central Bank, at the meeting on global economy and financial system, hosted by the University of Chicago Booth School of Business Initiative on Global Markets, Coral Gables, 29 March 2014. *  *  *  Accompanying slides can be found on the European Central Bank’s website I would like to thank Andreas Schönenberger for his contributions. I remain solely responsible for the opinions contained herein. Ladies and gentlemen, Today, I want to share some thoughts with you on central clearing. [slide 1] At the Pittsburgh Summit in 2009, G20 leaders committed to have all standardised OTC derivatives contracts cleared through central counterparties (CCPs). The mandatory use of central clearing as a regulatory tool for mitigating systemic risk is a fairly new feature in financial market regulation. Central clearing definitely has the capacity to promote financial stability, provided it is appropriately used and any potential side effects are well understood and effectively mitigated. In that context, there are still a number of questions that we need to look at. Let me call them the “known unknowns” of central clearing.
The next stage in the Saudization policy is to increase the proportion of Saudis in the new jobs that are being created by our expanding economy. The government has recently launched a program to support small-and-medium-size enterprises which will also create employment opportunities for Saudis. The forthcoming stage of the Saudiization policy will focus on increasing the share of Saudis in new posts created by economic growth. The Government has recently launched a programme for supporting small and medium size companies, thereby, new jobs will be available for Saudis. There are also a number of challenges in deepening and broadening the financial sector with significant implications for the economy. These include the creation of a viable and vibrant mortgage industry, which would have significant impacts on housing, construction, durable goods and other ancillary sectors. Also, there are initiatives in place to establish sound insurance and leasing industries. These initiatives are also aimed at enlarging the institutional investors' base that can channel resources in developing a pool of expertise, professional skills and technical knowledge in the financial sector. I wish to conclude with the observation that Saudi Arabia's economy is currently undergoing through a stage of accelerated growth in all sectors of the economy at a level and pace unprecedented in the past. The Government is spearheading this dynamic growth with its avowed policy of structural reforms and liberalization in the economy, as evidenced by its success in attracting the private sector and foreign direct investment into primarily the non-oil sectors of the economy.