Recommendation on the development of national Year 2000 strategies

6 July 1998

Press release

JOINT YEAR 2000 COUNCIL
BANK FOR INTERNATIONAL SETTLEMENTS, CH-4002 BASLE

Basle Committee on Banking Supervision
Committee on Payment and Settlement Systems
International Association of Insurance Supervisors
International Organization of Securities Commissions

Press Communiqué

6th July 1998

The Joint Year 2000 Council strongly recommends that all countries develop a national strategy with respect to the Year 2000 problem. The Council expects that the establishment of coordinated national strategies will produce efficiencies and accelerate the action necessary to address the Year 2000 problem in the short amount of time that remains before the millennium change. In many countries meaningful initiatives are already being taken in various sectors. However, the seriousness of the potential consequences of failing to adequately meet the Year 2000 challenges and the complexity of developing solutions to avoid major disruptions clearly demands a more coordinated effort across key industries than is currently underway in most countries. One possibility for designing and implementing a national coordinated strategy is the creation of a national government body that would coordinate preparations for Year 2000 readiness across the key industries and infrastructure providers in its jurisdiction.

In many countries financial market authorities have already taken meaningful initiatives to raise the awareness of the Year 2000 problem and to encourage readiness of key components of the financial market infrastructure. Given the importance of financial markets to the economy it is clear that financial market regulators could make an important contribution to the coordination of Year 2000 strategies on a national basis. National governments can play an important role in promoting broad-based awareness at the most senior level of the private and public sector of the potential disruptive effects of the millennium date change; in ensuring that appropriate action is taken by all major institutions in the economy, including utilities; and in coordinating action taken by different industries in both the public and private sector, both domestically and internationally.

Based on the experience of a number of countries which have developed and implemented concerted national Year 2000 strategies, the following tasks could usefully be assigned to a national government coordinating body:

  • improving the awareness of the complexity of the Year 2000 challenges in both the private and the public sectors;
  • cooperating with relevant private sector organisations to ensure that proper action is taken in all sectors of the economy to achieve Year 2000 readiness by all users of information technology, both large and small;
  • paying particular attention to readiness efforts of major utility providers such as electricity companies, telecommunication companies and water suppliers;
  • establishing target dates for completing key phases of Year 2000 programmes appropriate for the industry and market;
  • evaluating the available human and financial resources to address the Year 2000 problem in key industries;
  • ensuring proper action by various government agencies to minimise possible disruptions relating to the millenium date change;
  • assessing the possible cross-border aspect of the Year 2000 problem and assisting in the international coordination of national strategies;
  • developing and implementing a communications strategy to increase public confidence as the millenium date change approaches;
  • assisting in the coordination of contingency planning in both the private and the public sector.

The Joint Year 2000 Council is engaged in various global Year 2000 initiatives which may be relevant to the development of national coordinated strategies. It is developing a global databank of contacts in individual countries covering government entities, financial market regulators, financial industry associations and infrastructures, utilities and other relevant institutions. The Council also intends to regularly publish policy papers on specific Year 2000 issues. It has recently released a document providing supervisory guidance on the independent assessment of financial institution Year 2000 preparations. Forthcoming papers will cover the scope and impact of the Year 2000 problem; the importance of testing for Year 2000 readiness; disclosure issues; and contingency arrangements.

The Council is engaged in an active dialogue with various international groupings in the private and public sector in order to share information and coordinate Year 2000 readiness efforts as much as possible. The Council welcomes the efforts by the World Bank to develop a framework for the design of national Year 2000 programmes and to assist countries in implementing it.


Note for editors:

The Joint Year 2000 Council is sponsored by the Basle Committee on Banking Supervision, the Committee on Payment and Settlement Systems, the International Association of Insurance Supervisors, and the International Organization of Securities Commissions. The Secretariat for the Council is provided by the Bank for International Settlements. Information on the Council's objectives and activities can be found at the BIS Web site (www.bis.org ). The G-7 Finance Ministers have welcomed the establishment of the Council and have recommended that it take any appropriate action to ensure worldwide attention to the Year 2000 challenge.