goals and which allow family background to dictate life choices. in eliminating vested interests in a non - competitive system, structural reforms are more than just a tool for growth creation. by encouraging everyone to be involved in the process of production, they ensure that the drive for a more equal income allocation is not the task of state - led redistribution alone. in this way, reforms aim to harness individual potential to the growth of the economy. nevertheless, looking to the not - too - distant future, national virtues – while indispensable for strengthening solidarity among member states along the way – won ’ t be enough to make europe a goal all its citizens can consider their own. bis central bankers ’ speeches it will also be necessary to introduce reforms that further reduce the barriers between individual member states, in particular to the development of a single european labour market, and that affirm the principle of solidarity, as proposed recently in the “ four presidents ’ report ”. 3 to build, with passion and vigour, a shared future in which the conditions for growth are more favourable, in which all citizens feel that their skills are fully valued, in which individual wellbeing goes hand in hand with collective well - being. we are all working today, each within our own mandate, to achieve that goal. thank you for your attention. herman van rompuy ( in collaboration with jose manuel barroso, jean - claude juncker and mario draghi ), “ towards a genuine economic and monetary union ”, 5 december 2012, http : / / ec. europa. eu / economy _ finance / focuson / crisis / documents / 131201 _ en. pdf. bis central bankers ’ speeches

place in may in the bond exchange nevertheless had far - reaching effects for the south african financial situation. the yield on long - term government bonds, for example, rose from a monthly average of 12. 9 per cent in april to over 18 per cent in september, and fluctuated widely on a daily basis to peak at over 21 per cent at one stage. the adverse effects of the net selling of bonds by non - residents quickly spilled over into the market for foreign exchange. pressures in this market led to an eventual devaluation in the nominal effective exchange rate of the rand of 16. 4 per cent from the end of april 1998 to 31 december 1998. the country ’ s net gold and foreign exchange reserves, which increased by almost r19 billion over the fifteen months that ended in march 1998, then declined again by r12½ billion over the last three quarters of last year. at the end of 1998, the total official reserves of the country amounted to about r31. 6 billion, the equivalent of about two months ’ imports. these changes in the capital account of the balance of payments, which were obviously directly linked to the worldwide dispersion of the east asian crisis, forced the reserve bank to switch to – 2 – a more restrictive monetary policy. the interest rate on the reserve bank ’ s daily repurchase transactions with banking institutions increased from below 15 per cent in early april 1998 to almost 22 per cent in august. in light of the declining amount of liquidity in the banking sector, and the rising rate for reserve bank accommodation, banking institutions raised their prime lending rate from 18 per cent in april 1998 to over 25 per cent in august. with these adverse developments in the financial markets, the outlook for an early improvement in real economic activity faded. on the contrary, overall economic activity slowed down further. in the third quarter, total real gross domestic product indeed showed an annualised rate of decline of 2½ per cent. it is estimated that, on balance, total gross domestic product in 1998 was not much different from that of 1997. the negative developments in the global financial and commodity markets had some adverse effects also on the current account of the balance of payments. the deficit indeed increased from a level of about r7 billion in the first half of the year to a level of about r18 billion in the second half. special imports, however, contributed to this increase in the negative balance, and indications are that the growth in imports is now slowing down in line with the more