##t supervisor ; this is ruled out by the treaty. furthermore, there are also only limited synergies between prudential supervision and aml / cft supervision. from our perspective, a strategy to strengthen the eu aml / cft framework could comprise at least two elements. first, a further harmonisation of the aml / cft rulebook could address possible divergences and shortcomings in the way the rulebook was transposed in different member states. it could also strengthen enforcement of aml / cft compliance through aml / cft supervisors by providing clear regulatory guidance and harmonised, stronger supervisory powers. this could be achieved by transforming the aml directive into an eu regulation, which would have the potential of defining a harmonised anti - money laundering framework that is directly applicable throughout the european union. to be effective, the scope of a future regulation should be as broad and encompassing as the legal base would allow, also with a view to moving towards a more rulebased approach, while fully respecting the legal constraints and the remaining variety of national institutional setups, 1 particularly in the area of criminal law and justice systems. 2 3 / 4 bis central bankers'speeches second, supervisory fragmentation should also be addressed, especially in relation to coordination and cooperation procedures. this could be achieved by charging an eu body or a new authority with aml / cft tasks. this eu body or authority should be independent to allow it to act decisively in addressing ml / tf risks. it could detail a single aml / cft rulebook via technical standards and / or guidelines, coordinate its implementation and ensure strict and harmonised aml / cft supervisory practices in the eu and across member states, leveraging on the experience and expertise of national supervisors. the eu aml / cft body should make sure that accurate and timely assessments on possible irregularities and ml / tf risks are proactively provided to prudential supervisors, including the ecb in its supervisory role, 3 so these risks can be factored into their prudential assessments. finally, if supported by co - legislators and primary law, the eu aml / cft authority could be equipped with direct aml / cft supervisory powers. conclusion ladies and gentlemen, anti - money laundering and combating the financing of terrorism are challenging endeavours. first, they involve several areas of law at both the eu level and national levels. changes that lead to an efficient distribution of competences might

challenging. growth forecasts for the euro area for the current year remain negative, while countries in the region face muted growth prospects. nonetheless, serbia ’ s country risk premium has declined, as a result of the easing of the euro area sovereign debt crisis and expansionary measures taken by the european central bank, the eu ’ s positive decision on serbia ’ s candidate status, and affirmation of the country ’ s credit rating. in fact, looking at the region, the sharpest fall in embi this year was registered for serbia. the dinar nonetheless weakened against the euro. depreciation pressures were driven by several factors : increased energy imports due to cold weather, lower exports, departure of the private owner from the smederevo steel plant, postponed review of the arrangement with the international monetary fund, increased government spending, and reduced capital inflow. bis central bankers ’ speeches * * * together with a spell of extremely cold weather in february, recessionary trends in the euro area and sluggish growth of the regional economies have led to a contraction in serbia ’ s economic activity in early 2012. according to preliminary estimates for the first quarter, gross domestic product fell by 0. 5 % from the previous quarter and by 1. 3 % from the same period last year. unfavourable weather conditions in february strained and even restricted electricity supply to a large number of enterprises. together with the suspension of operations of the smederevo steel plant, this pushed manufacturing down by as much as 12 %. however, as the production not only normalised in march, but also compensated in part for what was missed in february, manufacturing picked up by 19 %. the same factors had a decisive impact on exports, which followed a pattern similar to that of manufacturing in the first three months of 2012, while recording a mild fall at quarterly level. the steepest drop in exports was registered for base metals, chemicals and chemical products, while exports of agricultural products and electrical equipment increased. cold weather prompted an increase in imports of energy, and thereby, intermediate goods, pushing overall imports higher. on the other hand, imports of equipment and consumer goods recorded a decline. economic activity contracted in the first quarter. the negative contribution came from net exports, as well as lower private sector investment, signalled by a dip in imports of equipment and reduced construction activity, and adverse weather conditions. conversely, an upturn in retail trade points to a positive, though modest, contribution of household consumption to economic