lower and with ageing populations, significant emigration and decreasing investment rates, focus has turned to structural reforms and institutional quality. labour and product market liberalisation, or business friendly environments almost became mantras of central bankers in their communication with governments and the broader public. european institutions have started to stress the importance of the quality of the institutions. and not only their quality, of course. yesterday morning i spoke in croatia about the need to improve the efficiency of the judicial system. it is fair to say that many reforms have already been undertaken across europe and that many countries are now seeing the benefits of such policies. for the last couple of quarters, every new gdp data release by eurostat has been a positive surprise, while forecasters have been raising their gdp forecast for the ea and the eu. however, while growth has resumed in all countries, medium - term growth potential in the region is insufficient to ensure pre - crisis pace of real convergence. namely, for convergence to be sustainable, long - term potential per capita growth must be consistent with an expansion of demand. in other words, gdp growth that results from strong capital inflow, foreign demand shock, or fall in interest rates due to perhaps euro area enlargement process, could prove to be unsustainable. so, the question is, did we take convergence for granted? was one of the great features of the european integration process only a temporary and unsustainable phenomenon related to the initial'low - hanging fruit'reforms that corrected vast resource misallocation problems, followed by a huge inflow of foreign capital before the crisis? will convergence return back to a faster speed, will it continue at a slower speed, or maybe even stop or reverse? is convergence still here and, even more importantly, is it here to stay? well, as it has been shown already at this conference, convergence is still present but it has slowed down compared to the pre - crisis period. of course, having said that, we have to keep in mind that cee has come a long way since the beginning of the transition. our progress has been tremendous. if we go back to 1995, the average level of income per capita in cesee countries was below 40 % of the old europe ’ s income ( in pps terms ). by 2008 it increased by a half and reached 60 % of the eu15 level of income. and in some regions, like the baltics, developments were even more spectacular with relative income per capita doubling in

like this awards program, the microfinance industry in the philippines also continues to evolve, grow and break new grounds. at the bangko sentral, the challenge is for us be responsive to the changing demands of the industry, specifically in areas of policy, supervision and regulation. last year, for instance, the bangko sentral approved the micro - agri product ( map ) to address the financing needs of small farmers. under this program, banks with microfinance operations are allowed to extend credit to clients with small agricultural activities using microfinance methodologies. in effect, these micro - agri loans are given the same regulatory treatment as microfinance loans, including the no - collateral provision. nevertheless, while the bangko sentral is open to innovations, it continues to be prudent as the agriculture sector has its own unique intricacies and risk profile. accordingly, we have set in place certain parameters to ensure that risks associated with agriculture finance are properly managed. there is also growing interest in providing housing microfinance and even micro - insurance, using microfinance methodologies and technologies. for instance, one of the country ’ s leading microfinance institutions – the center for agriculture and rural development or card – has formed a mutual benefit association which offers micro - insurance to over 300, 000 clients. this is yet another tool that minimizes vulnerabilities from poverty. i have been informed that the insurance commission has recognized card for its significant contribution in increasing the number of insured filipinos. in addition to product development, the microfinance industry is also working on more efficient delivery channels to lower costs and increase its reach. one delivery channel that is gaining much interest is the use of mobile phones for selected microfinance transactions. through electronic cash platforms – such as smart money and globe g cash – mobile phones are able to make payments and transfers, send remittances, or make purchases. this bears much potential for a country like ours … where the mobile phone sector serves practically all income groups and where the number of mobile phone users and usage are among the highest in the world. new technologies present a unique opportunity to reach a wide range of clients including the lower income segments of our population, who are traditionally marginalized and “ unbanked. ” for instance, the rural bankers association of the philippines - microenterprise access to business services ( rbapmabs ) has a joint project with globe telecom to provide banking services using the g