ECCB 2014-2015 Annual Report and Statement of Accounts

EASTERN CARIBBEAN CENTRAL BANK

Monetary and exchange conditions in the countries of the Eastern Caribbean Currency Union (ECCU) remained stable in 2014, primarily influenced by the continued resilience of the exchange rate ] [

the establishment of an appraisal institute, which are intended to improve the property appraisal process for collateral in the commercial banks. During the year, the Bank supported the initiative of the national banks to consolidate their operations to achieve economies of scale and, in particular, research undertaken to facilitate the integration of the national banks. As part of the Fiscal Reform Programme, the Monetary Council assessed the debt target of 60.0 per cent of GDP to be achieved by 2020 and, in light of the weak growth performance, approved the extension of the target date to 2030. The Council also agreed that member governments should consolidate their fiscal operations to facilitate the achievement of the target. As part of the fiscal consolidation programme, the Bank continued to provide technical support to member countries to strengthen their debt management capacity through the Debt Management Advisory Service (DMAS) unit at the ECCB. The Unit is sponsored by the Department of Foreign Affairs, Trade and Development (DFATD) of Canada. In promoting the growth and development of member countries, the Bank supported the OECS Business Council as the representative body of the private sector in the currency union. During the year, the interim

Board of the Business Council was transitioned into a permanent Board. The Business Council is expected to coordinate the programmes for the development of a dynamic and competitive private sector and a viable export sector. In support of the growth initiatives, the Bank continued to coordinate the assessment of the investment climate through The World Bank’s ‘Doing Business’ Project. Given the critical role of the public sector in facilitating growth and development, the Bank continued to consult with the public sector unions on wages, prices and productivity particularly in their review of the wage negotiation process and the structure and operations of the public sector. M onetary P olicy Monetary and exchange conditions in the countries of the Eastern Caribbean Currency Union (ECCU) remained stable in 2014, primarily influenced by the continued resilience of the exchange rate. The integrity of the fixed exchange rate arrangement was not compromised, as the currency continued to be adequately supported by foreign reserves. The foreign reserves to demand liabilities (backing) ratio averaged 95.94 per cent during 2014, comfortably above the MONETARY STABILITY

8

ECCB ANNUAL REPORT 2014/2015