samchain/econo-pairs-v1 huggingface dataset:
During the past decade, Malta has registered one of the slowest  6  European Innovation Scoreboard 2009. Link available at: <>http://www.proinno-europe.eu/sites/default/files/page/10/03/I981-DG%20ENTR-Report%20EIS.pdf  7  Ernst & Young’s 2009 Malta Attractiveness Survey. 4  BIS Review 50/2010  average annual export growth rates in volume terms in the EU. Survey information from micro and small enterprises reveals that the most frequently cited obstacles to exporting relate to taxation issues in foreign markets, inadequate market intelligence and insufficient capital. 8 Recent initiatives and the way forward This suggests the need for a comprehensive strategy to help these small enterprises exploit the opportunities offered by the EU Single Market, building on the existing public and private initiatives. The Budget for 2010, for example, included measures aimed specifically at easing some of the constraints I have just referred to. Chief among these is a 40% tax credit scheme, which is directed at micro enterprises that invest in productive processes or create more jobs. Meanwhile Malta Enterprise is playing an active role in assisting small businesses to tap EU regional funds. It has been recently reported that applications for grants from the European Regional Development Fund (ERDF), from which EUR 20 million for industry and EUR 10 million for investment in renewable energy are available, have led to the selection of almost 400 projects with a proposed outlay of EUR 25 million. An additional EUR 7 million, announced in the Budget for 2010, is also being made available.

Economic activity is therefore expected to remain sluggish and uneven in 2010, with GDP expanding by less than 1.0% in both the euro area and the United Kingdom. 4 Mirroring these expected trends abroad, the Central Bank of Malta’s projections point to a modest GDP growth rate of around 1.0% in 2010. Net exports are likely to contribute negatively to growth, so that the main growth impulse is expected to come from domestic demand, driven by higher investment outlays on infrastructure projects and, to a lesser extent, by a moderate expansion in private consumption. Labour market conditions are unlikely to improve this year, with the unemployment rate remaining above 7%. This subdued growth outlook, together with the expectation that inflation will remain more elevated than in the euro area, will exert downward pressure on disposable income. Overall, therefore, the economic environment facing small businesses in the foreseeable future, both domestically and in our main trading partners, will be less favourable than that which prevailed before the onset of the financial crisis in 2007. 4  2  European Commission Interim Forecasts, February 2010. BIS Review 50/2010  Small businesses access to finance Since SMEs and micro enterprises are typically more dependent on bank financing than larger firms, the ongoing deleveraging of bank balance sheets in many EU countries represents a potential threat. The prospect of a prolonged period of restricted access to both working and investment capital at a time of subdued demand could result in the closure of many enterprises.
Norges Bank’s main functions The current Norges Bank Act establishes that Norges Bank is Norway’s central bank and describes the Bank’s functions and its role as executive and advisory body for monetary, credit and foreign exchange policy. The functions described are in line with the customary functions of a central bank and follow from the Bank’s key role in financial markets. But there is little in the current Act to indicate which long-term objectives the Bank should pursue. The Commission wants to change this. The Commission proposes the introduction of an objects clause that clearly defines the Bank’s purpose. Norges Bank supports this proposal. At the same time, the Bank would emphasise that the interpretation of the objects clause must reflect the central bank’s different degree of influence over the various objectives. The central bank’s toolbox is limited, and for some objectives, the instruments available to other institutions may be more important for the result. Chart: Section 1-2 Norges Bank’s purpose – the Commission’s proposal The proposed objects clause contains two paragraphs. The first paragraph reads: “the purpose of Norges Bank is to maintain monetary stability and promote the stability of the financial system and an efficient and secure payment system”, while the second paragraph reads: “the Bank shall otherwise contribute to high and stable output and employment”. A well-functioning monetary system is a fundamental prerequisite for the efficient functioning of an economy. Norges Bank plays a key role in this context.

