samchain/econo-pairs-v1 huggingface dataset:
Leszek Balcerowicz: The optimal timing and path for Poland’s entry into EMU Speech by Prof Leszek Balcerowicz, President of the National Bank of Poland, at the 11th European Banking Congress in Frankfurt, 23 November 2001. *  *  *  Thank you very much Mr Chairman, I welcome this opportunity to address such a distinguished audience. I would start with two basic assumptions. First, we are not discussing whether euro will go east or not because we are assuming Poland and other candidate countries will enter the European Union with the status of a country with derogation, so sooner or later they will be obliged to join the Monetary Union as well. Therefore, the issue under discussion is not “if” but “when” and “how” i.e. what are the optimal timing and the optimal path. Secondly, one should assume equal treatment of candidates and present EU member countries i.e. fulfilling the Maastrich Criteria, no less no more. There should be no additional criteria like, for example, a required level of financial deepening, as it would indicate an unequal treatment of candidate countries. Taking the second assumption of the entry into the EMU as granted, I would like to focus on the core issue, which is the question of optimal timing. My basic point is, that, firstly, early entry into the Monetary Union is possible and secondly, that it is preferable to the delayed one.

The recent financial crisis has also revealed the failure to understand the inter-relationship between financial and the broader sector, particularly in understanding the potential spill-over and second-round effects that are transmitted between sectors. Post-crisis regulatory efforts have focused on macro-prudential measures to complement micro-surveillance and supervision. This entails horizontal assessment of risks across institutions, sectors and national borders, as well as risks in asset markets across time. This is particularly relevant for the Islamic financial services sector. Given the close ties of Islamic finance with the real economic sector through the various modes of Islamic financing contracts, a complete understanding of the entire risk spectrum often encounters much difficulties. It is therefore important for the regulators to also establish an integrated framework of macro surveillance for Islamic financial activities across jurisdictions. The global database for prudential Islamic finance statistics to be initiated by the IFSB, would therefore need to go far beyond ensuring standardised data collection among jurisdictions, but also to enable the generation of various macro and financial indicators, and global sharing of best practices in macro surveillance. The engagement by supervisors would also contribute towards the understanding of the systemic risk and its origins and would support the maintenance of timely and accurate economic and financial data. This would in turn contribute towards more effective surveillance and management of financial stability issues.
Presentation of the Annual Report of the Autorité de contrôle prudentiel et de résolution (ACPR) for 2022 Press conference, Wednesday 31 May 2023  Speech by François Villeroy de Galhau, Governor of the Banque de France Chairman of the ACPR  Page 1 of 9 Ladies and Gentlemen, I am pleased to welcome you to our yearly presentation of the Annual Report of the Autorité de contrôle prudentiel et de résolution (ACPR – Prudential Supervision and Resolution Authority), in the company of Jean-Paul Faugère, Vice-Chairman of the ACPR, Alain Ménéménis, President of the Sanctions Committee, and Nathalie Aufauvre, Secretary General of the ACPR since January 2023. The events of 2022 and the beginning of 2023 have raised significant challenges, but also two valuable confirmations: that of the soundness of the French banking and insurance sector (I), and that of the European model of regulation and supervision (II). We nevertheless need to take reinforcement actions in the short and medium term (III). I. Major challenges that confirm the robustness of our financial system... 2022 will naturally remain the year when Russia invaded Ukraine. Geopolitical uncertainty spread to the financial sector, notably with the sharp rise in commodity prices and margin calls on their derivatives. This was compounded by other sources of volatility, in particular on the UK's sovereign debt, and the collapse of a number of crypto-assets.

