Mario Draghi: Response on receipt of an Honorary Doctorate from Tel Aviv University Speech by Mr Mario Draghi, President of the European Central Bank, on the receipt of an Honorary Doctorate from Tel Aviv University, Tel Aviv, 18 May 2017. * * * Ladies and gentlemen, It is my privilege to speak to you tonight, on behalf of all those whom you distinguished by awarding an honorary doctorate of the University of Tel Aviv. We come from different fields of human endeavour. Politics, policy, business, history and of course fundamental research. Our achievements are diverse. But they are all based on careful accumulation, experimentation and exploitation of knowledge. Knowledge created and fostered by universities such as yours. And I cannot but detect the profound influence of this search for knowledge in my memory of recent events. The eruption of the global financial crisis in 2008, and the subsequent sovereign debt crisis in Europe, caused a deep recession worldwide, a sharp increase in unemployment and exposed the incompleteness of some parts of the EU institutional architecture. Fertile conditions to give voice to populist and nationalistic rhetoric. But that period of crisis was also conducive to improving our understanding of economic and political forces, and to translating this new knowledge into action. The crisis has thus resulted in a form of creative destruction, where established paradigms have been critically revisited, where flawed practices have been exposed and replaced by sounder ones and where new research addressed previously neglected aspects of our societies.

Major events that could shape global growth in the near term include uncertainties in policy and political spheres, especially in major economies; the potential retreat arising from backlash against globalisation; the rise in trade protectionism; and the volatilities of global commodity prices. Financial markets have in recent months remained eerily calm. However volatility may 1/6  BIS central bankers' speeches  reignite if risks re-emerge, whether real or perceived. Beyond these short-term risks, structural changes are also afoot. The ageing population, income inequality and youth unemployment are slow-churning yet potent structural changes that require policy prescriptions. Changes in policy today are needed to secure future prospects for growth. In Malaysia, the economy has been boosted by the expansion in global demand. The strongest export growth in 28 quarters has provided additional impetus to our domestic demand. Consequently, the Malaysian economy started 2017 with a robust growth of 5.6% in the first quarter. We are on track for a better economic growth compared to last year. Nevertheless as an open economy with sizable and globally connected financial markets, Malaysia cannot neglect the risks dominating the global environment. We are certainly not immune from events unfolding around us. Some say central bankers are paid to worry. In good times and even more so, the bad. However I am comforted that earlier reforms have accorded the country with strong macroeconomic fundamentals and resilience to weather these still-challenging times. However, we cannot afford to rest on our laurels. New risks and challenges continue to emerge and confront us.