No matter how the Commission’s concrete proposals are followed up, I am confident that Norges Bank will continue to be a useful public institution. 7/8  BIS central bankers' speeches  1 Official Norwegian Reports 2017:13. New central bank act. Organisation of Norges Bank and the Government  Pension Fund Global. 8/8  BIS central bankers' speeches
Banks and investors will not necessarily take into account the overall risk in the financial system. The consequences came into clear evidence during the financial crisis: banks had inadequate equity capital, excessive short-term wholesale funding and insufficient buffers of highly liquid assets. A new and tighter international regulatory framework is intended to remedy this situation. Stricter capital adequacy and liquidity coverage standards are in the offing. The authorities will also be able to tailor banks’ capital requirements to the overall risk in the financial system. During upturns, these requirements can be raised, so that banks will have to hold more capital for their loans. This will smooth out lending growth and better equip banks to bear losses during downturns. It will ease the impact of the marching steps on the bridge. There will be a need for higher capital buffers when economic growth is solid and debt builds up. This may restrain the build-up of imbalances. But when there are no clouds on the horizon, it is easy to lose sight of more long-term considerations. The government authorities should therefore provide a clear mandate that ensures independence and delegates the responsibility for determining capital buffers. In this regard, we can build on the experience with the framework for monetary policy. And any change in capital requirements must be made on the basis of an assessment of the overall risk in the financial system – not only in a single institution.

These kinds of externalities are similar to those studied in the cluster theory that has successfully been applied to explain the geographic location of economic activities, the field of economics for which Paul Krugman received this year’s Nobel Prize in economics. It used to be common knowledge that the potential for productivity growth was highest in the manufacturing sector of the economy. This is no longer the case. Over the past decades, we have seen substantial productivity growth in the service sector. Since 1990, productivity growth in the Norwegian financial sector has been around twice that of the total economy including the manufacturing sector. In 1988 banks in Norway employed around 33 000 people, had 2200 branches and processed just under 400 million payment transactions. Today banks in Norway employ around 20 000 people, have 1260 physical branches and carry out around 1.6 billion transactions. However, the development of payment instruments and services are not “just” technical developments; they also pose some real challenges to us economists. For central banks, it is important that our payment system policies are founded on sound economic theory and research. An event such as this conference is thus important for Norges Bank and other central banks that wish to promote the use of efficient payment services. As mentioned, safe payment systems should continue to serve the markets even in periods of market turbulence. In my opinion, most large-value payment systems have operated very reliably in the ongoing financial situation.
6  Last year, Svein Gjedrem quoted Willem F. Duisenberg:  “Transparency in monetary policymaking should be understood as the extent to which the external presentation of the decisions corresponds to the internal decision-making process.” The following quote from a report written in 2001 by five internationally known economists (A. Blinder, C. Goodhart, P. Hildebrand, D. Lipton and C. Wyplosz) may provide a good supplement to Duisberg’s words: “…transparency should allow the public to understand, and possibly anticipate, the central bank’s decisions, to see each of them as the logical conclusion of a chain of past and future decisions aimed 7 at a clear set of targets,…. We in Norges Bank wish to be credible so that in retrospect our actions are understood and appear to be logical in relation to the inflation target. 5  Frøyland, Espen and Ingunn Lønning (2000): “The significance of uncertainty in monetary policy”, Economic Bulletin 4/2000, Norges Bank. 6  Duisenberg, Willem F. (2000): “Making monetary policy in a broad monetary union”, BIS Review 8/2000. 7  Blinder. A., C. Goodhart, P. Hildebrand, D. Lipton, C. Wyplosc (2001): “How do central banks talk?” Geneva Report on the World Economy no. 3, May 2001. BIS Review 7/2002  5  The Executive Board assesses economic developments and the outlook for the economy to the best of their judgement. However, our assessments may deviate from the assessments of others. Many factors are evaluated before an interest rate decision is made.

