“Governors’ conferences help us gain strength from each other”

Your Excellency President Mahinda Rajapaksa, President and Minister of Finance of the Democratic Socialist Republic of Sri Lanka Honourable Gitanjana Gunawardena, Deputy Minister of Finance Secretary to His Excellency the President and other senior Government officials Members of the Diplomatic Community, Dr. Chea Chanto, Governor of the National Bank of Cambodia and Chairman of the SEACEN Board of Governors, Distinguished Governors from SEACEN and SAARC,

Heads of Delegations Mr. Naoyuki Shinohara, Deputy Managing Director of the International Monetary Fund, Mr. Jaime Caruana, General Manager of the Bank for International Settlements, Members of the Monetary Board and Officials of the Central Bank of Sri Lanka, distinguished delegates and invitees, I am deeply honoured and privileged to welcome all of you to the Central Bank of Sri Lanka this morning for the Inauguration Ceremony of the 46th SEACEN Governors’ Conference and High-Level Seminar.

At the outset, may I extend a very warm welcome to our Chief Guest, the President and Minister of Finance of Sri Lanka, His Excellency Mahinda Rajapaksa. Your Excellency’s presence at this conference is indeed a testament to your deep commitment to the promotion of economic prosperity and the enhancement of regional co-operation. On behalf of the Central Bank of Sri Lanka and the SEACEN Governors, I sincerely thank Your Excellency for accepting our invitation and gracing this occasion. We also eagerly look forward to Your Excellency’s inaugural address which will set the tone for our deliberations at our conference and we thank your Excellency in advance for accepting our invitation to do so.

I also extend a very warm welcome to the Governors and Heads of Delegations of the SEACEN member Central Banks who have arrived in Sri Lanka to attend this conference. Your commitment to the development of the SEACEN Centre has helped it progress rapidly over the years to become a highly sought after training and research centre, and we deeply value your efforts in this regard.

I am particularly pleased to extend our welcome and gratitude to Dr. Choongsoo Kim, Governor of the Bank of Korea for so graciously accommodating our request to host this Conference in Colombo this year, so as to mark our 60th anniversary, when it was rightfully Bank of Korea’s turn. Your gesture of friendship and support is appreciated by us very much.

Let me also take this opportunity to welcome the People’s Bank of China, which joined the SEACEN Group in January this year. As a result, the membership of the SEACEN now stands at 17, substantially up from the original number of eight Central Banks. The recent entry of the People’s Bank of China will no doubt widen the scope for regional cooperation on economic and financial issues amongst member Central Banks and we are excited by these promising new prospects.

It is also my great pleasure to welcome the Governors and Delegates representing the Central Banks of the SAARC Region who have accepted our invitation to attend this conference. Our welcome is also further extended to Mr. Naoyuki Shinohara, Deputy Managing Director of the International Monetary Fund who has graciously accepted our invitation as the Keynote Speaker and Mr. Jaime Caruana, General Manager of the Bank for International Settlements who is due to deliver a special address at the Conference.

In addition, I extend a warm welcome to all our distinguished speakers and express our gratitude for honouring our invitation. Our special gratitude is also due to all our guests this morning for their gracious presence at this opening ceremony of the 46th SEACEN Governors’ Conference.

Your Excellency, Fellow Governors, Ladies and Gentlemen, this conference marks the highlight of our 60th anniversary celebrations, when we proudly proclaim to the world that our Central Bank has been able to successfully guide the economy of Sri Lanka towards stability and growth during many challenging periods in the world’s history as well as our very own.

At the same time, our country is now experiencing a new era of peace and development, having firmly put behind us, the turbulent three decade period that hampered our country’s economic and political progress. Today, under the visionary and courageous leadership of our President, His Excellency Mahinda Rajapaksa, we are embarking on a fast track development phase towards prosperity and evidence of that progress will be seen by you whenever you travel about our country over the next few days.

Your Excellency, Fellow Governors, my dear friends. Every few months or so, I eagerly look forward to interactions with my fellow Governors at several international fora, for a very good reason. As all of us know, being the Governor of a Central Bank is a highly stressful and tense occupation. Each day, we have fresh challenges to face. The challenges that our predecessors faced perhaps over a 10 year period, will be on our tables over the period of 10 days! The contagion effect that would have been experienced in economies in times of turmoil over a period of two to three weeks in the past would be upon us now in two to three minutes! Political developments are so rapid today and have such a huge bearing on economic matters, that some governments are even requesting their Governors to get political lessons!

The pace at which world news filtered through to our predecessors in the 70s and 80s is at snail’s pace, when compared to instant updates that we receive on our mobile phones even when we travel thousands of miles away from home. The challenges and extraordinary developments that we face today do not often have precedents, previous case studies or textbook solutions. These pressures naturally take a heavy toll on Governors and I think it takes a lot of effort just to stay calm, cool and focussed in the midst of so much uncertainty and turmoil.

Fortunately however, that gloomy picture changes when Governors meet! Our informal interactions as well as the formal parts of our meetings and conferences often give us the comfort that we are not the only persons who face such challenges. During our meetings, we share ideas; we compare notes; we learn from each other’s experiences; we see what works, what does not; we see issues and challenges from different angles; we understand the inner workings of different policy measures; we are reminded of unintended consequences; we are warned of possible pitfalls and deadly booby-traps. All in all, we gain strength from each other. That is why I look forward to these Governors’ interactions so much. These help me to re-focus, re-energise and re-invent. So, let me thank all of you for visiting Sri Lanka and participating at this year’s SEACEN Conference.

All of you will, in one way or another, inspire us and we are very grateful for your presence and participation. My dear friends, after nearly five years as the Governor of the Central Bank of Sri Lanka, it has been my privilege to closely assist His Excellency Mahinda Rajapaksa and his Government to steer our country through a most difficult period in our economic and political history. History will probably record that we were able to manage our economy through a devastating war, a crippling global financial crisis, a chaotic worldwide banking debacle, a critical global food crisis and a highly debilitating oil crisis; these were upon us one after another, without even providing us any breathing space, in between!

Today, our country is positioned for great deeds in developing infrastructure and delivering prosperity to our people. That is why we are excited about sharing our story with you, who have, in different ways, inspired us in our journey. We are delighted that you will deliberate on the topic ‘Post Global Financial Crisis: Issues and Challenges for Central Banks of Emerging Markets,’ which is a topical subject that is of concern to all our central banks.

As emerging economies, many of us are facing higher capital flows and greater excess liquidity. The composition of Central Bank balance sheets has changed significantly as we try to tackle these issues. However, these changes themselves entail new risks, which cannot be overlooked in the process of trying to achieve price and financial system stability. These are some of the key areas that warrant serious attention, and this Conference therefore, presents the ideal platform for us to discuss the various aspects of these issues and workout a possible best way forward.

My dear Governors and Delegates, my team and I have spared no pains to make your visit to Sri Lanka a memorable one. We are looking forward to providing you with an excellent platform for the high level deliberations that you would be engaged in, spiced with the hospitality and friendship that Sri Lankans are well known for. We hope that even for a short while, our hospitality will help you to forget the onerous burdens that you carry on your shoulders.  As for our benefit, we believe that all your deliberations would greatly enhance our own capacities and capabilities to deal with whatever issues that we have to face in our economy in time to come. Let me therefore once again, thank all of you and wish you a very fruitful and successful conference. Thank you.