Special role of central banks

Central bank of Malaysia's Governor Zeti Akhtar Aziz on the role of central banks in emerging economies and the importance of safeguarding central bank independence:

In most emerging economies, the largest concentration of talent resides in the central bank, providing it with the resources and intellectual capacity to undertake multi-faceted developmental roles that extend beyond our core mandates. The fact that central banks are often a highly-regarded public institution in a country also lends it to having greater legitimacy in addressing challenging domestic issues.

In managing this role effectively, three elements are key: clarity of the outcomes to be achieved, a governance process which gives clarity on the decision making process and accountability, and finally, ensuring the integrity and the independence of the Central Bank is not undermined.

An interesting take on the peculiarities of conducting central banking business in Asia. My own experience suggests that one of the biggest challenges for many Asian countries is to gain, and maintain, central bank independence.