In mid-2007, serious problems with structured products backed by sub-prime mortgages put an abrupt stop to the boom in securitisation. False incentives, inadequate control mechanisms, shortcomings in the rating system and insufficient personal responsibility on the part of investors were the main criticisms aimed at securitisation practices. What is important now, is to correct these deficiencies, so that the trust of market participants in these products can be restored. It would be wrong to ban the securitisation of mortgages, since these refinancing instruments generate substantial economic benefit and are an indispensable part of our modern financial system. The mortgage securitisation weaknesses revealed in the financial market crisis do not apply in the case of the Swiss mortgage bond. Consequently, it should definitely have the potential to play an even greater role in maturity-matched refinancing of mortgages in Switzerland in the future. In addition, banks can improve their liquidity by holding portfolios of Swiss mortgage bonds themselves. Mortgage bonds could be converted into liquidity quickly and simply, as required, by means of repo transactions – either in the Swiss franc interbank market or at the SNB. BIS Review 60/2008  1
For these reasons, I see no extra cost associated with the fiscal and monetary policies that are consistent with progress towards monetary union. BIS Review 63/1997  -9-  The question of the costs associated with the launching of the ECB and the ESCB is also important. The question arises only to the extent that the ECB is supposed to start from scratch and has to build credibility on its own. But it is certainly not the spirit nor the letter of the Maastricht Treaty; it is certainly not the very nature of the monetary concept of the single currency. The single currency is neither supposed to start from scratch, nor to result from the averaging of the various currencies that exist within the European Union. It must clearly and it will according to the convergence concept, have the legacy of the most credible and solid currencies participating in the ERM mechanism. The euro, in any case, must be as solid and credible as are the most credible currencies in Europe. * * * In conclusion, I would like to make three points - Firstly, it is not only monetary union that we are preparing actively, but also economic union, i.e. political union in the economic field. We should not forget that the Treaty itself provides for a higher degree of political union than is usually acknowledged, with the concept of coordination of economic policies and the provisions for fiscal discipline and sanctions. The stability and growth pact grants important powers to the Council - i.e.

the Council of national Governments which is the equivalent in Europe of a federal government in a political federation. - Secondly, one should not underestimate the degree of monetary stability already achieved by European countries. Monetary stability is not only a project for the future, it is already a major achievement in many European countries. For example, seven countries have been participating in the ERM without any change in their central parities for more than ten years. - Thirdly, it is a false perception to view the necessary fiscal consolidation and monetary stability as constraints imposed by the Maastricht Treaty against the very interests of European countries. We would be implementing the same economic policies if there were no Maastricht Treaty, since they are based on some principles of sound economic management which are necessary to create jobs and tackle the problem of unemployment. Finally, economic and monetary union and the creation of the euro will crown economic and monetary cooperation between European countries, notably France and Germany which are the two pillars of it, and will foster prosperity, stability and peace in the European Union. BIS Review 63/1997
This reflected the incomplete nature of financial integration prior to the crisis – based largely based on short-term debt – and in turn unwound the channels for potential risk sharing within the euro area. A study on risk sharing published in 2008 had found that “monetary union has facilitated risk sharing, although the level of risk sharing is still much below the level found among U.S. states”.13 However, a study using a similar methodology in 2013 found that risk sharing through capital markets had virtually collapsed during the crisis.14 With external financing drying up, the catching-up economies faced the risk of a “sudden stop”. They therefore had to pursue both fiscal and structural policies aimed at achieving an internal devaluation so as to restore external balance. And they have been rather successful: since 2009 Greece has almost entirely reversed the ULC growth it experienced in the precrisis period, while good progress has also been made in Spain, Ireland and to a lesser extent Portugal. All the catching-up economies have also experienced remarkable improvements in their current accounts15, ranging from an almost 11 percentage points of GDP correction in Spain to a 16 percentage points of GDP improvement in Greece. However, while internal devaluation may improve the sustainability of the external position, it does not in itself produce sustainable convergence. Indeed, there is a risk that, if unit labour costs (ULC) adjust mainly due to falling wages and the current account closes, policymakers may lack incentives to address the underlying productivity problem.

Indeed, one criticism we could perhaps make of Optimal Currency Area theory is that is does not take account of the financial instability that may arise when capital reallocates across regions, both in terms of inflows and outflows. Banking Union goes some way towards redressing this, which is why it is essential for the longer term stability of the euro area. In terms of improving incentives, the Single Supervisory Mechanism (SSM) should in principle be better placed to prevent credit misallocation as supervision will be decoupled from national economic conditions. The shift towards bail-in ability under the new EU resolution framework should also, over time, increase the quality of scrutiny over allocation decisions by shareholders and creditors. And by removing supervisory barriers to retail banking integration, the SSM should provide the pre-conditions for greater foreign entry into national banking markets, which research suggests could improve capital allocation by increasing the distance between the main shareholders and management of a bank and the vested interests in the country where the bank operates.21 These same factors also provide stronger channels for risk-sharing within the euro area. A more integrated retail banking market would imply that losses from local banking crises would be shared across multiple jurisdictions, thus acting as a shock absorber as we see, for example, in the United States.
At our last monetary policy meeting, we upheld the assessment that inflation will converge to levels that are below, but close to, 2% over the medium term. Wages are picking up at a pace that is more or less in line with expectations from our models. One thing that has not worked out as expected is the transmission to consumer prices. This pass-through is not working in line with projections. We are analysing this very carefully. But we remain confident that it will eventually do so; we need to be patient and persistent. But what if the economic outlook deteriorates further and more permanently? In our baseline scenario, capacity utilisation will remain high and firms will be in a position to pass higher wages through to higher prices. That would be more difficult if growth remained below potential. Downside risks to growth could then lead to downside risks to inflation in the medium term. We are not at that stage yet, but this will be an important discussion point at the next meetings of the ECB’s Governing Council. But if the outlook becomes gloomier, what will happen then? Will the ECB’s Governing Council be even more careful in continuing on its cautious path towards monetary policy normalisation or could there be another turn towards more easing? I have never spoken about a normalisation of our monetary policy stance. I have always referred to a normalisation of our instruments. There is a big difference.

