 Mae Rai Rydw i'n gwych am y dyfodol. Yn yn gweithio i chi'n meddwl ar hyn o'r bwrt yw, za yw ddrwy'r gymuned ynendo'r hollu am yma i'n fynd mewn Macro? Be gyd, ysbryd o hynny, y maen nhw i ddatblygiadau a bydd eich cynnig ar gyfer erioedd cael ei stori y cwyminte ond ymddangos ar y cwymneud. Mae'r rhai rhywbeth i'n fwy o rhai i darwod i'n ei sgwpeth – ac mae'r cyfrifledd yn ei ddechrau o ar y cyfrifledd ar gyfer yn ein cyrraff yng nghymru 85 yw 2015, a ydych chi'n cael ei ddweud? Rwy'n gweithio'r stori africa yn y 80-er y reisession a'r stabilisio. Rwy'n gweithio'n africa yn 1980, mae'n gweithio'r ymgyrch yn ymgyrch yn ymgyrch o'r ffordd yw'r crisis yw'r cynllun yw'r economist ac ymgyrch. Mae'r rhai, rhai, rhai, rhai ti'n gweithio. ac nid ydych chi'n gael y llunio yma, y llunio, y llunio. Y gril yma, ychydig hynny o ran ymgyrch, ymgyrch ymgyrch yma, yma yw'r UF fedd. Felly ei gael y gril yma yn yr UF fedd i'r Llywodraeth. Felly bydd y bydd yn gweithio yma yn y economi ymgyrch. Ond ydych chi'n gweithio yma yw'r unig yw'r gwahonydd. Mae'r ffordd yng Nghymru yw'r ffordd a'r company yw'r ffordd yw'r ffordd o'r hynny. Mae'r ffordd yn y cyfeirio'n bach am ymgyrch yn bach yw'r ysgrifennu ymgyrch yw, ymgyrch chi'n gweithio'r banrhan yn ymgyrch yma yw'r ffordd. Felly hynny'n gweithio'n gweithio oherwydd y gwaith a'r gweithio'n gwybod yn ymgyrch. Creditors are not your friends and you learn that at a pretty catastrophic moment when you've run out of policy options and you're being forced into a position of debt service, continued debt service at the cost of public spending or indeed debt default and exit from the sovereign market. So looking ahead a little bit the left hand column we've already gone through HIPIC debt relief was of course a big one around the early 90s. We had a big wider conference here around about 2000 about HIPIC debt relief. One of the issues of the 80s and 90s was restoring fiscal management and the fiscal stance that Steve mentioned. I do urge you to take a look at the Stiglitz 98 annual wider lecture which is on the website because there Joe was really having a go at IMF policy around Ethiopia. At that point in the late 90s many countries were still very much a dependent for their public finances. We moved on somewhat from that. The issues around Dutch disease and the management of Dutch disease still a big issue for us. Looking forward what we might see over the next 30 years and I'm looking forward to coming back to the annual conferences we'll have celebrating my road 35, 40, 45 and then I'll turn up a ghost at the 50th probably. Really the bigger task of how you're going to build domestic revenues into your macroeconomic framework in a more profound sense. We're going to have a session on tax issues this afternoon but really you know the optimism around aid has pretty much disappeared. If you want to be reliant on aid and unfortunately still many countries are you might turn out to be very disappointed and really building stability into your macroeconomic framework when you are so reliant unexpectedly on domestic revenues including obviously domestic debt issued in domestic bond markets as well as your sovereign rent. The management of debt this has been discussed by the previous two speakers. I think the issue of infrastructure bonds which Ethiopia and other countries have done, Kenya has done quite successfully is a very interesting area and in some ways if you get the rate of return right on the infrastructure and the rate of return exceeds the debt that you've issued then you're good. You're good for growth and you're good for a more expansionary macro policy down the line but you know the task around actually managing and appraising infrastructure to get the right kinds of infrastructure projects that do really deliver you the growth to repay the debt are not as easy as sometimes people pretend. Big issues around financial deepening and inclusion obviously notably Rajan in India has gone out on a big campaign around getting the financial system to be more inclusive as poor people are not just reliant on micro finance. Going forward I think one issue that we haven't really explored much in developing countries is the macro impact of demographic change. We're going to see very big rises in populations over the next 30 years. The golden period the demographic dividend as it's called will have savings and investment implications and then finally the really big one which is the macroeconomic impact of climate shocks and what they will mean potential loss of revenue potential loss of key export sectors how that how that how we can build resilience into the macroeconomic framework on that. Okay well let me in my last few minutes just switch gear and think about a little bit about what's happening at the moment. Give you some thoughts well that's happening at the moment crude oil has gone woo don't need to tell you that and commodity prices have generally gone down with it. I'm not going to talk here about about food commodities though they're important there's another wider project led by Peir Pinstrup Anderson on that but we are seeing what for many people was quite an unexpected shock. We could have a lot of discussion about the causes of that shock but we have a very interesting geopolitical combination where OPEC is trying to drive out sorry Saudi Arabia is trying to drive out US shale producers it's finding that as a much tougher job the oil market oil demand is is still growing China is still importing oil but there is just a massive oversupply and Iran is adding to that. There is an overall lift to the global economy the IMF has given out some recent estimates but a lot of the oil importers actually some of them can't take much advantage of that because they have structural problems structural rigidities on their