momentum of implementation for the remaining issues. let me just mention three areas that i think are of particular importance : first, we must pay more attention to financial stability and systemic risk considerations ; this applies particularly to the global monitoring of system stability and the supervision of cross - border systemically important institutions. for the supervision of cross - border systemically important institutions we need strong international cooperation and clear rules, in particular regarding potential burden sharing. for the global monitoring of systemic risks, the envisaged close cooperation between the international monetary fund and the financial stability board in the conduct of early warning exercises has a crucial role to play. second, the pro - cyclicality of the financial system must be limited. in this regard, it will be crucial that the financial stability board, the basel committee and other bodies develop and implement appropriate regulatory and supervisory tools to promote the build - up of reserves in good times to be used in times of stress. it will also be important to reduce the probability of individual bank ’ s insolvencies by making appropriate provisions of capital. and third, regulation and oversight must be improved and expanded. in this respect, let me particularly stress in this context that all systemically important institutions, markets and instruments should be subject to an appropriate degree of regulation and oversight. this includes in particular systemically important hedge funds, credit rating agencies and otc “ report of the financial stability forum on enhancing market and institutional resilience ”, published on 12 april 2008. note that the fsf has been recently renamed the financial stability board, with expanded responsibilities and membership. “ principles for sound liquidity risk management and supervision ”, endorsed on 25 september 2008 ; and consultative papers on the enhancements to the basel ii capital framework, issued on 16 january 2009. derivatives markets, whose inclusion in the regulatory net has been already endorsed by the g20 leaders. it is only thus that we can in future prevent regulatory arbitrage between sectors and markets as well as the emergence of “ shadow markets ”. the role of europe but let me now move to the key question of this panel discussion : what should europe ’ s role be in this new financial architecture? in my opinion, europe has a chance to act as a powerful force in shaping the future of financial markets, if it acts in a coordinated and cooperative manner. i think that the first foundation stones for this have been laid. just think of the determination that the eu leaders showed last autumn in addressing the financial crisis ; together they produced a common

crisis in 2008 – 09. 1 now, some think we ’ ve entered a new period of “ deglobalization. ” others see it as a slowdown in globalization — a “ slowbalization. ” the enormous disruptions caused by the pandemic make the recent trend hard to discern, but there ’ s no question global trade growth has at least slowed ( chart 1 ). 1 s. aiyar, j. chen, c. h. ebeke, r. garcia - saltos, t. gudmundsson, a. ilyina, a. kangur, t. kunaratskul, s. l. rodriguez, m. ruta, t. schulze, g. soderberg and j. p. trevino, “ geoeconomic fragmentation and the future of multilateralism, ” international monetary fund staff discussion note no. 2023 / 001 ( january 2023 ). - 3that ’ s a big concern, especially for open economies like canada and the united kingdom. to some extent, a slowdown in global trade growth was inevitable. once tariffs were substantially reduced and most economies were participating in global markets, the potential to expand trade by lowering tariffs further and including more countries became more limited. but recent events have exacerbated this slowdown. new global tensions have added trade frictions between competing countries. public and political support for open trade is also waning, in part because the benefits have not been evenly shared. we ’ ve all benefited from a wider selection of goods and services at lower prices. but when lowcost importers undercut domestic producers, workers who lost their jobs lost more than they gained. with changing economics, new security threats, and waning support, global trade is being rewired, recast and redirected. trade is being rewired by shifting international economics. china is no longer the lowest - cost global supplier of consumer goods. production of many manufactured goods is moving elsewhere. as china moves up the value chain, it ’ s competing more directly with advanced economies. at the same time, the pandemic, russia ’ s invasion of ukraine, geopolitical conflict and climate change have all made supply chain resilience a greater priority, even at the cost of efficiency. trade policy is being recast to encompass national and economic security and to foster leadership in strategically important industries. trade and industrial policy are being used to make the supply