In our efforts to achieve the desired outcomes, we are cognizant of the need for our leaders at all levels of the organisation to demonstrate the right behaviours to reinforce our desired culture of trust, integrity, collaboration and innovation. When speaking about leadership here, I should add that this is not defined by one’s position, but rather the values that one upholds in doing what is right and in the best interest of the organisation. Times have changed, and a job for life is no longer the goal to aspire to in a career. Rather, our job is now to be life-long learners, and to facilitate that same learning for others. A continuous learning mind-set is what will ultimately differentiate an outstanding career from a mediocre one, and ensure that we can adapt, thrive and be productively and purposefully employed whatever unfolds in the future of work. I hope that as CEOs, CLOs, Heads of L&D and academia, we will be the agents of change to help steer our organisations towards a work environment and culture that will survive and thrive amid the future challenges to come. Today’s event is a step in that direction. Let us learn from distinguished experts and one another today. Let us reimagine organisational learning. Most of all, let us strive together to build a strong, competent and well-rounded workforce. Thank you and I wish all of you a productive and stimulating day ahead. 1 The Future of Jobs Report 2020 by the World Economic Forum 2 OECD (2019).
The adjustment of unit labour costs is being achieved primarily thanks to the high productivity  2  BIS central bankers’ speeches  gains brought about by job destruction, while the easing in inflation has corrected to a lesser extent the gap built up during the upturn. This behaviour highlights the slow and imperfect functioning of the competitiveness channel, which should in principle lead to a containment of prices and costs in those economies that accumulate bigger external misalignments. Indeed, achieving lasting improvements in competitiveness requires greater cost and price adjustments and productivity gains associated with genuine improvements in productive efficiency. However, since 2007 the Spanish economy’s external deficit has been substantially corrected, dipping from 10% of GDP in 2007 to 3.4% of GDP in 2011. Underpinning this narrowing of the deficit has been the buoyancy of exports and the sluggishness of imports, in step with the weakness of domestic demand. Notwithstanding, the culmination of this adjustment is conditional upon certain elements such as the deficit on the energy balance and the magnitude of the investment income payments component, with a negative balance equivalent to 2.7% of GDP in 2011, which is very closely related to the high level of the International Investment Position. These factors all accentuate the importance of those reforms contributing to correcting the deficit through the boosting of sustainable competitive gains in the medium and long term.

Since 2009, the measures in this area have adhered to a set of common principles, although changes in economic conditions and in the markets have meant governments have had to adjust them. These principles include most notably to limit as far as possible use of public funds and to minimise the length of time the State has a stake in the banks; to promote integration and restructuring processes to counter the excessive fragmentation and size of the sector; to pursue the clean-up of bank balance sheets to withstand asset quality impairment; to reinforce bank solvency; to resolve the structural weaknesses of the savings bank model, and to promote transparency. Among the measures adopted in 2011 to which the Annual Report refers is Royal Decree-Law (RDL) 2/2011 on the strengthening of the financial system. This legislation raised core capital requirements to 8% generally, and to 10% for unlisted banks with a high dependence on wholesale funding, which were those on which doubts were greatest. To ensure that all banks could meet these requirements, it was decided that the Fund for the Orderly Restructuring of the Banking Sector (FROB) should act as a backstop. Further, the RDL stipulated the obligation for those institutions requiring public aid to operate as banks, with the aim of reinforcing their fund-raising capacity, and transparency towards investors. These measures, along with pension reform, contributed most positively to the easing of market tensions witnessed in the first half of 2011, with the risk premium falling at one point below 200 bp.