globalization, and the collapse of this system offers us a cautionary tale. furthermore, in a world where public and private actors taking part in economic activity are becoming ever more diverse, it would be quite a challenge to agree on what is desirable globalization and what is not. if, in despair, unilateral action, such as trade bans, mandatory domestic incorporation, or forced repatriation, is taken, everybody would become worse off. is there a way out of this predicament? if the objective of global governance is to secure global financial stability, and if global financial stability is a public good, global governance can be analyzed as a microeconomic problem regarding public goods. there are well - known options to solving the problems posed by public goods. the most straightforward is to have the public sector provide the public goods. alternatively, rules could be established regarding the consumption of public goods. another option is to tax the consumption of public goods or subsidize the production thereof. there are still other options, such as changing the public character of the goods by increasing their exclusivity. not all may be applicable to international financial stability, and some may be more easily implemented than others. in view of the discussions during various international fora in which i have participated, i have a feeling that we are making it more difficult for ourselves by opting for the seemingly most obvious option – tasking the public sector with providing international financial stability. as tommaso observed, there is a limit to what individual nation states can provide as global public goods. a coherent set of public goods provided by a single global public entity would be desirable, but there is no workable way of introducing such an arrangement consistent with our democratic principles. international organizations are often criticized for deficits in democratic accountability. on the other hand, a democratically elected world government with the power to tax is unthinkable in the near future. the current situation in the euro area is an example of this intractable problem. we therefore should aim for a more practical approach, combining various options that are known for solving the public good problem. some public goods, such as effective supervision of globally important financial institutions, could be provided at the national level. supranational institutions could be asked to take on specific tasks, such as monitoring global financial developments and identifying macroprudential risks, without undermining democratic principles. private actors could be made to follow certain rules, such as the basel rules on

a very effective and efficient way. we therefore agreed to extend the contract by 11 months and to deepen the work in three areas. this work has now too been fully completed and we are ready to close the programme. in most of the areas covered during this time, the national bank of serbia will continue to implement work that we started together. you can, for instance, look forward to new and updated statistics for the balance of payments and for the financial accounts, which the national bank of serbia plans to start publishing in the next few years. it also has new bis central bankers ’ speeches analytical tools for both macroeconomic and financial stability analysis, allowing it to speak with a stronger voice in the national and international debate. these are only a couple of examples of what this programme has achieved. obviously the work does not end here. there are still areas within the national bank of serbia that need upgrading before it joins the european system of central banks. in addition, the eu continues to update rules, regulations and best practices, which means that the target is always moving. let me turn to a few points that are not directly linked to the programme, but are important as they relate to current challenges in the eu as well as in serbia. common challenges in the euro area and in serbia while central banks have done what they can to limit the most devastating effects of the global financial crisis, there are limits to what the central bank can do. the ecb can keep interest rates low and resort to non - standard measures as warranted by exceptional circumstances, in line with our mandate of price stability. maintaining price stability is the best contribution that a central bank can make to support economic growth and employment. we cannot, however, address by ourselves the underlying root causes of the problems that relate to fiscal and macroeconomic imbalances, a lack of competitiveness, low growth and high unemployment. governments of eu member states have to do their part of the work through structural reforms and fiscal consolidation to return the economy to long - term sustainable growth and to boost employment. while the challenges are obviously not identical, these same issues are also relevant for serbia. structural reforms to enhance competitiveness and support growth potential, fiscal consolidation and ultimately sustainable convergence are challenges to be addressed by the political authorities in this country in their endeavour to move closer to the eu. the best contribution the national bank of serbia can make to support this is to achieve price stability, based on a sound institutional framework that ensures its independence. turning back to the