One possibility is to develop the G20 based on the IMF model where countries are represented through constituencies. Small  2  163/2009  countries like Norway, or at least the Nordic countries, could then be represented in a forum for discussion of the policies of major economies. In the wake of the Great Depression of the 1930s, protectionist measures were introduced in many countries. Customs duties were increased to shield domestic industry. As a result, world trade continued its decline over several years. So far, protectionist policies have been avoided in the wake of the latest crisis, which makes it possible to reverse the sharp contraction in world trade more rapidly and hence reinvigorate economic growth. One reason why the mistakes of the 1930s have not been repeated this time may be that the World Trade Organisation (WTO) was established in the interim. International trade agreements concluded under the auspices of the WTO contribute to binding national governments and prevent protectionist measures. By and large, this has worked well during the recent crisis. Could the crisis have been avoided? The macroeconomic forces that were unleashed in the years leading up to the financial crisis were strong. It is unlikely that a single country could have stemmed the tide. China’s participation in international trade in goods added several hundred million persons to the global workforce over a few years. This increased the room for strong, non-inflationary global growth. China was not prepared, however, to liberalise its capital markets fully.

I consider that a clear but, at the same time, flexible framework for macroprudential supervision will create the best conditions to counteract future financial crises. But this is not to say that this would be enough to ensure that no financial crisis ever occurs again. The crises of tomorrow will probably have completely different causes to the crises of yesterday, making them difficult to protect ourselves against. However, the scale of the costs of a financial crisis justify making every effort to protect ourselves. As regards the question of where responsibility for macroprudential policy ought to lie, it is clear that this area is closely linked to both the Riksbank’s and Finansinspektionen’s activities. The Riksbank has been analysing the stability of the financial system for fifteen years and also currently provides recommendations for safeguarding it in its Financial Stability Reports. Finansinspektionen also works for the stability of the financial system but with a focus on individual institutions. The competence and experience of both authorities will have to be utilised if macroprudential policy is to be effective in Sweden. While awaiting a more long-term solution for Swedish macroprudential supervision, the Riksbank and Finansinspektionen have set up a temporary council for cooperation. In addition to consulting and exchanging information on assessments of risks and possible countermeasures, one task of the council is to discuss the development of instruments and methods within macroprudential supervision. The joint communication of our assessments in connection with this council for cooperation is a benefit in itself.