jean - claude trichet : further integrating euro area economies – some reflections speech by mr jean - claude trichet, president of the european central bank, at the 57. jahresversammlung des ifo instituts fur wirtschaftsforschung an der universitat munchen, munich, 29 june 2006. * * * ladies and gentlemen, sehr geehrte damen und herren, herzlichen dank fur die einladung nach munchen. es ist mir eine grosse ehre und freude heute zu ihnen zu sprechen. viele von ihnen leisten einen direkten und eminent wichtigen beitrag dazu, europa zu verandern und zu modernisieren. lassen sie mich zu diesem wichtigen thema mit einigen uberlegungen uber die weitere integration der eurozone beitragen. we at the ecb pay very close attention to your work. and it is certainly not only the well - known ifo business climate index that we carefully read each month. we have a deep interest in the original and rich economic research done here at the ifo institute, or that is catalysed by the cesifo research network, for which the institute has been praised again recently. the profound restructuring and reorganisation that you have conducted in recent years is really paying off. furthermore, one only needs to have a cursory look at bookshops and libraries and it becomes evident that your work, dear mr. sinn, on many topics is appreciated well beyond german borders in your recent book, but also in other papers you wrote, you put forward a thesis aimed at reconciling what you call the “ german puzzle : ” i. e., the contemporaneous high merchandise export and slow growth. your analysis is relevant and interesting, but also very thought provoking. you point to high wages that lead to outsourcing as some of the explanations of the puzzle. independently from the position that one has vis - a - vis your analysis, and agreeing with it or not, you have launched a valuable debate. last but not least, i would like to mention how much we appreciate the efforts of ifo toward the “ european economic advisory group ” which serves as a role model for european integration. consisting of a team of eight distinguished economists from eight european countries, it produces, on an annual basis, a valuable

the beginning of 2013. against the background of weak credit growth, the ecb is finalising the comprehensive assessment of banks ’ balance sheets, which is of key importance to overcome credit supply constraints. to sum up, a cross - check of the outcome of the economic analysis with the signals coming from the monetary analysis led the governing council to decide on measures to provide further monetary policy accommodation and to support lending to the real economy. with regard to structural reforms, important steps have been taken in several member states, while in others such measures still need to be legislated for and implemented. these bis central bankers ’ speeches efforts now clearly need to gain momentum to achieve higher sustainable growth and employment in the euro area. determined structural reforms in product and labour markets as well as action to improve the business environment are warranted. as regards fiscal policies, comprehensive fiscal consolidation in recent years has contributed to reducing budgetary imbalances. euro area countries should not unravel the progress made with fiscal consolidation and should proceed in line with the stability and growth pact. the pact acts as an anchor for confidence, and the existing flexibility within the rules allows the budgetary costs of major structural reforms to be addressed and demand to be supported. there is also leeway to achieve a more growth - friendly composition of fiscal policies. a full and consistent implementation of the euro area ’ s existing fiscal and macroeconomic surveillance framework is key to bringing down high public debt ratios, to raising potential growth and to increasing the euro area ’ s resilience to shocks. we are now at your disposal for questions. bis central bankers ’ speeches