The 10th SAARC Summit of the Head of the States of the SAARC Region which was held in Colombo on July 29, 1998 agreed, in principle, to establish a "Network of Central Bank Governors and Finance Secretaries of the SAARC Region (SAARCFINANCE)" with a view to opening dialogues on macroeconomic policies of the region and sharing mutual experiences and ideas. Accordingly, the SAARCFINANCE was established on September 9, 1998 as a regional network of the SAARC Central Bank Governors and Finance Secretaries. It is a permanent body, which got formal recognition of SAARC at the 11th SAARC Summit, held in Kathmandu, Nepal in January 2002. As per the decision of the Summit, Chairperson of SAARCFINANCE is invited to the sessions of the SAARC Council of Ministers to make a presentation on SAARCFINANCE activities.
The basic objective of establishing the SAARCFINANCE Network is to share experiences on macroeconomic policy issues among member countries of the region. However, the broad objectives of the SAARCFINANCE Network are as follows:
- To promote cooperation among central banks and finance ministries in SAARC member countries through staff visits and regular exchange of information.
- To consider and propose harmonization of banking legislations and practices within the region.
- To work towards a more efficient payment system mechanism within the SAARC region and strive for higher monetary and exchange cooperation.
- To forge closer cooperation on macroeconomic policies of SAARC member states and to share experiences and ideas.
- To study global financial developments and their impact on the region including discussions relating to emerging issues in the financial architecture, IMF and World Bank and other international lending agencies.
- To monitor reforms of the international financial and monetary system and to evolve a consensus among SAARC countries in respect of the reforms.
- To evolve whenever feasible joint strategies, plan and common approaches in international fora for mutual benefit particularly in the context of liberalization of financial services.
- To undertake training of staff of the ministries of finance, central banks and other financial institutions of the SAARC member countries in subjects relating to economics and finance.
- To explore networking of the training institutions within the SAARC region specializing in various aspects of monetary policy, exchange rate reforms, bank supervision and capital market issues.
- To promote research on economic and financial issues for the mutual benefit of SAARC member countries.
- To consider any other matter on the direction/request of the SAARCFINANCE, Council of Ministers or other SAARC bodies.
The SAARCFINANCE Chair is held by the Governor of the Central Bank and moves in rotation with the change of the SAARC Chair. SAARCFINANCE Secretariat functions are undertaken by the central bank of the country that holds chairmanship of SAARC.
Each central bank established a SAARCFINANCE cell to coordinate the activities of SAARCFINANCE. Member central banks also appoint a Coordinator. The Coordinator of the central bank of SAARC Chairperson's country acts as the central Coordinator.
SAARCFINANCE Group Meetings
The SAARCFINANCE Group meets twice a year concurrently with the IMF/WB annual and spring meetings.
SAARCFINANCE Coordinators' Meetings
To facilitate the working of the SAARCFINANCE network, it was decided at the 13th SAARCFINANCE Group meeting that Coordinators should meet twice a year and 2-3 delegates could represent each country.
As per the decision of the 14th SAARCFINANCE Group Meeting held in Singapore on September 20, 2006, the SAARCFINANCE Chair has to publish half-yearly SAARCFINANCE e-Newsletter. It is a regular electronic publication designed mainly to present news items related to SAARCFINANCE activities.
Staff Exchange Program
Since the inception of the SAARCFINANCE a good number of officers visited various institutions of member countries under Staff Exchange Program. The matters of the Staff Exchange covered a broad range of issues ranging from risk-based supervision to human resource management and forward marketing arrangements for agricultural product, etc. Considering the effectiveness of the staff exchange program and also in the case of training, seminars, etc., the matter of cost sharing is left entirely to the country concerned.
The SAARCFINANCE members conducts seminars/workshops/special studies on common topical issues. It was decided at the 13th SAARCFINANCE Group meeting that every member central bank (except Bhutan and Maldives) would organize at least one seminar every year.