Your Excellency
Dr. Seyyed Shamseddin Hosseini,
Minister of Economic Affairs and Finance
of the Islamic Republic of Iran,
Distinguished delegates,
Excellencies,
Ladies and gentlemen,
I take pride in welcoming you all in the working Group Meeting on “Global Financial Crisis- Lessons Learned and Experience Gained by ECO Member Countries”. I am particularly grateful to the Ministry of Finance and Economy of the Islamic Republic of Iran for hosting this important meeting in Tehran.
At the inauguration of the 3rd ECO Ministerial Meeting on Finance and Economy (Tehran- December 2009) and again as Chairman of the 10th ECO Summit (Tehran, March 2009), the Honourable President of the Islamic Republic of Iran underscored the need for an in-depth study of the Global Financial Crisis and for drawing up appropriate recommendations. The President suggested establishment of a Working Group of Experts from Member States to study the negative implications of the Global Financial Crisis on the economies of the ECO countries. The Ministry of Economic Affairs and Finance of Iran, taking forward the commitment of the President, is hosting the meeting to exchange views on the issues that led to global economic meltdown.
In the wake of the Crisis, all the major economies suffered as growth contracted. Its negative impacts, though less pronounced in majority of ECO countries, did however, slowed down economic and commercial activities. There is now a greater need to first, restore the pace of economic development and then more importantly, to ensure preparedness to tackle similar situations in future. It calls for a multi-dimensional approach. We have to harmonize our policies, national laws, and regulations etc. At the same time we have to build on our regional strengths to provide sound base for economic growth. We need to work on these lines in tandem through concerted efforts. We have to put in place a comprehensive framework of regular consultation and cooperation at the regional level taking all the stakeholders on board. Such an approach could help forewarn the region about any emerging crisis in the future and would also provide us reaction-time to develop coordinated response to mitigate its negative influence on the economies of the region. This meeting offers us an opportunity to share our experiences and deliberate on future strategy. I am confident that this exchange of information would lead us to develop better understanding and propose practical solutions towards that end.
I strongly urge participants to deliberate on issues with a sharper focus for practical and lasting solutions to the regional economic challenges.
Excellencies,
Today trade policy is at the forefront of the world development agenda. Its relevance for the ECO region is critical for any strategy to fight poverty and other pressing socio-economic problems. ECO as an intergovernmental organization has to catch up fast with other regional organizations in promoting regional trade. The competitive advantages of the region, in terms of natural wealth and human resources are immense. The bright growth prospects have to be sustained for enhanced intra-regional trade and investment. We believe that a full scale implementation of ECO Trade Agreement (ECOTA) and the removal of Non Tariff Barriers (NTBs) will surely augur well for further expansion of intraregional trade.
The commitments have been made at the highest political levels to accelerate trade liberalization process in the region. A Free Trade area in the region is to be created by 2015. We are setting up important landmarks toward that end. We have signed a set of agreements on investment promotion, customs cooperation and visa facilitation. The ECO Trade and Development Bank is now fully functional and the ECO Reinsurance Company has been established. Private sector cooperation is being strengthened through ECO-Chamber of Commerce and Industry and specialized trade representative bodies. We have lately taken a few fresh initiatives for trade facilitation, capacity-building and bridging the information gap.
Excellencies,
Our plans for trade depend heavily on the regional cooperation in diverse areas of finance and economy. ECO initiatives in finance, investment, customs and banking are directed at promoting healthy commercial relations among the Member States. To further knit the relevant institutions, we hope to achieve progress through three of the ECO high level forums which include the Ministerial Meetings on Finance and Economy, the Heads of Central Banks and Heads of Customs Administrations.
The ECO Ministerial Meetings on Finance and Economy have been institutionalized. These have been instrumental in promoting cooperation in the key areas of economic and financial management, including banking, taxation, audit and corporate law. Enhanced cooperation for exchange of information and experiences in implementing fiscal, monetary and other macro-economic policies as well as budget execution will be deliberated in upcoming Ministerial Meetings. The Council of Heads of Customs Administrations successfully finalized two agreements which aim at harmonization of customs regimes and assistance in combating illegal trade.
The ECO Heads of Central Banks have agreed to facilitate branches of the member states’ banks, to encourage sharing of experiences and promote capacity-building. They also agreed to cooperate in the fight against money-laundering and financing of terrorism. We are pursuing all these and will review progress at the 2nd ECO Heads of Central Banks meeting shortly
We understand that economic challenges internal to our region demand effective reforms, stronger economic fundamentals, sound industrial policies and rigid financial controls. ECO economies, having followed appropriate strategies for a steady long-term growth combined with diversification were able to absorb the after shocks of the Crisis. In banking and insurance sectors, much of our potential still remains unutilized.
Excellencies,
As globalization gathers pace, the challenges of international multi-lateral trading systems would continue to haunt our vulnerable economies. The financial crisis is also an indicator for preparedness. It is time to foster closer cooperation to serve the region’s best interests. We have to be capable enough to convert challenges into opportunities for the people of the region. Improvement in macro-economic management and fiscal systems has to be ensured to stimulate growth. We can not afford to put off the implementation of agreements in trade, investment and customs. To counter and contain the negative impact of events taking place at global scale we need urgent and effective measures.
From the ECO perspective, it is the trade liberalization that could increase intra-regional trade and prevent the expansion of recession caused due to outward factors. Government's support to provide capital and liquidity required by the private sectors is necessary to keep pace of the trade expansion, industrial growth and increased inflow of Foreign Direct Investment. Measures to support private sectors in order to preserve their competitive capabilities with other countries in exporting goods are to be reinforced. Our endeavor to increase productivity and reduce the costs of production is to be attached greater importance.
In the fiscal arena, a number of effective structural reforms and concrete actions are needed to intensify cooperation among financial institutions. Free capital movement, investment and sustainable joint ventures could substantially add to the economic development. Over hauling of exchange rate policies and supportive programmes are to be initiated for capital formation. A road map is to be developed so that Member States may seriously consider adopting barter system in trade among them. We have to increase use of reliable foreign currencies in regional transactions, the exchange of foreign financial resources with reliable currencies as well as establishment of regional monetary to cope with the similar crisis situation in future. Joint efforts would also be needed to adopt common strategies to remain engaged with international financial institutions.
Excellencies,
We have to look for long term collaborations to accelerate pace in all areas of cooperation. A more favorable, safer and secure environment for expansion of the ECO economies, especially the smaller economies is to be created. It is hoped that this meeting will generate the desired momentum to deepen our cooperation in all sectors of finance and economy. Your support and guidance will surely help ECO in moving further closer to its ideals. I wish you all total success.
Thank you.
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