the need for a stability - oriented domestic monetary policy. this principle applies all the more to the current environment of elevated inflationary pressures and heightened financial market tensions. of course, i do not intend to invoke the impression that the globalisation of goods and financial markets has not altered price dynamics and transmission forces. to the contrary! but the bottom line of my arguments is, that globalisation ultimately raises the degree of uncertainty with which monetary policy decisions are taken. uncertainty, however, is something we are confronted with as policy makers on a almost daily basis. it asks for a robust monetary policy strategy. robustness in that context implies a broad analysis of monetary and economic indicators. but it also means a clear and wellknown strategic framework that puts price stability to the forefront. to put it in dylan ’ s words : globalisation certainly “ holds the wheel in spin ”. but it does not change the fundamental direction of a stability - oriented monetary policy, nor the need to take a medium - term view, because “ the times, they are a - changin ”. globalisation : basic remarks and characteristics let me start with some basic observations regarding globalisation. globalisation is a term referred to pretty often in the media, and by politicians and economists. however, there is no single definition of what globalisation actually means nor is there a single key figure for measuring its scale and evolution over time. to me, a useful starting - point is, quite fundamentally, the notion that globalisation describes the ongoing process of the international division of labour. in the wake of this process, the domestic markets for goods and services, as well as labour markets, are becoming more and more interlinked and interdependent internationally. in the absence of a single yardstick to gauge the extent to which globalisation is evolving, it is useful to look at various developments that, in combination, capture this process. let me just pick out two distinctive developments. first : the steadily rising volume of global trade, whose growth rate has been exceeding that of global gdp for a long time now. on average, global trade has grown 50 % faster than world gdp over the past 35 years. during the 1990s, global trade even grew twice as fast as global gdp. among the factors explaining this development are a number of developments which have particular relevance : more and more goods and services are becoming tradable. in addition, more companies and economies have become involved in foreign trade. let us briefly look at

sustainable financial architecture. markets are integrated and banks are global, while the supervisory authorities are national and the application of rules varies. supervisory authorities must be strengthened and adopt a uniform approach to banks, and regulations must be improved. there has been some competition between countries to establish national financial centres. this has had an impact on national supervisory authorities, who have therefore tended to be reluctant to impose stringent requirements on the banking sector. it is important to avoid slippage in the rules towards an agreed minimum level that is too low. for norway, it is essential that rules are applied stringently and uniformly in all the nordic countries since banks based in sweden and denmark have large market shares in norway and norwegian banks have ambitions in scandinavia. in recent years, there has been little cooperation across countries in the field of macroeconomic policy. the view has been that all is well as long as each country keeps its own house in order. this is an important point of departure, but we have now presumably learned that imbalances and risk arise when large countries do not sufficiently take into account that their own choices also influence those of others. the international monetary fund ( imf ) must be given a more important role. the fund must enhance its surveillance activities and its advice must be acted upon to a greater extent. however, this probably requires changes in the imf ’ s governance structure. countries that are now gaining in economic strength are seeking greater influence, and the imf must also improve its reputation in these countries. we have to ensure that the fund has sufficient resources to grant loans to member countries that are particularly hard hit by the financial crisis. the financial resources of the imf are being discussed at the g20 summit in london. the imf aims to double its lending capacity and has called on member countries to provide the necessary funding. several countries have responded positively, among them norway. the government has offered to make available a contribution of up to nok 30 billion to the imf, subject to approval by the storting. the us has asked for the nab 3 to be increased substantially. even a special one - time allocation of sdrs 4 to strengthen global liquidity may be considered. the government pension fund – global let me now turn to the government pension fund – global. international capital markets have been a boon to norway. we drew on borrowing opportunities abroad when the petroleum industry was being built up. we did the same in order to expand welfare schemes and to finance the countercyclical policy