* markets can be defined by the instruments that are traded on them : oil, gold, foreign exchange, interest rates. but they are also defined by the people who use them. a marketplace brings together people who, by virtue of trading with each other, share common interests. it forms a community. and as for all communities, the protection of each of its members against potential abuse by others requires appropriate governance. this raises a particular issue for those markets that extend across national borders. it is that issue which forms the topic of my remarks. bis central bankers ’ speeches 1. the benefits of cross - border markets cross - border markets are a fact of contemporary life. there have of course been periods of high integration of global trade and finance in the past – the decades immediately preceding world war i were a particularly stark example. but markets have never been more integrated than they are today. trade integration is ever more facilitated by technological progress, making the transportation of goods easier and faster ; and by the fact that, in a digital age, a rising share of services in global output makes the distance on the ground between producers and consumers less of an obstacle to transactions. that is why global integration of trade 1 has risen sharply from 39 % of gdp in 2000 to 48 % in 2014. for the euro area, trade openness has increased from 58 % to 66 % of gdp over the same period. the same applies to finance, too – and perhaps all the more so. capital can be shipped across vast distances at virtually no cost. and there are good reasons why we should want in principle to facilitate cross - border investments. financial markets intermediate between the needs of savers and borrowers ; they open up a range of opportunities to both, thereby supporting innovation ; and they allow risks to be shared among those more willing or better equipped to bear them. all of this applies across borders as well as within borders. let me give you an example. countries, just like individuals, have different needs for capital at different stages of their demographic lifecycle. those with young demographics exhibit demand for capital from overseas, while countries with more mature populations have excess savings as they accumulate assets for retirement. in the case of europe, our demographics would justify a moderate current account surplus and capital account deficit. put differently, we benefit from open markets because we need to be able to invest abroad part of the savings that will finance our pensions. 2 for all these reasons, the belief that open markets are conducive to freeing human

same way. but each needs to be able to respond as necessary. otherwise, we risk widening asymmetries and exiting this crisis with greater economic divergence. this underscores why a common european fiscal response is so desirable. first, it will help bridge the gap for member states and counter that risk of divergence. given the fiscal needs already on the horizon, it needs to be swift, sizeable and symmetrical. second, it will help guide us towards the europe we want to build after the crisis. we have been given a chance to take a leap forward : to reimagine our social contract, reconsider europe ’ s strategic autonomy, and recognise the risks of not taking the environment seriously. these are all areas where acting together is in our common interest. let me give just one example : we have now experienced the consequences of a systemic ecological crisis, and we are also likely to face a period of weak private investment as firms repair their balance sheets. public investment will have to fill the gap. it makes sense to use this opening to accelerate the transition to a green economy and hit our climate targets. the recovery presents a further opportunity, too : to engage citizens in the process of defining our common interest and the areas where europe should be stronger. in sum : this is our generation ’ s “ schuman moment ”. we have been passed the baton of european integration. we are seeing our de facto solidarity all around us. and we are being asked to act, as those before us did, by strengthening europe in response. i am confident that we will recognise our historical responsibility and rise to the challenge. 2 / 2 bis central bankers'speeches