Opening remarks at the closing ceremony of the Eurosystem
Jörg Asmussen:
Needs Analysis Project
Speech by Mr Jörg Asmussen, Member of the Executive Board of the European Central
Bank, at the closing ceremony of the Eurosystem Needs Analysis Project funded by the
European Union, Skopje, 10 July 2013.
* * *
Governor Bogov,
Ambassador Orav,
Ladies and Gentlemen,
It is a pleasure to be here in Skopje today to mark the close of a successful needs analysis
programme. I have just handed over the related report to my colleague, Governor Bogov.
This report lays down recommendations for changes to the central bank law and regulations,
processes and practices in order to prepare the National Bank of the Republic of Macedonia
(NBRM) for EU accession. I hope that this report will help in developing the central bank's
strategy going forward. In fact, we are confident it will, as we know that some of the
recommendations have already been successfully implemented. The report is the result of
the nine month programme and was produced by the ECB and national central bank
colleagues following an analysis of your current practices.
[The areas covered by the programme are accounting, banknotes, economic analysis and
research, human resources, information technology, internal audit, legal services, monetary
and exchange rate policy, payment systems and statistics.]
I would like to stress, however, that we could not have produced such a comprehensive
needs analysis report without the excellent cooperation and openness of NBRM staff.
Let me emphasise that the programme with the NBRM stands in the tradition of other
ECBcoordinated technical cooperation programmes with EU candidate and potential candidate
countries conducted over the past decade. Central banks of candidate and potential
candidate countries are privileged partners for our technical cooperation. It is in the interest
of all of us, that once a central bank joins the ESCB, and eventually the Eurosystem, it is
able to fully perform its function in the system.
The report is not the only tangible outcome of this programme. Throughout the whole project,
NBRM staff have met many colleagues from national central banks as well as the ECB. This
means that NBRM experts now have a network of colleagues to whom they can turn for
advice or to share information. Moreover, the information does not only flow in one direction.
European experts have also expanded their lists of contacts in the region. The benefit of
such programmes is that both parties gain in understanding and learn from each other.
As you can well imagine, the crisis in several euro area countries has absorbed much of our
energy and attention in the past years at the ECB and in the national central banks.
However, we remain committed to international cooperation, and in particular to technical
cooperation with central banks of EU candidate and potential candidate countries.
As regards the current crisis, let me briefly mention the two most relevant areas
policymakers need to focus on looking forward.
Structural reforms, financial repair and fiscal consolidation at the national level are key and
need to be pursued vigorously in the financially stressed euro area countries. There is simply
no viable alternative.
At the European level, further improving the institutional framework, the governance of the
euro area is of utmost importance.
While EMU needs to be complemented with elements of a stronger fiscal, economic and
political union, the most pressing need is to implement a comprehensive and effective
banking union.
We learnt the hard way how quickly and severely financial sector problems in one country
can spread to another. We also experienced the severity of negative feedback loops
between sovereigns and banks. National supervisors have been heavily challenged by
crossborder banking and financial activities. Ultimately, a monetary union with a single currency, a
single monetary policy and increasing financial integration cannot function properly if
financial stability policies (regulation, supervision and resolution) remain at the national level.
The setting up of a banking union with the Single Supervisory Mechanism (SSM) and the
single resolution mechanism (SRM) as core elements is therefore key and will enhance the
quality of supervision and the credibility of the system and remove the misalignment between
the institutional frameworks for monetary policy and financial stability.
Given the close economic and financial links between the euro area and south-eastern
Europe, it goes without saying that progress in addressing the crisis in the euro area is in the
interest of countries in this region. The SSM may bring particular benefits, as subsidiaries or
branches of euro area banks are of systemic importance in the financial systems of many
south-eastern European countries. In addition to enhancing the quality of supervision of
parent banks, the SSM has the potential to facilitate home-host country cooperation in
banking supervision.
I am confident that future new members of the EU, and eventually of the euro area, will
ultimately accede to a stronger Union. In this context, a key lesson from the crisis for EU
candidates and potential candidates is that membership of the EU and the euro area should
not be seen as an end in itself, but rather as a means to an end, namely to enhance the
welfare of our citizens. The achievement of sustainable convergence and competitiveness is
vital for the successful membership of the euro area.
To conclude I would like to thank our host Governor Bogov. As stated in the report of the
programme we are closing today, he has already brought the NBRM in line with or close to
European standards in many areas. I wish him every success in working on the remaining
issues and offer our services and support to this end wherever possible. I thank Ambassador
Orav and the European Union for funding this initiative and hope that, given the importance
of strong institutions, the EU also will support central bank cooperation with the NBRM in the
future. And finally I would like to thank my colleagues from the ECB and the national central
banks who are also represented here today for their efforts and contribution to this very
successful cooperation programme.