as a reserve and invoicing currency and its relevance as an issuing currency on the the ecb provides a useful survey of the multitude of approaches to regional economic cooperation in the world economy ( ecb monthly bulletin 10 / 2004 ). international bond market is confirming this judgment. it is important to emphasise that the internationalisation of the euro reflects a market driven process and is no goal of the common monetary policy. thus, the acceptance of the euro in international markets is even more reassuring. despite these overall achievements, some have recently cast their doubts on the future of monetary integration in europe in the face of heterogeneous developments at the level of member states. and here i can only repeat myself. this line of argument neglects the basic empirical facts. the divergence in national inflation rates and output growth rates has not increased with emu. nominal convergence has not lead to real divergence and the heterogeneity within emu is by no means significantly larger than in a well - established monetary union, ie the united states. and it should be borne in mind – and this is one of the important lessons for countries engaging in a monetary union – that there are several national adjustment mechanisms to deal with idiosyncratic developments in a monetary union. these range from labour mobility, to flexible prices and wages to intra - union shifts in competitiveness. arguably, the most favourable condition for a monetary union would be a far reaching structural homogeneity of participating countries. but some instances of heterogeneity can realistically never be dismissed, and should not be. otherwise the fruits of specialisation, comparative advantages and interregional risk - sharing cannot be earned in full. thus, what is of the essence is that the member states forming a monetary union have a clear awareness of the “ rules of the game ”. ladies and gentlemen, with regard to the important gcc initiative, these issues are highly relevant. currently, due to oil production there is a high degree of structural similarity between the gcc economies. but differences in the amount of oil reserves will mean that economic heterogeneity will certainly increase in the future. the structural homogeneity of gcc countries has been accompanied by significant monetary convergence. widely unnoticed these countries have managed intra - regional exchange rate stability, low inflation rates and co - moving interest rates in a narrow range. fiscal convergence seems to lack behind the developments at the monetary frontier. and here, too, emu experience shows the

to accommodate the worldwide process of automation of certain tasks, especially in a context in which the incidence of low - skills unemployment is high and the labour market is not flexible enough. the analysis of the banco de espana suggests that the higher possibilities for firms, in the presence of adverse shocks, to adjust wages and, in particular, hours worked, which were introduced through the 2012 labour market reform, led to a significant slowdown in job destruction flows, despite the adverse economic situation in 2012 and 2013. apparently, however, the reform has not been able to change either the structure of the collective bargaining system or the acute segmentation of the working population. these two features of the spanish labour market have been at the core of the high volatility of employment and the high level of unemployment and, therefore, should be at the core of the reform agenda in this area. raising medium - term growth prospects the third session will be devoted to the general question of how to improve medium - term growth prospects. spain ’ s potential output growth is estimated to be somewhat below 1. 5 % over the following decade, a level much lower than that of 3 % before the crisis. among the most important structural factors limiting spanish growth prospects are ageing of the population, a lower contribution of the participation rate now that many women have already been incorporated into the labour force, and a lower contribution of the stock of capital following the high growth recorded in the previous upturn. these factors are common to most developed countries. hence, the growth of the spanish economy will essentially rely on its capacity to raise low productivity growth. spain has a significant productivity gap with the euro area and recent research has related this gap to an inefficient reallocation of resources towards less productive firms during the expansionary period. however, since 2008 there has been an improvement in the reallocation of resources, especially due to the disappearance of many unproductive firms. but business mark - ups stand at relatively high and rising levels. this could indicate a persistent lack of competition in some markets, with adverse implications in terms of competitiveness, for instance, those regulations that distort the cost of production among firms or affect incentives to grow, such as market barriers due to the heterogeneity of regulations across regions. more generally, the spanish economy continues to exhibit a low productivity level in terms of the average firm, something that can be perhaps explained through different combinations of inadequate managerial skills and educational attainment of workers, as