ABSTRACT
The combined presence of social and macroeconomic stability and an efficient resource allocation is generally recognised to promote economic growth. The strategies and instruments employed towards establishing these growth conditions have, however, changed over time. In recent years, the financial sector has been identified as a market-based, cost-effective facilitator of the efficient resource allocation. International donors have consequently displayed a growing interest in financial sector assistance and financial sector reforms. The pivotal role assigned to the financial sector can be attributed to the following five factors.
