credibility of its analyses and for the effectiveness of its action. these are values to be preserved if the country is to continue to benefit from an authoritative voice with no vested interests. these have been the guiding principles of my mandate. the world after the crisis the economic policy response to the 2008 – 09 crisis was rapid, effective and coordinated internationally. support from budgetary policies and the injection of liquidity to sustain the markets were unprecedented. the collapse of the international financial system was averted. there are some lessons to be drawn from this crisis : the social safety net, which held, is bis central bankers ’ speeches essential ; bank failures must be managed ; international cooperation, indispensable during the emergency, remains so when reconstructing the system. in 2010 the global economy returned to growth at a rate of almost 5 per cent. in the emerging countries huge numbers of people are leaving poverty behind, even though this process is being held back by rising food prices. overall the financial system is gradually recovering. but the legacy of the recession is a heavy one. the most advanced economies, with the exception of germany, are struggling to return to the previous rates of growth ; the recovery is still too weak to reduce unemployment. in the emerging countries, with growth rates close to 10 per cent in some cases, signs of inflation are beginning to appear ; in several of these countries inflows of capital have reached the high levels prevailing before the crisis. the economic policies energetically applied in the advanced countries to counter the worst effects of the crisis have reached their limits. the public debt of these countries, equal to 73 per cent of gdp in 2007, will exceed 100 per cent this year. the risk premiums on public debt are growing everywhere, dramatically so in the economies where the public finances have deteriorated the most. in the euro area, the sovereign debt crisis of three countries – which together account for 6 per cent of the area ’ s gdp – can potentially have significant systemic effects. public finances must be brought under control. a prolonged expansionary policy undermines the sustainability of the debt and damages economic growth. in europe a start has been made on adjustment. this could not be postponed, despite the weakness of the recovery. the emerging economies ’ prompt return to growth, adverse climatic events and socio - political upheaval in the mediterranean and middle east have pushed up the prices of energy sources and food, by more than 30 per cent in the last six months. the risk of inflation is rising. there

public sector plays such a key role in fostering private sector initiatives. a historic example of this is the darpa project in the united states, which, since the 1960s, has paved the way for the development of the internet. 13 last but not least is the need to help european citizens understand that the high investment costs will be offset by equally high rewards. during this transition, it will be essential to protect the most vulnerable segments of the population, which might be more affected by the changes. this approach will be crucial to mitigate any social or political pushback and to strengthen public support for the eu project. 3. the role of public sector resources europe has been in an anomalous situation for years. on the one hand, some countries have very high levels of public debt – which is a significant problem for spain and even more so for italy. on the other hand, the european common debt is very low. the bulk of the eu ’ s public debt consists of funding for the nextgenerationeu ( ngeu ) programme. the funds under the recovery and resilience facility, the main instrument of the ngeu, amount to €650 billion ; a further €80 billion have been allocated to several existing programmes already included in the eu budget. however, the ngeu programme will end in 2026 and, from 2028 onwards, the outstanding volume of eu bonds will start to decrease, reaching nearly zero over the next three decades. within a given territory, public goods are non - rivalrous ( extending their use to everyone does not require additional costs ) and non - excludable ( it is not possible to restrict their use to those who have helped finance them ). the latter feature is at the root of free - rider problems, i. e., in our case, the incentive for a state to benefit from the efforts of others ( e. g. in the environmental field ) without making any efforts of its own. m. draghi, 2024, op. cit. in 1958, the united states founded the advanced research projects agency ( arpa ; later renamed defense arpa, or darpa ), with the aim of developing breakthrough military technology. in 1969, they launched arpanet, a computer network connecting arpa to a number of us universities. during the 1970s, the number of universities connected to the network grew and a new protocol was created to streamline and expedite communication between and among network computers, thereby laying the