petar chobanov : what to expect for banks and the economy in 2024 speech by mr petar chobanov, deputy governor of the bulgarian national bank, at the opening of the " banks and business " conference, organised by the capital newspaper, sofia, 5 december 2023. * * * first of all, i would like to thank the organisers from'capital'for inviting me to take part in today's conference, which over the past decade has established itself as an important event in the area of finance in bulgaria. the subjects on today's agenda are extremely important and highly topical in the field of banking services. the new year 2024 is a natural continuation of the macroeconomic and global processes that originated with the onset and spread of the covid - 19 pandemic. since 2020, we have been faced with a unique situation in the world economy, in which the dynamism of events is predetermined by a series of shock events. the pandemic caused by covid - 19 has created conditions for monetary and fiscal relaxation which made economic agents have unrealistic expectations, and also for inflation comparable with the oil price shocks of the 1970s. in early 2022, with the start of the military invasion in ukraine, the cumulating economic shocks intensified, exacerbating the supply chain issues in the global economy and creating pre - conditions for the outbreak of an energy and food crisis, and with recent developments in the middle east these conditions have the potential to escalate and grow into a much broader humanitarian crisis by its nature. turning to the national specifics in bulgaria, we are meeting the year 2024 confronted with the already mentioned external challenges, and at the same time it should be noted that it seems that one of the safeguards inherent to the economy, which would arise from the declaration and implementation of a clear and consistent fiscal conservatism, will be lacking. on the other hand, in national conditions, especially considering our future entry into the euro area, the most effective macroeconomic policy is precisely the synergistic interaction between monetary and fiscal policies, which is somehow underestimated and sent into the background, while a kind of priority is given to fiscal dominance. the bnb's position on the fisc has always tended towards moderate conservatism, combined with the precise setting and planning of budget buffers that have the potential to provide fiscal space in the realisation of significant economic risks. for

process is the number of the senior managing officers in the area of finance and banking who graduated in countries from the francophonian world. of the sixteen governors of the bulgarian national bank who managed it during the period from its foundation to the second world war, eight received their higher education in economics, political science and law in belgium, france and switzerland, or specialised there. in the same period, thirty - two people held at different times the position of minister of finance, of whom nineteen graduated or specialised in these countries. today, many bulgarians continue studying the french language and culture in our schools or receive their education in francophonian countries. they are part of the 175 - million french - speaking community and in addition to the common language they are part of a common culture, which extends to all spheres of our life. i am proud that part of these people work in the bulgarian national bank and contribute a lot to the success of our institution. the increased economic and financial interrelatedness and interdependence of the countries call for ever - greater co - ordination of the economic and financial policies of the individual governments. the establishment in the 90 - ies of the past century of the principles of free movement of goods and capital increased the interdependence of the financial systems across countries, so that financial stability is no longer a national but a global issue. the significant participation of foreign capital in the banking system of a country and the massive movement of capital, largely contributing to the formation of serious imbalances, changes significantly the understanding of systemic risk and the approaches to its assessment. the above process of interrelatedness of the banking systems of individual countries necessitated the adoption of new principles of surveillance over the banking sector, as well as analysis and control of the risks arising from the ever - increasing interrelatedness between the banking sector and the other segments of the financial market. the implementation of basel ii will pose a challenge to the entire financial community, while for the newly emerging economies this process will be a serious test since their banking systems are very much open. the discussion of the common supervisory framework also brings forward the question as to what extent the high rates of growth of credit for the private sector, globally, and in many of the dynamically developing countries, in particular, poses a risk to financial stability and how much supervisory policy could be used as a tool for solving this problem. the process of financial sector globalisation, which i already mentioned, raised for many