pressure on prices. accordingly, the accommodative monetary policy stance of the ecb has supported and will continue to support real activity. nevertheless, it has to be acknowledged that monetary policy cannot do it alone. given how weak the economic performance of the euro area has been in the recent years, coupled with the limitations of monetary policy in what is called a “ liquidity trap ”, it is critical that supply - side reforms and fiscal policies contribute to improve the euro area ’ s growth prospects. supply - side reforms are vital because the long - term growth rate depends on the productivity of labour and capital. supply - side reforms can increase productivity, thereby lifting the potential growth rate. growth friendly reforms include policy actions to improve the business environment, to foster competition, to improve public infrastructure and education. policies that reduce structural unemployment and raise the labour force participation rate are also important deutsche bundesbank ( 2014 ) “ nothing new about negative real interest rates on deposits ” economic bulletin 2014 – 06 – 30. bis central bankers ’ speeches so that european firms make full use of the amount of labour available. demographic policies can play a role too, so that the supply of labour in europe can grow, rather than shrink, in the future. in recent years, much of the reform effort within the euro area appears to have taken place in the member states most adversely affected by the global financial crisis and its aftermath. the oecd recently assessed structural reform efforts and achievements since 2011. it classified estonia, greece, ireland, portugal and spain as the most successful reformers among all oecd members. 5 the netherlands and germany have been laggards in the oecd ranking, even if starting from comfortable positions. while supply - side reforms are desirable, their objective is typically growth in the long - run. as such, supply - side reforms normally take time to produce positive effects. furthermore, in the short - run, reforms can dampen aggregate expenditure, when they require costly adjustments up front, as has been recognised in the stability and growth pact. for this reason and amid a tepid recovery, it is important for member states ’ fiscal policy to be as accommodative as possible. fiscal policy and to some extent, income policy, have room for manoeuvre whenever an economy is running a current account surplus. this is the case for the euro area that currently has a surplus of 3percent of gdp and is projected to remain as such the next few years

. monetary authorities also play an important role in this process by conducting a credible policy which leads to price stability and thus creating an environment where entering into erm ii will be smooth and credible. most of the results presented here are broadly in line with the ecb ’ s view that eu enlargement has positive implications for economic growth and welfare in both the “ previous ” and “ new ” member states ; unfortunately, these benefits have often been set aside in the public debate. already the prospect of the countries joining the eu had positive implications. as trade and capital movements have been to a large extent liberalised well before accession, the degree of integration had already reached a significant level between the new and previous member states. in fact, at the eve of eu enlargement the euro area directed around 11 % of its total exports and imports to the new member states, an increase of almost 50 % in 10 years ; the 10 new member states as a group represent one of the main trading partners of the euro area, exceeding trade with japan by far ( 8 % ) and being only somewhat lower than the european trade with the united states ( 14 % ). similarly, the share of the eu - 15 total foreign direct investments that was orientated towards the new member states was also around 12 % and tripled since 1999. while these figures are still low compared to the fdi flows directed to the us, they are considerably higher compared to those flowing to japan. in addition, the prospect of eu enlargement has significantly sheltered the new member states from adverse spill - over effects coming from other emerging markets. with eu enlargement now in place, economic and financial integration will advance further. with the extension of the single market to the new member states all remaining barriers to trade and capital flows have been removed by now, thereby supporting further integration. it is already observable that small and medium - sized enterprises from the eu - 15 countries are becoming significantly more active in the new member states, as the economic and legal environment has become more stable upon accession. let me stress that enlargement has also led to higher competition in the eu and enhanced the scope for economies of scale following the increase in the market size. by this, productivity will rise, thereby contributing to an increase in the potential growth rate of the eu. it is important to note that also the “ previous ” 15 member states will be affected by higher competition in the eu, which could accelerate structural reforms in these countries. in fact