numerous channels have been identified in economic theory through which globalisation can influence the level of prices. without doubt, globalisation and the associated rise in world trade have contributed to import price moderation, 5 notably in the manufacturing sector, which is primarily due to increased imports from low - cost countries. furthermore, the widespread opening - up of emerging countries and of almost all former centrally planned economies has significantly increased the labour pool available, leading to dampening pressures on labour costs, especially for unskilled labour. globalisation can also exert pressure conducive to lower inflation more indirectly, as increasing international competition may have limited the pricing power of domestic corporations. however, at the same time, the sudden emergence of fast - growing economies in the global economy is exerting upward pressure on prices for energy and raw material prices. 6 regardless of the intensive research currently pursued in particular in academia, at central banks and at various international institutions, there still remains significant uncertainty about the aggregate role and impact of globalisation. even though the net effect of these counterbalancing forces is mostly believed to have contributed towards reducing inflation, whether and how long this disinflationary effect will last in the future remains an open question. ultimately, globalisation is an opportunity, not a threat. globalisation provides much - needed solutions. for instance, it may allow increased labour inflows to the euro area, which, in certain sectors, would help to reduce bottlenecks in labour markets and hence ease wage pressures. in addition, globalisation may supply external capital in exchange of know - how. as a matter of fact, the euro area has become an attractive place for foreign direct investment ( fdi ). a breakdown of extra - euro area liabilities indeed reveals that inward fdi amounts to more than 27 % of euro area gdp, against 22. 5 % for the united states. the euro area has received, proportionally to gdp, a similar amount of fdi as china, 27. 3 % for both economies, according to imf statistics. a rising amount of fdi comes from the so - called bric group – including brazil, russia, india and china. in fact, contrary to what such protectionist thinking would suggest, eu integration and the adoption of the euro seem to make europe fitter for globalisation. the single currency has supported the development and diversification of exports in the euro area countries, as mentioned earlier. the euro has also made a significant contribution to

of the world. with respect to central counterparties, i would like to mention four major developments : a ) consolidation of central counterparties since the start of emu, the number of central counterparties for financial instruments has fallen from 14 to 7 in the euro area. this process of consolidation may have a positive impact on financial stability as larger central counterparties may find it easier to diversify risks. it may also have a positive impact on the efficiency of post - trading arrangements due to network effects and issues related to interoperability. however, the failure of large central counterparties could have an even more disastrous impact on financial markets. moreover, consolidation may eventually lead to a reduction in competitive pressures with a negative impact on efficiency. the eurosystem has formulated this position in a policy statement on consolidation in central counterparty clearing, which was published as early as september 2001. as stated in the policy statement, the ecb supports any form of market - led integration or consolidation process that fulfils the ecb ’ s requirements in terms of financial stability, open access, price transparency and efficiency. b ) expansion of activities of central counterparties while in the past, most european central counterparties only cleared derivatives, many of them also now clear securities transactions. the effects of such an expanssion have been differently assessed by different speakers at this conference. on the one hand, john jackson and mark manning found that central counterparties that diversify their activities across imperfectly correlated assets may often be able to better manage their risks than single - product clearers. at the same time, securities market participants benefit as their exposure to counterparty credit risk is reduced. this trend towards multiproduct central counterparties could therefore be beneficial from a financial stability perspective. on the other hand, diana chan mentioned in the first panel yesterday, that central counterparts that diversify their activities across imperfectly correlated assets and reduce the collateral requirements for their participants by offsetting margins related to these different activities could. significantly underestimate risk exposure and collateralisation requirements, thereby create additional and unknown risks. these developments need therefore to be carefully observed by market participants and relevant authorities. c ) creation and dismantling of vertical “ silos ” in europe, vertical silos encompassing trading, clearing and settlement infrastructures have been created, while other silos have been dismantled. the discussion on which structure is preferable is ongoing, and the answer may be different for different markets. while silos may help infrastructure providers to reduce