export side infrastructure energy so some of the net benefit of the oil price drop to the oil importers has not been as big as we'd have expected and of course some of the countries are suffering themselves from the sell-off in metals Zambia on copper South Africa we've discussed so there's suffering a simultaneous terms of trade shock so things are improving on the on the import side through a lower oil price but deteriorating on the commodity side. We've seen that some have ample fiscal busfers the example of Botswana always comes up but many do not Angola and Nigeria Steve has already mentioned are finding themselves in a very difficult position the average fiscal loss is about four percent of GDP that's a lot more to some of the smaller exporters what do you do in that situation or many of them are running down their foreign exchange reserves or depreciating their currencies they're running the classic risk of maintaining the peg at the danger or cost of rapidly losing reserves if you look at say the Venezuela case Venezuela is probably on the edge of default one of the most difficult cases a rapid movement into fiscal deficit a bit difficult to read this diagram but the story here is a big drop in reserves including Nigeria some countries like Indonesia are in much better position because they've diversified exports but generally it's a difficult period some countries have maintained pegs but now we're abandoning those pegs others are conducting large depreciations they're being helped along the way that some of the hedge funds for example are shorting commodity currencies so if you want to short copper one way you can short copper is short the Chilean currency and likewise probably other emerging currencies Malaysia's currency is right down as well and some of the african countries as well as we've seen are undergoing quite large depreciations Beno Ndulu was going to be at this conference but he's busy dealing with some of this okay so for the last five minutes or so let's talk debt and there's only really one thing to say about debt which is uh James Carville said it um he was Clinton's advisor in the 90s he said so when he when he comes to reincarnation Carville said I want to come back as the bond market because you get to just you know get to intimidate everybody you know finance ministers live in fear of the bond market um to degree in low income countries middle income countries it's quite a good thing that they start to live in fear of the bond market because it's a sort of you know countervailing check on policy and it's something that you know obviously goes with becoming a richer and more developed country but the bond market is not necessarily your friend and as Steve mentioned Garner is now back in the hands of the IMF our respondents from Garner might want to say something a little bit more about what they see as the situation going forward the Fed tightening is the big question fortunately we had the Fed timed last night just before this session and the Fed chairman came out with a statement saying that the Fed is actually holding after a long expectation it would begin rising partly because of emerging market concerns if we knew the answer to when the Fed would start tightening then you know all of us in this room would be very rich people we can't predict stress in the bond markets has been relatively limited so far to oil companies which are in deep trouble some of the smaller ones Venezuela which i've mentioned before there's more of an outflow in terms of stock markets equities exacerbated by the china boom and then bust earlier this year to a degree emerging market bonds have priced in a lot of the fed eventual rise but there's a lot of corporate debt sitting there particularly in dollars and a lot of it sitting in asia and quite a lot of it sitting in china and so if you want to rerun the 98 asian financial crisis story you might want to run it look at the level of corporate debt in dollars particularly in asia but also now in africa to degree but the fed tightening it could be quite modest the slowdown in china and the depreciation of the chinese currency is to degree exporting deflation into the us now constraining the feds move this is where in some ways you know if you 30 years ago you had said that china would have affected us monetary policy people would just thought you were crazy taking you out of the room so we have in some many ways just changed in the geo geopolitics of economic policy and europe of course is weak so the fed tightening could be quite modest and that's a graph of em bond spreads you can see actually that you know venus well as the red one they are in serious trouble the oil price is the thing going down but even argentina actually is not seeing too much chaos yet but we shall see headwinds i'll start to finish up now we still have weak institutions grease demonstrated that we still do not have effective sovereign debt bankruptcy despite the push by many economists ranging from ideological opposites like ancroga to joe stiglitz pressing for proper debt workout mechanisms for sovereign bankruptcy we still have too much reliance on self insurance by maintaining high foreign exchange reserves and we still have asymmetric adjustments in the global system so i'd like to end by saying there's a lot of big questions that we need to answer in macroeconomic policy we have moved forward in 30 years and i think this is where i'm going to say one last thing which is going to congratulate the way in which we've been able to work in africa and particularly the role of arc in improving the quality of the macroeconomic conversation and debate and effectiveness in policy and if there's been one really big change for africa i think that's been one of the most welcome changes so thank you mr chairman