BIZweek n°326 22 jan 2021
BIZweek n°326 22 jan 2021
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  • Parution : n°326 de 22 jan 2021

  • Périodicité : hebdomadaire

  • Editeur : Capital Publications Ltd

  • Format : (260 x 370) mm

  • Nombre de pages : 6

  • Taille du fichier PDF : 4 Mo

  • Dans ce numéro : interview de Carl Chirwa de Bank One.

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VENDREDI 22 JANVIER 2021 BIZWEEK ÉDITION 326 AUTHORS CATALINA MARGULIS, Consulting Counsel in the IMF Legal Department’s Financial and Fiscal Law unit, seconded from the Central Bank of Chile ARTHUR ROSSI, Research Officer in the same unit Letter of the law Most central banks can issue only physical cash. (legal auth onzal Ion la Issue currency) Law does rot limit issuance to banknotes and coins. 40 central banks 23% Law is net clear. 27 central banks 16% Source  : IMF staff calcu laitiers INTERNATIONAL MONETARY FUND Legally Speaking, is Digital Money Really Money ? Any money issuance is a formof debt for the central bank, so it must have a solid basis to avoid legal, financial and reputational risks for the institutions. Ultimately, it is about ensuring that a significant and potentially contentious innovation is in line with a central bank’s mandate. Otherwise, the door is opened to potential political and legal challenges. Now, readers may be asking themselves  : if issuing money is the most basic function for any central bank, why then is a digital formof money so different ? The answer requires a detailed analysis of the functions and powers of each central bank, as wellas the implications of different designs of digital instruments. Building a case for digital currencies To legally qualify as currency, a means of payment must be considered as such by the country’s laws and be denominated in its official monetary unit. A currency typically enjoys legal tender status, meaning debtors can pay their obligations by transferring it to creditors. Therefore, legal tender status is usually only given to means of payment that can be easily received and used by the majority of the population. That is why banknotes and coins are the most common formof currency. To use digital currencies, digital infrastructure—laptops, smartphones, connectivity—must first be in place. But governments cannot impose on their citizens to have it, so granting legal tender status to a central bank digital instrument might be challenging. Without the legal tender designation, Law only authorizes issuance of ban knotes and coins. 104 central banks 61% POST SCRIPTUM Countries are moving fast toward creating digital currencies. Or, so we hear from various surveys showing an increasing number of central banks making substantial progress towards having an official digital currency. But, in fact, close to 80 percent of the world’s central banks areeither not allowed to issue a digital currency under their existing laws, or the legal framework is not clear. To help countries make this assessment, we reviewed the central bank laws of 174 IMF members in a new IMF staff paper, and found out that only about 40 are legally allowed to issue digital currencies Retail or wholesale ? Accounls for private citizens are mostly rot allowed. (a bility la open current aceounts) Law is unclear. 15 central banks 9% Source, IMF staff calculations achieving full currency status could be equally challenging. Still, many means of payments widely used in advanced economies are neither legal tender nor currency (e.g.commercial book money). Uncharted waters ? Digital currencies can take different forms. Our analysis focuses on the legal implications of the main concepts being considered by various central banks. For instance, where it would be « account-based » or « token-based ». The first means digitalizing the balances currently held on accounts in a central banks’books ; while the second refers to designing a new digital token not connected to the existing accounts that commercial banks hold with a central bank. From a legal perspective, the difference is between centuries-old traditions and uncharted waters. The first model is as old as Law allows to open accounts with public. 