labour market rigidity, the stressed countries have made noticeable progress in this area. in addition, the retirement age has been raised as well. product market rigidities that weaken competition, produce regulatory red tape and inhibit growth are also being addressed. and according to the world bank ’ s doing business report, progress has been made in this regard as well : portugal, italy, and spain have climbed up bis central bankers ’ speeches the ranking ladder by 17, 13, and 10 positions respectively over the last four years. greece has even moved up 37 positions. current accounts in the deficit countries have improved – not only because of shrinking imports, but also because of expanding exports. the latter has been supported by decreasing unit labour costs. spain has markedly improved its price competitiveness through lower unit labour costs. currently, unit labour costs are 6½ % below their pre - crisis level, while they have risen by 10 % in the euro area as a whole. in the stressed countries, factors of production are being reallocated to sectors with a strong focus on exports. the construction sector in ireland accounted for over half of the decrease in aggregate employment ; in spain, italy and portugal, it accounted for around two - fifths. in industry, by contrast, either far fewer jobs have been cut or – as in ireland – new jobs have recently been created. thanks to improved competitiveness, spanish exports have risen by 8 % over the past 12 months. since the cyclical trough in 2009, exports have even risen by more than 50 %, with intermediate goods showing particularly strong growth. overall, thanks to the reform efforts made so far, the underlying conditions in most of the periphery countries are already significantly better than they were before the crisis. progress has been uneven, though, and further reforms are needed. to address the problem of very high unemployment, the imf recommends more decentralised wage setting and the introduction of greater flexibility at the firm level to adapt wages, working hours and employment to the economic situation, which might also be a way forward for spain. overcoming the crisis is still an uphill struggle ; if you don ’ t go forwards, you go backwards. with regard to reforms, governments therefore have to keep the pedal to the metal. however, is it a german central banker ’ s task to call for structural reforms and budget consolidation in other euro - area countries? given the important role that sustainable public finances and highly productive member states play in buttressing a stability - oriented monetary policy, and

pickup will be. in this context, i would certainly be very interested to hear your views on the situation here in the midwest, and in the united states as a whole. as i recently said to our parliamentary committees, we see two or three key differences in the canadian and u. s. situations. first, it is clear that there was a tremendous buildup of capacity in the telecommunications and information technology sectors in recent years, and some analysts expect that it will likely be well into 2003 before we see any recovery in investment there. but i would note that these sectors represent a smaller proportion of the canadian economy than the u. s. economy. the second issue we have noted is that small - and medium - sized firms tend to be more bullish about their outlook and investment intentions than large, multinational firms. i'd certainly be interested in hearing your perspective on this. but again, i'd point out that these smaller companies make up a larger share of the canadian economy than of the u. s. economy. the final point i made to the committees has to do with the potential impact of higher oil and natural gas prices on investment. while higher oil and natural gas prices stemming from developments in the middle east could hurt consumers, they could lead to much greater drilling and exploration activity in canada. of course, that sector remains a significant part of our economy.