carlos da silva costa : farewell speech in honor of president mario draghi address by mr carlos da silva costa, governor of the bank of portugal, at the ecb governing council dinner in honor of president mario draghi, frankfurt am main, 23 october 2019. * * * as prepared for delivery dear mario, dear friends, as the longest serving governor of a national central bank in the governing council, i have been awarded the privilege and honour to say a few words at mario ’ s farewell dinner. when mario took office as president of the ecb eight years ago, europe was diving deep into the sovereign debt crisis. financial markets questioned the ability of highly indebted euro area countries to pay back their debts. a break up of the euro was a real possibility and redenomination risk premia appeared. eight years have passed, the euro is here to stay, and rests on much stronger foundations. mario´s contribution to this outcome cannot be overemphasised. his leadership as president of the ecb has shown a remarkable ability : to evaluate the context ; to separate what is essential from what is secondary ; to build consensus within the ecb ’ s governing council to pursue the required unconventional policies ; and last, but not least, to convince european leaders of the need to strengthen the foundations of the emu. mario provided impetus to the creation of the banking union, and took upon the ecb the task of setting up the single supervisory mechanism. mario has had the courage to search for solutions that tested the limits of our common mandate, while being open and flexible on how to achieve it. in doing so, he had to cope with a lack of understanding by important sectors of public opinion. with its balanced and determined decisions to define the outright monetary transactions mechanism and to provide conditional financing to the greek banking system, the ecb effectively saved the euro. with its bold unconventional policies, the ecb effectively prevented the euro area from sliding into deflation. it also allowed the time for political agents to adjust their fiscal policies, to adopt structural measures and to agree on institutional improvements needed for a sustainable economic and monetary union. mario has proven to be intellectually curious and open, looking at facts and questioning theories. he has instilled mental discipline among all of us working with him, and throughout the ecb. without annulling differences in opinion, mario was able to make us converge to a common course of action. mario, dear president, you understood the problems we were confronted

##makers and market participants alike can best contribute to the development of a reformed and robust financial architecture. i see more promise than peril over the horizon. the speed of these changes in the financial architecture understandably brings fear to some market participants, but it may equally sow the seeds of recovery. policymakers are keenly observing the pulse of private financial institutions and other market participants to gauge their ability to take up the cause of reform and renewal. if financial institutions readily and steadily approach new ways of intermediating credit, the real economy might recover sooner and with more vigor than expected. if not, if private market participants prove unable or unwilling to establish new business models, then the effects of the current financial market turmoil may be a significant drag on economic growth long after stability is ostensibly achieved. getting the architecture right is essential to address the central challenge facing our economy. see warren buffett ( 2008 ), “ buy american. i am. ” an op - ed in new york times, october 17.