. we agreed to do so because this is exactly the sort of initiative that i have been describing above. the lack of integration of short - term securities markets, relative to other segments of the money market, was identified some time ago. competition alone did not allow us to overcome this problem, and while public action may be warranted to remove obstacles to this integration - in particular in the legal field it cannot achieve it alone. co - ordinated action by market participants may be the best means to address this issue, and that is why we welcomed the initiative of the aci and have lent our logistical support to it. conclusions what i conclude from these examples is the following. there are possible ways, in between pure legislative or regulatory action on the one hand, and sheer competition on the other, for promoting the integration of the financial markets. one such way is coordination within the private sector. it is a common experience around the world that where this avenue is used without endangering competition, it can produce the desirable results. our assessment is that this particular avenue has perhaps not been explored as widely as could have been the case in europe. we, at the ecb, are willing to support this co - ordination within the private sector. i insist, however, that initiatives have to come from the market, from you. our role is to acknowledge and help to bring about your full potential. yours is to take advantage - both individually and collectively - of the opportunities open to you. together, we can progress towards a level of market integration that can make eu markets more attractive, more resilient and more effective. this would benefit each market user, it would benefit the financial community as a whole and - even more importantly from my point of view as a central banker - it would help to unleash more growth potential for the european economy.

as standing for high quality. but international trade is not a process in which only one party gains. each export corresponds to an import, and economies benefit mutually from each other. many goods that are bought in the euro area are made in other countries, far away from their consumers. transport costs have decreased, technology has become universal, information is readily available at low cost, and tastes have been converging. during the last three decades tariffs have halved and over 230 trade agreements between various countries have entered into force. all these developments have resulted in a steady opening of markets in europe and worldwide. in the early 1970s global exports accounted for only one tenth of world gdp, but they have increased to one quarter of world gdp today. this is a reflection of the dramatic deepening of global economic interlinkages in recent years. in my view, it is important to bear in mind that regional trade integration does not hinder global integration, but is in fact one efficient way of fostering it. there is also a more recent phenomenon that is less visible, but even more dynamic, namely global financial integration. by this i mean the integration of local and national financial markets into a more unified international financial market. only a few decades ago, the realisation of an investment project was largely contingent on the availability of capital in the local economy. today the opportunities to raise finance as well as to invest capital are truly global. the substantial number of bilateral investment treaties and the liberalisation of capital accounts have further encouraged cross - border investment. 1 while in the 1970s over 80 % of all countries restricted access to foreign capital, today only 60 % of developing countries and no industrialised countries have capital accounts which are still more or less closed. 2 in the 1970s, worldwide cross - border holdings of assets amounted to only one tenth of world gdp. since then, cross - border capital flows have steadily increased, and countries have now accumulated foreign assets in an amount equivalent to the annual gdp of the entire world. in 2003, euro area residents held foreign capital with a total value of 7. 6 trillion euro, a figure that is somewhat higher than the euro area ’ s annual gdp. but financial integration is also intrinsically linked to the real economy. over the past 30 years, annual foreign direct investment ( or fdi ) worldwide grew from around 8. 5 billion euro ( 10 billion us dollars ) to almost one thousand billion euro ( about 1200 billion us dollars ). the value of foreign - owned companies around the