regional and bilateral level. in this spirit, the ecb has organised, together with several eurosystem national central banks, high - level meetings with central bank governors of the ten new eu member states and accession countries, and with latin american, mediterranean and east asian central banks. in previous meetings there has always been an extremely fruitful exchange of views, contributing to a better understanding of issues of common interest. our discussions at this seminar will reflect three developments that have had a strong impact on our bilateral relations over the past decade. there is first the integration of the russian economy into the global economy. closely related to this is the emergence of a europe without dividing lines. finally, there have been profound changes in the monetary and financial environment in our economic areas. let me briefly discuss each of them. the integration of the russian economy into the world economy more than twelve years ago the russian federation embarked on a road that would lead the country through the difficult transition from a centralised system to a market - driven economy, from a fully closed to an open society. it has been a bumpy road, but the ground that has been covered is impressive. indeed, since 1999 the russian federation has contributed substantially to global growth and has become a major holder of foreign exchange reserves. the russian federation ’ s share in global trade has been on the rise since 1998 and on international capital markets russian corporations have gained the status of key borrowers, benefiting from the country ’ s transition to investment grade status. against this background, our institutions are facing the same challenges in relation to developments in the international monetary and financial system. examples are the increasing degree of financial globalisation, including its implications for reforming the international financial architecture, and the conduct of policies in an environment characterised by large global imbalances. chairman ignatiev and his colleagues have been a pleasure to work with in this respect, as they have enriched discussions in the respective fora by providing their invaluable assessments and perspectives. the eu and the russian federation the russian federation ’ s integration into the world economy is most evident when looking at the development of economic and financial linkages to the eu. russia is our largest neighbour, and has been brought even closer thanks to enlargement. since 1999, exports to the russian federation have grown at double figure rates, and in 2002 it was the eu ’ s fifth largest trading partner. on the other hand, the enlarged eu accounts for more than 50 % of total russian trade. the russian federation

early in the crisis, emerging asian economies strengthened prudential regulation and supervision, together with bank governance and market transparency and discipline, in order to prevent further instability and bring domestic standards closer to the international norms. 5 furthermore, they generally acknowledged that their economic “ miracle ” before the crisis was not sustainable. it was driven by over - investment encouraged by colbertist policies, implicit government guarantees, and too often, opaqueness and political interference in market mechanisms. 6 as a result, at the macro level, growth was led by capital accumulation in the wrong sectors and not by a rise in total factor productivity. in paul krugman ’ s words, the asian miracle was “ the fruit of perspiration, not of inspiration ” 7. to address the root causes of the crisis, structural reforms aimed at improving governance and challenging vested interests, both in public policy - making and in the corporate sector, see frbsf economic letter ( 2011 ). “ could we have learned from the asian financial crisis of 1997 – 98? ”, february 2011. see lindgren, c. - j. et al. ( 1999 ). “ financial sector crisis and restructuring. lessons from asia ”, imf occasional paper, 188. see fukao, m. ( 2003 ). “ japan ’ s lost decade and its financial system ”, the world economy, 26, pp. 365 – 384, and caballero, r., t. hoshi and a. kashyap ( 2008 ). “ zombie lending and depressed restructuring in japan ”, american economic review, 98 : 5, pp. 1943 – 1977. see footnote 4. see krugman, p. ( 1999 ). “ what happened to asia? ”, in sato r. et al., global competition and integration, kluwer academic publishers, pp. 315 – 327. already in 1590 hong zicheng ’ s caigentan claimed that “ water that is clear has no fish. ” see krugman, p. ( 1994 ). “ the myth of asia ’ s miracle ”, foreign affairs, 73 : 6 ( 1994 : november / december ). bis central bankers ’ speeches were essential. 8 the lesson to be learnt was that sustainable growth can only be achieved by fostering an environment that encourages open markets, innovation and entrepreneurship. a third lesson is that re - nationalisation and protectionism are not the solution to a crisis indeed, there is empirical evidence