in fact, central banks contribute to financial stability. but improved coordination and institutional innovations, while necessary, are not sufficient to make the euro area economy more resilient to adverse shocks. to enhance the adjustment capacity of the euro area economy, the current situation should serve as a catalyst for the resolute implementation of the necessary reforms. this would enable the member states of the eu to fully exploit the benefits of economic and financial integration, with positive effects on growth potential and job creation in the euro area. having said all this, we should not forget how europe would look today without the euro. an issue that was only marginally addressed during the conference. it goes without saying that the euro area countries would be significantly worse off. multiple crises would arise simultaneously. currency crises would go hand in hand with banking crises and real economy disruptions at country level. these currency crises might also spill over to other countries in the region. not to forget political tensions between countries. by eliminating contagion via the exchange rate channel, the euro has mitigated the risk of contagion stemming from national economic or financial crises. in this sense, the euro has been a very important stabilising element in difficult times. it is therefore not surprising that many central and eastern european countries would like to join the euro area on a fast - track procedure to be better shielded from global financial tensions and crises. this is understandable, given that many of them have already made progress towards adopting the euro. but we have also heard clear words of caution. let me take the opportunity to emphasise that the euro area is not a closed shop. following three enlargement rounds since the start of monetary union in january 1999, and with slovakia joining the euro area as its 16th member on 1 january 2009, there is no reason to believe that the door might one day be closed. but there is no shortcut. in fact, the difficulties that some countries face today are related to their failures to adjust, failures that go back a long way. as a result, domestic and external imbalances have emerged, with adverse effects on the sustainability of the catching - up processes in those countries. the fast introduction of the euro would not resolve the underlying problems – but could weaken emu. structural adjustments as well as nominal and real convergence are therefore needed prior to the adoption of the euro. this means that the countries concerned must achieve a sustainable level of nominal convergence at high standards in terms of meeting the convergence criteria. the

: the aftermath of the asian crisis in the late 1990s ; the bursting of the dot. com bubble ; 9 / 11 ; and sharp rises in oil and food prices worldwide. over this same period, the euro area has also had internal imbalances to contend with. an issue that was intesively discussed yesterday. these imbalances remain a challenge. while emu highlights the need for flexible economies, the euro cannot be blamed for the emergence of those imbalances. rather, this largely reflects a lack of adjustment in a number of member states. this is particularly true for those euro area countries whose adjustment mechanisms and responsiveness to exogenous shocks is still rather slow. to allow euro area economies to develop their growth potential and to reap the full economic benefits of emu, it remains indispensable that the countries concerned bring their structural reforms and fiscal consolidation measures more into line with the conditions and rules of monetary union. overall, the ecb has done well to overcome these difficulties. however, the current global financial distress poses challenges of a significant and unprecedented nature to the ecb and other central banks around the globe. with this crisis, emu is now ultimately experiencing a real test. in these demanding times, some widely - recognised core principles have helped the ecb to weather the storm. the maastricht treaty assigns a clear and unambiguous mandate to the ecb to maintain price stability. it also grants the ecb full independence from political influence to fulfil this mandate. besides these institutional safety belts, monetary policy needs to be forward - looking, medium - term oriented and underpinned by a comprehensive analytical framework. given the monetary nature of inflation over the longer term, such a framework must include a thorough analysis of monetary and credit developments to allow for wellinformed and consistent decision - making. finally, one principle – that has gained much attention during the current crisis – is to keep the determination of the monetary policy stance distinguished from the management of liquidity in money markets. all these principles are captured in the ecb ’ s monetary policy strategy. and globalisation does not fundamentally alter these principles – which give guidance, in particular, in critical times. to weaken or even abandon these principles would undermine our commitment and credibility. and, in the end, we would risk losing orientation. our strategy has provided a consistent and coherent framework not only for internal analysis and policy decision - making but also for external communication. using the same framework for internal