As regards housing loans, fixed rate loans - which fortunately represent almost 98% of outstanding loans -  Page 3 of 9 are an essential protection for borrowers, and therefore ultimately for the banks as they limit their default risks. And more generally, rest assured that we will never take any prudential decision that could increase the risk of overindebtedness or of non-repayment of housing loans. The average solvency ratio of the six main French banking groups reached 14.9% at end-2022, still a high level, well above regulatory requirementsi. I welcome the publication yesterday of the report by the Observatoire du financement des entreprises ii, which notes that for this very reason, their access to financing has remained favourable despite the crises. French insurance groups also show high solvency ratios, around 250%, thanks to their dynamic activity and financial results. Page 4 of 9  II. ... and of our regulation and supervision model There are two other reasons why the US banking crises did not affect the euro area this time - although we must remain vigilant: our regulation and supervision. As regards regulation, Basel III in its entirety applies to all European banks, but only to 13 banks in the United States.
At the same time, labour shortages have persisted in many sectors and overt unemployment has been stable and low. The business sector must restructure rapidly when real wages increase sharply. Many activities will no longer be profitable and will be shut down. This could lead to higher unemployment. However, lower employment will not necessarily be reflected in unemployment figures. We may instead see a flow of discouraged workers into, for example, disability pensions, early retirement schemes or different types of adjustment packages. The extent to which these schemes are used will depend on financial incentives and entitlement thresholds. 8  BIS Review 20/2002  In Norway, the employment rate is among the highest in the OECD area. This reflects both high labour force participation and low unemployment. The picture becomes more mixed when average working hours are taken into account. The average is lower in Norway than in other countries. The sickness absence rate is high. Part-time employment is widespread. The average number of person-hours worked in the working-age population is relatively low, despite high labour force participation and low unemployment. Among OECD countries, the only countries with lower figures than Norway are those with very high unemployment. In Norway, average working hours have fallen by more than 20 per cent in the last thirty years. This can be partly explained by the way working life and child care are organised, but similar trends are also seen in many other countries, especially in Scandinavia.

In Norway, credit and capital markets nevertheless feature some weaknesses, with thin securities markets and a narrow investor and ownership base compared with other countries. The reasons, and hence the solutions, can probably be found in the structure of the taxation of dwellings, property and financial assets, in a high level of state ownership of enterprises and in the organisation of pension saving in Norway. Investing even more government capital in Norway would reduce the return on investments in the Norwegian business sector and prompt other investors to invest elsewhere. Allocating even more capital to the Norwegian economy would probably lead to a rapid relocation of jobs to other countries, as the krone would tend to appreciate. Effects on industry structure The planned use of petroleum revenues will increase demand for public and private services. The guidelines imply an increase in the use of petroleum revenues over the central government budget of around 3½ per cent of mainland GDP by 2010. This may add 2½ -3 per cent of total employment in the service sector. As long as there are labour shortages in Norway, a comparable decline in manufacturing employment is likely to occur. Although the phasing in of petroleum revenues is a gradual process, the contest for labour resources will intensify. As a result, monetary policy is likely to remain fairly tight in the years ahead. A high interest rate level may in periods result in a strong krone. This may accelerate the scaling back of manufacturing industry.
Increased investment in computers, software, peripheral equipment, network infrastructure and other information and communication technologies are generally regarded as the most salient driving force behind what has been perceived as a new pattern of growth. Second, the New Economy is seen as being closely associated with the processes of deregulation, particularly in labour markets and network industries such as telecommunications, and globalisation, particularly in financial markets. Other accompanying conditions, such as increased competition and flexibility in domestic goods and factor markets, as well as a stable macroeconomic environment, are also indispensable components of the same picture, if not equally powerful determinants of the phenomenon. They allow the full potential of technological innovation to be exploited and ensure that a faster pace of economic expansion and employment can be achieved on a more sustained basis and without destabilising inflationary pressures. The ECB cannot, however, "create" a New Economy through its monetary policy. The New Economy depends mainly on technological progress and the liberalisation of markets. However, the ECB can provide a positive contribution to growth and employment prospects by safeguarding price stability. Maintaining price stability is the ECB's primary objective. Unfortunately, this is sometimes forgotten. In the long run, pursuing this objective will help the economy to enhance its growth potential. In this context, the Governing Council of the ECB, at its meeting last Thursday, confirmed the "wait and see" position with regard to the monetary policy stance.

