countries with a greater share of private equity investment also, on average, have higher growth rates. 1 private equity is also an important variable for the german labour market : bvk statistics show that, at the end of 2010, german portfolio enterprises in which private equity companies were invested employed some 1. 2 million people. 2 as for the financial sector as a whole, the last few years were not exactly rosy for private equity companies either. investments by private equity companies, which had plummeted during the crisis, are now, however, showing signs of recovery. in 2010, new investments by see meyer ( 2006 ) : private equity : spice for european economies, journal of financial transformation, vol 18, november, pp 61 – 69. see bvk statistics – the year 2010 in figures, march 2011. bis central bankers ’ speeches private equity firms in germany rose by almost 60 % year - on - year to stand at €4. 4 billion. capital invested by german private equity companies thus totalled just under €36 billion last year. at roughly 0. 1 % of german gdp in 2009, investments are, however, still relatively insignificant. moreover, they are below the european average of just under 0. 2 % of gdp. 3 however, that also demonstrates the growth potential of the german market for private capital. generally speaking, growth always requires a stable environment, and that brings me to the reform of the international financial system. 3. reform of the international financial system : the road towards new regulation it is clear that we must do all we possibly can to prevent a repeat of the global financial and economic crisis that has been keeping us enthralled for some four years now. reform of the institutional and regulatory framework of the international financial system is therefore in full swing ; and it has doubtless already been improved significantly in key areas. besides creating greater transparency, a central aspect of the ongoing reform is to increase the quality and quantity of financial institutions ’ equity capital. the new capital and liquidity standards for the banking sector were discussed at length ; they will go into the post - crisis text books as “ basel iii ”. the new rules will ensure that capital requirements rise considerably – in terms of both quantity and quality. to ensure that financial institutions have a better liquidity cushion in future and are less vulnerable even in periods of stress, the firsttime introduction of global liquidity standards has been agreed. the g20, at their meeting in seoul in november of last year, committed

trend of globalization is likely as covid - 19 subsides. in addition, new structural changes may emerge based on the experience of the pandemic. for instance, the use of it and ai is expected to make further inroads in a variety of areas ; for example, making teleworking as common in japan as in other countries. further, with the shift to services likely to continue in advanced economies and with labor shortages expected to continue due to demographic trends, a key challenge for japan's economy will be to boost labor productivity through the active use of it and ai. c. expanding role of monetary policy and challenges ahead lastly, i would like to touch upon monetary policy challenges going forward, taking into account the structural changes expected in the post - covid - 19 era. first, in a situation where it is necessary to strike a balance between containing covid - 19 and helping the economy to recover, the immediate challenge for monetary policy is to support japan's economy from the financial side. specifically, the key priorities are to continue with large - scale monetary easing under the current monetary policy framework, maintain financial market stability, support corporate financing, and contain increases in corporate bankruptcies and unemployment. in doing so, it is necessary to continue working together with the government and other major central banks in order to respond flexibly in terms of macroeconomic policy and to ensure market stability. next, in conducting monetary policy, one of the medium - to long - term challenges facing the bank is to ensure stability of the financial system. if economic recovery takes longer than expected, it is possible that an upsurge in corporate bankruptcies could impair the soundness of financial institutions, placing the financial system at risk. if financial institutions - - which play a key role in providing financial support for corporate business activities - - can no longer fulfill their financial intermediation function, this would exert downward pressure on the real economy, which, if the situation were to persist, could potentially weaken the growth potential of japan's economy. developments such as the transformation of working styles through the use of it and ai can have a positive impact in terms of revitalizing regional economies. in light of this, it is essential to firmly maintain financial system stability over the medium to long term to allow financial institutions to effectively carry out their roles in promoting new structural changes. the bank will take the necessary responses to enable the appropriate functioning of financial intermediation. in closing, let me rei