a european productivity compact speech by fabio panetta * governor of banca d ’ italia 20th spain - italy dialogue forum ( arel - ceoe - sbees ) barcelona, 3 december 2024 introduction i am delighted to take part in this edition of the spain - italy dialogue forum which, since 1999, has provided a great opportunity for our two countries to exchange ideas and experiences. two countries united by the mediterranean, a sea so enchantingly evoked by the voice of joan manuel serrat. the history of italy is inextricably linked to that of spain. the same is true of their economies. our trade in goods and services totals over €73 billion : spain is italy ’ s fourth largest trading partner, italy is spain's third. spanish direct investment in italy and italian direct investment in spain amount to €14 billion and €46 billion, respectively. together, our two countries make up a significant part of the euro area. they account for 25 per cent of gdp, 23 per cent of industrial output and 17 per cent of euro - area exports. a staunch commitment to being part of the european endeavour has been a fundamental driver of economic development for both countries – for italy, which has been a member since the beginning, and for spain, which has been able to seize the opportunities offered by its more recent accession. however, the european economy is struggling to keep pace with the most dynamic countries, the united states above all ( figure 1. a ), mainly because of low productivity growth ( figure 1. b ). the fact that the european economy is losing ground is nothing new. the gap with the united states emerged at the end of the last century, with the spread of information and communication technologies, and subsequently widened with the digital revolution and, more recently, artificial intelligence. * my thanks go to antonella foglia, valentina memoli, roberto pisano, pietro rizza, anatoli segura velez, pietro tommasino, and stefania zotteri for their valuable research and contributions. figure 1 gdp growth and productivity gaps between the european union and the united states ( a ) real gdp ( index : 1991 = 100 ) ( b ) gdp per hour worked ( index : q1 1995 = 100 ) european union united states sources : for panel ( a ), imf. for panel ( b ), bureau of labor statistics and eurostat. ( 1 ) gdp per hour worked in the private sector. these three missed

mario draghi : the culture of monetary stability from unification to the present day address by mr mario draghi, governor of the bank of italy and chairman of the financial stability board, at the inauguration of the exhibition “ the currency of united italy : from lira to euro ”, palazzo delle esposizioni, rome, 4 april 2011. * * * the bank of italy is making a twofold contribution to the 150th anniversary of the unification of italy. with the collaboration of numerous experts from italy and abroad, it is sponsoring a vast research project – entitled italy and the world economy, 1861 – 2011 – on the italian economy ’ s response to the major changes in the international scenario that have taken place from the birth of the unified state to the present day. the results of this research will be presented at a conference in rome on 13, 14 and 15 october. for the wider public, and particularly for young people, we are inaugurating today the exhibition on the currency of united italy : from lira to euro. the thread that runs through the 150 years of italian monetary history since unification draws together two fundamental events : the country ’ s monetary unification, which the newly formed italy undertook in order to strengthen the foundations of its political unity ; and, closer to our time, italy ’ s participation in european monetary unification, achieved despite the lack of political unity. this story, from the lira to the euro, illustrates a central point for all of us today – the importance of monetary stability and of a political and economic culture that recognizes its value. guido carli suggested a logical path to take. “ if international competition ”, he wrote in 1961, “ is indeed the most powerful incentive towards our country ’ s economic development, there can be no doubt that, in turn, its strongest pillar is monetary stability. this, too, is a lesson handed down to us through a century of italy ’ s – sometimes painful – experiences as a nation state. ” 1 the concept of monetary stability changes with time, alongside the technological and institutional conditions that determine it. between the 19th and 20th centuries, italy, too, switched from a system in which money was made of, or could be converted into, precious metal to one based on purely fiat money. in the first system, monetary stability is ensured by maintaining the gold convertibility of the currency at a fixed parity. by and large, italy managed to do this : on the eve of the first world war, despite some