Without that sense of group interest, we could not have cut employer CPF rates, nor restored our competitiveness in a way that few other countries could do. This collective response continues to be critical. In our current remaking, the key changes are in our mindsets, and the main driver of change is private initiative and enterprise. To succeed, the change must come from the people themselves. In this process, the government can only play an encouraging and facilitating role. The additional challenge for us is that this time, the motivation for remaking ourselves is less obvious. Previously we were catching up from behind, but now we are at developed country standards of living. Why do we need to sacrifice what we already enjoy? Yet if we do not accept the sacrifices and change, not only will we not make progress, but we will even likely lose what we already have. No union leader who has visited Shanghai doubts this. It is the reality that we must get home to every Singaporean. Social consensus and political will Fourth, reform and restructuring is never a purely economic exercise. Success depends critically on social and political factors. Economic reforms are not painless. There will be winners and losers, at least in the short-term. Therefore there must be political support for the changes, a willingness to accept the pain of the transition, and a confidence that those adversely affected will be helped. This depends on a feeling of shared nationhood, of going through thick and thin together.
In the central government budget for 2003, the allocations for the purchase of goods and services and for transfers show underlying growth of 4.6 per cent and estimated real growth of 0.5 per cent. The effect of the draft budget on demand is estimated to be mildly positive. The central government budget includes a proposal to increase the use of petroleum revenues by NOK 2 billion in real terms in 2003. The structural deficit in 2002 appears to be higher than was assumed this spring. The projections for the use of petroleum revenues up to 2010 have been revised downwards considerably since the Long-Term Programme, the National Budget for 2002 and the Revised National Budget for 2002 were presented. The krone has appreciated considerably since summer 2000. There may be several reasons for this. Relationships in the foreign exchange market are unstable. There are still several fundamental forces that influence the krone. One is purchasing power parity, another the phasing in of petroleum revenues and a third is cyclical developments in Norway and other countries. Moreover, the krone can be influenced by a shift in wage formation, and the krone can also be affected by external factors. A fundamental driving force is purchasing power parity. Prices in Norway relative to prices in other countries, measured in a common currency, have remained fairly stable over time. Purchasing power parity can be illustrated by movements in the relationship between the Norwegian krone and the German mark in the last 30 years of the mark's life as a currency.

The rise in the consumer price index adjusted for taxes and excluding energy products (CPI-ATE) is projected to moderate, approaching 1¾ per cent next summer. At the end of 2004, inflation is projected at 2½ per cent. The projections for inflation have been revised downwards from the June Inflation Report, as a result of a higher interest rate and a stronger krone. The projections for growth among trading partners have been revised down. We have assumed higher oil prices in light of recent developments. Against this background, the uncertainty surrounding oil prices and global growth is considered to be balanced. Production and demand growth in Norway are projected to be lower and unemployment higher than in the June Inflation Report. We consider the uncertainty surrounding the projections for the Norwegian economy to be balanced. Interest rates were left unchanged at Norges Bank's Executive Board meeting on 30 October. The sight deposit rate therefore remains at 7 per cent. According to Norges Bank's assessment, with an unchanged interest rate, the probability that inflation two years ahead would be higher than 2½ per cent was the same as the probability that it would be lower. BIS Review 65/2002  3  A time horizon of two years when setting interest rates allows monetary policy to contribute to stabilising production. This horizon prevents monetary policy in itself from causing unnecessary fluctuations in the economy. Alternatively, we could have sought to sustain the level of inflation at 2½ per cent six months to a year ahead.
The Objective of the FPC The UK government has proposed that the FPC’s main responsibility should be taking action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the UK financial system (my emphasis). “Systemic risk” is defined to embrace both faultlines in the structure of the financial system, ie the way its components are joined up; and cyclical threats from unsustainable levels of leverage, debt or credit growth. Two glosses on that are warranted. First, the government’s plan does not entail the FPC being held accountable for fine tuning the credit cycle, but rather for ensuring stability by maintaining the resilience of the financial system. An example might help. Say that in the face of a credit boom, the FPC raised banks’ capital requirements. That might help to slow the boom, and it would be helpful if it did so. But even if the boom continued, by virtue of having higher capital ratios the banking system should be more resilient when the bubble burst. If those FPC actions prevented the banks going bust, the downswing in the credit cycle, and so in the business cycle, would be less severe because the flow of credit services could be sustained. That would be a success. Perhaps not always a glorious success, but a whole lot better than where we are right now.

