itself is lower than it was in 2003, although the cyclically adjusted deficit is close to 4 percent – higher than it was in 2003. since 2007, when the actual deficit was almost zero, the deficit has grown during the crisis, declined somewhat in 2010, and since then has not declined. the result is that we have a deficit of about 4 percent in a situation of almost full employment. i feel very uneasy with this kind of deficit in the current situation, since if the economy enters a recession – a scenario which we must take into account – the deficit will grow, and it will be harder to deal with it. the debt - to - gdp ratio declined from a level of almost 300 percent of gdp prior to the stabilization plan, climbed slightly to a level of about 100 percent during the recession at the beginning of the 2000s, and continued to decline since then to a level of 74 percent today. compared to other countries, we have greatly improved in this parameter due to an increase in the debt levels of many countries as a result of the crisis, but it is very important for the state of israel that the debt to gdp ratio be low. we are exposed much more than other countries to geopolitical risks, and if god forbid we find ourselves one day in a conflict with our neighbors, near or far, it is important that we not come into it with this kind of debt ratio. it is very important, therefore, to continue reducing the debt to gdp ratio. in 2012, the government adjusted the deficit path such that the deficit targets would be reduced more slowly than planned beforehand. in practice, if we grow at an average rate of bis central bankers ’ speeches 3. 75 percent per year, the deficit will decline even more slowly than the path decided upon by the government, based on the existing tax rates in the existing legislation – that is, even taking into account the increase in the vat and direct tax rates recently enacted. according to this estimation by the bank of israel, the deficit in the coming year will apparently be 3. 5 percent, and will reach a level of 2 percent only in the year 2020. according to this projection, debt will also decline more slowly than the government estimated when setting the legislation. the fiscal rule which guides our actions is the result of a joint effort by the ministry of finance, the prime minister ’ s office, and the bank of israel. it is a relatively simple rule that can be easily explained to the public. we know that the expenses

edge risks of a hard brexit have been largely addressed. in addition to the preparations by individual firms, this has included the temporary permission by the european authorities for the uk central securities depository ( csd ) to continue to serve irish securities during the transition to an alternative eu27 csd arrangement. there are some remaining risks of consumer detriment. the irish and uk financial systems are closely connected, with uk firms and firms from gibraltar providing financial services to irish consumers, including insurance and payment services. we have worked with the european and uk authorities to ensure that those firms providing services to irish consumers are able to continue to do so in the event of a hard brexit. the vast majority of uk - based firms have taken appropriate action, but not all have to date. in this context, i am pleased that the central bank of ireland has worked with the department of finance to support the drafting of legislation to create a temporary run - off regime that will protect insurance customers in event of a no - deal brexit. in terms of financial stability risks, our assessment is that the improvements in the resilience of the financial system over the last decade provide a vitally - important buffer. taken together, the more balanced macroeconomic profile, the restructuring of the irish banking system, the muchhigher capital and liquidity ratios, the decline in the non - performing loan ratio and the more intrusive supervisory regime mean that the capacity to absorb negative shocks is much greater than in the past. conclusions while there remains much uncertainty about the final nature of brexit, the central bank of ireland ( and, more generally, the international central banking and regulatory community ) has been active since the calling of the referendum in preparing for the full range of brexit scenarios. our near - term focus is in ensuring that our contingency planning covers the unfolding situation, while continuing to work with those firms that have not yet finalised their brexit plans. regardless of the precise outcome, the intrinsic discontinuity represented by any form of brexit means that it is certain the 2020 edition of the european financial forum will be discussing a fundamentallydifferent european financial system compared to the system that has been in place for the last several decades. 1 see for example lane, philip r., ( 2019 ), climate change and the irish financial system, economic letter, vol. 2019, no. 1, central bank of ireland 3 / 3 bis central bankers