task is an arduous one but not impossible if we believe that, though it is very difficult, we are capable of changing and reforming. this is why i shall begin my speech with an optimistic message, offering you some examples showing how spain has already progressed with some adjustments and has undertaken major reforms during the difficult times we have faced during these years of crisis. i ’ m aware of the risk being run in showing optimism amid the crisis, in the same way that during the bubble whoever dared denounce the imbalances being built up was called a killjoy. but i hope my optimism is qualified by my reminder that complacency, that is to say believing that we have already done everything that has to be done and that nobody can teach us any lessons, is the arch - enemy in the battle to exit the crisis. to earn the confidence provided by the knowledge that spain has been capable of adjusting and reforming during these years of crisis, i have chosen two examples. first, the rapid improvement in our current - account balance ; and second, the headway during these years in restructuring our banking system. bis central bankers ’ speeches as is well known, under normal conditions the current - account balance is very easy to finance in a monetary union, but its size is a good indicator of two of the deepest imbalances that came about in spain during the expansionary phase : the explosion in debt and the loss of competitiveness. indeed, from 1996 credit began to outpace gross domestic product, doing so systematically until 2006, when its annual growth peaked : at a rate of over 25 % for total credit, and more than 40 % for credit extended to real estate development activities. over the same period, spanish cpi growth was systematically higher than that of the euro area. although the growth rate of credit began to fall as from 2006, growing debt and the loss of competitiveness over the 12 years to 2008 led the external imbalance to an unsustainable position, with a current - account deficit of 10 % of gdp and a strong increase in spain ’ s external debt. but what counts is that spain has since adjusted its current - account deficit at a spectacular pace. from almost 10 % in 2008, the deficit fell at the end of last year to 3. 7 % – an adjustment of more than 6 pp of gdp in three years – and at the end of 2012 we might already be in balance. the climate of pessimism accompanying the crises leads some to under

benefited the euro area's economy, acting – as formulated in the title of my speech – as a catalyst for integration and competition. a single currency for a single market a natural starting point for my topic today is the adoption of the single market programme in 1985, paving the way for the famous four " liberties " established in the european treaties : the free movement of goods, services, labour and capital. after the adoption of the single market programme, it became increasingly clear that the potential of the internal market could not be fully exploited while the relatively high transaction costs linked to currency conversion and the uncertainties associated with exchange - rate fluctuations persisted. indeed, the single currency should be seen as a necessary complement or, in fact, the crowning achievement of the single market. that said, we have not reached the end of the development of the single market. instead, i see the euro as facilitating further economic integration. for example, countries with the same currency tend to trade more with each other than they would with countries with different currencies. in addition, a single currency fosters the formation of a single financial system. by increasing price transparency, reducing transaction costs and fostering competition, the euro acts as a powerful catalyst to the economic integration process in the euro area. last, but not least, our common currency is also a powerful symbol for all citizens of the euro area that integration has reached a new level. as we approach the first summer holiday season since the introduction of euro notes and coins, increasing numbers of people in europe will, themselves, experience the practical advantages of a single currency. the impetus the euro gives to economic integration and growth should not only be regarded as an opportunity for europe, but also as a necessity in a world of innovation and globalisation. over the last few decades, the world economy has become ever more integrated. we have witnessed a strong expansion of international trade and capital flows and an increase in competition. behind these changes there are several underlying factors. among the most important is rapid technological progress, leading to dramatic reductions in transportation costs and an unprecedented increase in information processing capabilities. policy measures have also supported the globalisation trend, with the loosening of restrictions to trade and the liberalisation of capital movements. this panorama shows that we live in a dynamic and competitive world, where the ability to innovate and adjust to changing economic circumstances has become even more important than before. in this respect, schumpeter's thoughts haven't lost anything of their