digital, innovation. the timescale will have to be relatively long, covering several legislatures, and the objectives will need to be pursued with perseverance and far - sightedness, with widespread consensus among the population. its success will depend on the extent to which public initiative can combine with an adequate response of the productive and financial system. new opportunities will be created, but considerable investment will also be required, together with an efficient allocation of savings and careful management of risks. the financial system will also have to play a part. in order to exploit the opportunities connected with financing the energy transition, intermediaries will need to incorporate adequate models for the assessment of climate risks into their operational processes. the aim is not to phase out the activities with a bigger carbon footprint altogether, but to help energy - intensive firms to significantly reduce their emissions whenever possible and appropriate. to go in that direction, it will be decisive for firms to provide intermediaries and investors with detailed and reliable information, and to make credible transition plans. managing the implications of the digital transition effectively is a crucial challenge for the financial system. the bank of italy supports and promotes innovation by ensuring that market infrastructures are safe and efficient, that the regulatory framework and risk management processes are up to date, and by providing consumer protection and financial education. these safeguards are key to ensuring that italy can make the most of the digitalization of the economy and of finance, thereby minimizing their risks. this area also includes the challenge posed to the eurosystem by the possible introduction of a digital euro, which we are actively helping to develop. the ecb governing council will decide this autumn whether and how to proceed to the phase of defining the required technical and commercial solutions. a final decision on going ahead with a digital currency will in any case require the adoption of the necessary regulatory framework by the european parliament and the council of the european union. * * * banca d ’ italia the governor ’ s concluding remarks annual report 2022 at a time of deep uncertainty, with the distress caused by the emergency, we wondered three years ago what effects the pandemic would have on our behaviour, on the production system, on how we work and on our consumption habits. recognizing that ‘ we knew that we did not know ’, we discussed new ‘ equilibriums ’ and a new ‘ normality ’, with profound doubts, and we talked about the crucial role that extraordinary budgetary interventions and sizeable and timely monetary policy measures would have

integrated economic union. aside from having an unprecedented opportunity to tackle long - lasting problems, the countries that benefit most from these resources – first and foremost italy – must also demonstrate the real usefulness of such greater integration, providing tangible results. at the same time, however, we need to be aware that to complete the european project we must first overcome major institutional and political hurdles. an essential requirement for this lies in a renewed and firm commitment by all member states to seeking common solutions to common problems. we need to increase and, on certain matters, restore trust between european citizens, keep the political dialogue alive and constructive, and reduce the seemingly widespread mistrust of the eu institutions. as for fiscal policies, the reform should rest on two key pillars : rethinking the rules and building an effective fiscal capacity, backed by own resources and, when necessary, by issuing debt. on the former pillar, a major step forward was taken with the presentation of the european commission ’ s reform proposal in april, a proposal that goes in the right direction. it focuses on mediumterm fiscal sustainability and long - term economic growth, while making the rules less complex and more credible by involving national authorities in the fine - tuning process. the commission ’ s proposal may not meet the expectations of all member countries, for various reasons. the goodwill of all is needed to find a viable and shared solution. the rules must be applied to a world that is marked by intricate interdependencies and unexpected shocks, where national fiscal outcomes cannot be assessed out of context. yet compliance with the fiscal banca d ’ italia the governor ’ s concluding remarks annual report 2022 rules and their credibility are in the interest not only of the union as a whole, but also of each of its countries. they are crucial for italy, aiming to reduce its overly high public debt over time, and consistent with the fiscal discipline recognized as necessary by our constitution. the introduction of a supranational fiscal capacity, which is missing in the commission ’ s reform proposal, would make it possible to manage both country - specific shocks and common adverse events, such as the pandemic and the energy crisis, more efficiently. if the current institutional and political challenges make it difficult to achieve a fully - fledged fiscal union in the near future, we could build on the tools put in place during the pandemic emergency pragmatically, for example by designing forms of joint financing for automatic stabilizers, as we did with the