The Governor, State Bank of Pakistan, Dr Shamshad Akhtar has proposed the
launching of an ECO Central Banks Network (ECBN) with a view to enhance cooperation
amongst respective central banks of member countries of the Economic Cooperation
She made this proposal while addressing the first meeting of the heads/representatives
of central banks of ECO member countries at a local hotel in Karachi today.
Dr Akhtar said that the proposed network could focus on exchange of experiences
and information on economic and monetary policy approaches and respective banking
regulations. The network could also help nurture greater cross border cooperation of financial
flows including possibilities of cooperation on anti-money laundering and explore
opportunities for harmonization of standards and systems, where feasible, she added.
Dr Akhtar underlined that the cooperation would involve sharing perceptions on the
objectives of policy coordination and corresponding institutional coherence for:
(i) Macroeconomic and Financial Stability. This could cover discussion on exchange
rate regimes, prudent debt management domestic financial deepening, and
international developments. In addition, there should be discussion on the level and
extent of harmonization of banking sector policies and regulations to the extent
(ii) Launching of a study to benchmark the state of economies, monetary policy regime
and banking sector, their size & dimensions, and comparison of banking sector
policies and regulation, and state of corporate governance etc.
(iii) Developing an agreed approach and framework for encouraging and facilitating
opening of bank branches by the member countries in each others’ territories.
(iv) Facilitation to intraregional trade and commerce. To support this, the network should
devise an efficient settlement framework and to examine the correspondent banking
facilities for trade finance transactions.
(v) Promoting capacity building among member central banks. Among others, Pakistan
would offer its National Institute of Banking and Finance to serve as a regional hub
for training of central banks’ staff and launching specific courses for banking for the
region. Member states should proactively participate in structuring course work and
delivery in this hub.
(vi) Enhancement of supervisory regimes for financial sector in member countries. Work
together to strengthen the supervisory regimes in respective jurisdictions by
enlightening ourselves with each others’ experiences and best practices.
(vii) Sharing of information and experiences. We need to establish and strengthen regular
mechanisms of consultations, communication, the sharing of information and
expertise as well as the identification and implementation of joint projects and
activities among the member countries.
It may be mentioned that ECO is an inter-governmental regional organization
established in 1985 by Iran, Pakistan and Turkey. In 1992, the organization was expanded to
include seven new members, namely: Afghanistan, Azerbaijan, Kazakhstan, Kyrgyz
Republic, Tajikistan, Turkmenistan and Uzbekistan.
The ECO region, which has a population of 400 million, has tremendous economic
potential and offers promising ground for fostering economic integration. The region is
growing at around 6.2% on average, while real gross domestic product in the region
aggregates to $800 billion. The region is home to 8% of the world’s crude oil production and
9.2% of global natural gas production.