way. the european economy is coming back and recovering from the recession. but monetary policy cannot create long - term growth. long - term growth will be driven by productivity gains, well - functioning economies and a reformed economic and monetary union. it is the responsibility of the democratically elected governments to propose and implement the right reforms. mario draghi has insisted in his press conferences that fiscal policy and structural policy are also important, yet some european countries still continue to pursue austerity. could you tell us your opinion on that? as regards fiscal policy, the discussion in the g7 should not just be about increasing spending, it should also be about improving the quality of the budget. the ecb agrees with the idea that “ countries that have fiscal space should use it ”, but many countries do not have this fiscal space. reducing unproductive expenditures and cutting taxes or increasing bis central bankers ’ speeches investment in productive infrastructure, such as education and research, can lead to growth without increasing the deficit. what about foreign exchange policy? the uk pound and japanese yen have been increasing and volatility is very high. what will the g7 do to reduce volatility? the g20 countries have committed not to use the exchange rate for competitive purposes, as confirmed in recent meetings in shanghai and washington. all of us should act in a way consistent with this commitment and which does not add to global uncertainty. emerging markets are slowing down and advanced countries have very low growth rates. what should the g7 and advanced countries do for the world economy? in a low - growth environment globally, there might be a temptation for some countries to grow at the expense of other partner countries. so it is precisely the role of the g7 or the g20 to resist such temptation. there is no “ magic bullet ” for increasing growth. for the g7, it is crucial to send the message to support domestic demand and focus on those structural policies that will be most conducive to growth. you cannot just rely on other countries. the message that we would like to hear is that “ growth starts at home ”. bis central bankers ’ speeches

had and have to say was perhaps often predictable, but more often than not your saying it lent it weight and inspired confidence. moreover, what you once aptly said is absolutely true : “ man kann schone sonntagsreden halten. die entscheidungen fallen an werktagen. ” you are known to be a hard worker - some would even say a workaholic and you have tremendous “ ausdauer ”. you never get tired of putting your analysis and convictions across, as has again been demonstrated tonight. we owe you a great deal of gratitude. after august we central bankers will miss you as a colleague, although i believe we have internalised your basic principles. they will therefore still be around as if you are still present yourself. and should we tend to forget them, i am sure that ernst welteke will help me to remind other colleagues of them. sometimes, i wish that we could do the same as they do in the world of sport in the united states. there, when an outstanding player retires, in order to honour him the number he wears on the back of his shirt is never again used by another player. central bankers do not wear shirts with numbers on the back, but if we did, i am sure that we would withdraw your number. retirement is the natural end of one ’ s career, but it should not be overdramatised. people do matter - and you have certainly shown that - but institutions generally outlast them. in fact, that is what many people work for. luckily, i am convinced that this is the case in central banking. so, the institutions that you have worked to build will go on. meanwhile, as i look ahead to august, i know that while i will lose a colleague, i will still have the same friend. i know that is true for many of us here this evening. i should therefore like to close by simply expressing my thanks for your support over the years both as a colleague and a friend.