But now that we have passed the worst phase of that crisis, a reassessment of policy is needed. I have been arguing for some time that we should be gradually removing some of the monetary stimulus provided in the depths of the recession by raising interest rates to reflect the improvement in the economy at home and abroad and to counter the rather worrying tendency of inflation to run significantly above the 2% target set by the government. In recent months, however, there have been concerns about the sustainability of the UK economic recovery which might seem to weaken this case for higher interest rates. The GDP data for the final quarter of last year were disappointing, even allowing for the impact of the snow, and there are worries about the impact of fiscal tightening as it begins to have an impact through public spending restraint and higher VAT. There are also concerns about volatility on the international scene, with political instability in the Middle East and North Africa and the effects of the earthquake and tsunami on Japan, the world’s third largest economy. In today’s speech I want to discuss the growth of the UK economy over the current recovery and how it should be reflected in the MPC’s decisions on monetary policy.
We see opportunities at each of the three stages of the supervisory process: 1. Rule-setting and reporting;  2. Analysis and monitoring; and  3. Setting and communicating a supervisory strategy to mitigate identified risks. Consider rule setting and reporting compliance. At over 638,000 words, the PRA Rule Book is longer than War and Peace. It is also somewhat less interesting and infinitely more complex. We are currently using advanced analytics to understand that complexity and to simplify our rules in order to make compliance with them easier and less expensive. An even bigger opportunity lies in the Bank re-thinking completely how we collect, store and analyse data. We cannot do this in isolation but will engage with industry to explore a range of options. Our vision is that the Bank could be able to “pull the data on demand” from firms rather than “sit back and wait to receive data” from them. With the right API, Web Portal or Platform, manual interventions could become obsolete, making the process quicker, more efficient and hugely less expensive. It would free up resources for firms to focus on delivering a better service to their customers, and it could discipline us to take only the data that we need to use and have the capacity to review. 25  “McKinsey & Company research for the Future of Finance review”.

It is this estimate that underlies the plan drawn up by the Government and the Storting, referred to as the fiscal rule. The rule states that the Government is to spend, as an annual average through the business cycle, the expected return on the petroleum fund i.e. 4 per cent. Because of the high level of activity, the Government has proposed somewhat lower petroleum revenue spending next year than the 4 per cent of the Fund’s value at the beginning of the year. The proposed tax programme for next year will have a fairly neutral impact on economic activity. Proposed direct and indirect tax rates will generate approximately the same government revenues as last year’s tax rates had they been left unchanged. However, the overall central government budget will have a stimulatory effect. This is reflected in fairly strong nominal spending, which is higher than the rate of growth in mainland GDP that can normally be expected. Norges Bank’s interest rate setting is based on two main criteria for future interest rate developments. First, the interest rate is set with a view to stabilising inflation close to the target in the medium term. The horizon will depend on the shocks to which the economy is exposed and their effects on the path for inflation and the real economy ahead. Second, the interest rate path shall provide a reasonable balance between the path for inflation and the path for capacity utilisation.
However the impact on the economy remains positive, as outsourcing and off-shoring allow companies to increase their competitiveness and lift the sales – inter alia, due to the fact that foreign branches to a large degree serve the local markets – which, in turn, requires a higher employment level in head offices and a higher number of well-qualified people at home. 20 Moreover, the fear of off-shoring increases the investment of employees in human capital, which results in better performance and flexibility of the labour market. 21 Therefore, the ability to change and improve qualifications as well as to assess which sectors in Poland have the potential and which are on the decline due to their inability to face the global competition, is gaining on significance. We should also assess what impact globalization has on company strategies. If multi-sourcing strategies are to be more and more widely applied, the question arises how Polish enterprises should operate on that market. The question whether a long-term employment relationship in a large organisation is better than the one of self-organizing cooperating nets of small companies or even persons, which proved well in the manufacturing of motorbikes and textiles in China, and some software, still remains unanswered. Last but not least, we should consider how Polish companies and their employees should develop their most precious assets in the homo sapiens globalus society i.e. the intellectual capital. I am just making a remark of these extremely important topics. Conclusions The recently published report by Edward Bendyk, “Przyszłość pracy.

8 The emergence of homo sapiens globalus i.e. the global labour market Further in my speech, I would like to present two main global forces that will drive the emergence of the homo sapiens globalus: -  economic migration, i.e. relocation of people in search for better-paid jobs and better living standards;  -  outsourcing and off-shoring, i.e. relocation of workplaces in search of less costly or better qualified workforce to lower the production costs, increase the product and service quality, mitigate the risk, and boost innovation. People relocate in search for work – economic migration One of the strongest motivations behind migration is the difference in wages, or – more broadly – in the living standards between countries. Such differences have existed for many years, as is the case with migration. It may be expected, however, that the emergence of the global labour market coupled with the aforesaid demographical trends and the decrease in the cost of transport will lead to increased economic migration, including migration from poor countries and regions to the rich ones. According to UN estimates, in the period 1970 - 1980 the number of immigrants to the developed countries increased by 2.4%, in the period 1982 - 1990 by 2.9%, and in the period 1990 - 2000 by 3.1%. Migration adds to the value of the global income.