10 central banks 6% Law only allows to open accounts with (i) state, (hl banks, (iii) employees of the central bank. 146 central banks 85% INTERNATIONAL MONETARY FUND central banking itself, having been developed in the early 17th century by the Exchange Bank of Amsterdam, considered the precursor of modern central banks. Its legal status under public and private law in most countries is well developed and understood. Digital tokens, in contrast, have a very short history and unclear legal status. Some central banks are allowed to issue any type of currency (which could include digital forms), while most (61 percent) are limited to only banknotes and coins. Another important design feature is whether the digital currency is to be used only at the « wholesale » level, by financial institutions, or could be accessible to the general public (« retail »). Commercial banks hold accounts with their central bank, being therefore their traditional « clients. » Allowing private citizens’accounts, as in retail banking, would be a tectonic shift to how central banks are organized and would require significant legal changes. Only 10 central banks in our sample would currently be allowed to do so. A challenging endeavor The overlapping of these and other design features can create very complex legal challenges—and could well influence the decisions made by each monetary authority. The creation of central bank digital currencies willalso raise legal issues in many other areas, including tax, property, contracts, and insolvency laws ; payments systems ; privacy and data protection ; most fundamentally, preventing money laundering and terrorism financing. If they are to be « the next milestone in the evolution of money, » central bank digital currencies need robust legal foundations that ensure smooth integration to the financial system, credibility and broad acceptance by countries’citizens and economic agents. 4
VENDREDI 22 JANVIER 2021 BIZWEEK ÉDITION 326 In this unprecedented era caused by the Coronavirus outbreak, many familiar features of the corporate governance landscape have changed significantly. Organizations are facing difficult times as the measures being deployed to slow the spread of COVID-19 are impacting capital markets, supply chains, and business operations. « A strong corporate culture, reinforced by effective governance practices, is more important than ever in this post-pandemic era and thus, treating corporate governance as last priority on the board’s agenda is the last thing to do. Undeniably, Boards are facing a complex new reality as a result of BREAKFAST FORUM AND PANEL DISCUSSION ON ‘CORPORATE GOVERNANCE IN THE POST COVID ERA’COVID-19 where the new environment is characterized by pressures and demands from various stakeholders, heightened expectations for societal engagement. The uncertainties of the current environment serve as a powerful reminder to decision-makers of the need for corporate governance, including risk management and crisis planning amongst others, to ensure business Q DEBRIEF « Boards are facing a complex new reality as a result of COVID-19 » The Mauritius Institute of Directors hosted, on Wednesday, a panel discussion exclusively for its members, from both private and public sectors, comprising of an esteemedpanel of business leaders and policy makers to address the issue of ‘Corporate Governance in the post COVID era’. During the forum, the discussion panel moderated by Sheila Ujoodha has featured salient themes such as best practices in Corporate Governance, its significance on business responsibilities, organisational performance, board diversity and corporate culture makes searching simple steadiness. The aim of this forum is to open the discussion to national and international business leaders and policy makers on this specific theme, which challenges the shareholder-centric model of governance that has guided boards and business leaders for the past years, » said Sheila Ujoodha, Chief Executive Officer at the Mauritius Institute of Directors. PhoenixBev lance sa nouvelle robe et ouvre une nouvelle boutique à Grand-Baie Le lancement officiel de la nouvelle identité - PhoenixBev Wines & Spirits – le pôle vins et spiritueux de Phoenix Beverages Limited (PBL) s’est tenu le mercredi 20 janvier 2021 dans la nouvelle boutique de Grand- Baie. Koté Vins devient ainsi PhoenixBev Wines & Spirits afin de bénéficier de toute la force de frappe du groupe PBL. La première boutique de PhoenixBev Wines & Spirits (anciennement Koté Vins) se trouve depuis 6 ans à Phoenix. Elle offre plus de 800 références en termes de vins et de spiritueux, riches en histoire ainsi qu’en saveurs, notamment du Japon, le Chili, la Nouvelle-Zélande, l’Australie, l’Afrique du Sud, la France, et l’Italie. Neuf artistes en herbe récompensés par la SBM Bank (Mauritius) Ltd La SBM Bank (Mauritius) Ltd a organisé, le jeudi 14 janvier 2021, une cérémonie de remise des prix dans le cadre du concours ‘SBM Amigos Drawing & Painting Competition’qui a été lancé en novembre 2020. Neuf gagnants ont été récompensés dans les trois catégories de ce concours. Ils sont Devesh Teeluck, Aiden Miguel Lalljee et Darshil Jheengut dans la catégorie 5 à 8 ans ; Maheera Dowlut, Vainavi Udantika Arjoon et Ourousha Bibi Zaina Akbar dans la catégorie 9 à 12 ans ; et Lisa Grace Ng Hing Cheung, Bibi Aisha Akbar et Taalvin Krishna Coolen dans la catégorie 13 à 17 ans. A noter que plus de 500 participants s’étaient inscrits à ce concours ouvert au grand public. Official online directory of Mauritius Telecom Business People 5

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