policy regimes – starting with the design of monetary policies, continuing with the way they are anchored and the building of due capacities for a greater effectiveness of monetary policy in the future. that is why we agreed to put in place today ’ s workshop, as part of a continuing process of reflection and reform. in our discussions here in tirana, we will begin with questions of policy design, which are fundamental to set the stage for the later topics we will come to. we have suggested in advance several questions that may help stimulate the discussion, covering some of the key questions that are certainly left in my mind, as a practitioner, after navigating through the crisis so far. the issues of policy design include the questions how much room for manoeuvre there has been to use discretionary macro policy measures ; how far fiscal policy in future should build up a buffer against macro - financial risks ; how far national monetary and prudential regimes have been able to shield us from turbulence ; and whether we now see a need to attract new kinds of capital flow – perhaps to change the growth model in the region. this discussion of policy design will bring us to our second issue. it concerns the role of external anchors for monetary policy. one point of consensus in our washington meeting was that we need to revisit some aspects of this anchoring process, and the way it interfaces with countries ’ efforts to build up their own internal anchors over time. there are several questions about the future role of external and internal anchors. they include some reflection whether there is a need for more co - ordination and synergy between our policy dialogues with the imf and the commission ; how the commission ’ s fiscal surveillance ( through economic and fiscal programmes, pre - accession economic programmes, convergence programmes ) can be deepened and serve more as a commitment device ; how far there are lessons to learn about monetary anchors and prudential coordination mechanisms for the eu accession of our region ; and how we – including the external actors – can foster stronger domestic anchors in various forms, ranging from medium - term fiscal frameworks to more effective policy co - ordination mechanisms. finally, we will turn to the issue of capacity - building. this is a question on which we agreed, at this workshop, to already provide some operational input to the cef as it develops its work programme in this area. there is a long lead - time in the effectiveness of capacitybuilding, although fortunately the cef had already taken the initiative a few years ago to ramp

has benefited from a positive demographic position as a result of its young and vibrant labour force, but has suffered from continuous net migration towards more developed countries. while emigration has provided a steady flow of remittances and has eased labour market pressures, it has also drained the country of its highly skilled labour force. the latter might have long - term repercussions on innovation and can have implications on the so - far convergence progress realised. with that being said, let me now conclude. 3. towards a steady convergence path see countries are at risk of falling into ‘ a middle income trap ’. as such the economic systems need to be transformed, through carefully - designed and well - targeted policies that promote domestic innovation, modernise institutions, and cushion the effects of adverse demographics. it is clear that the load of reforms remains with the see countries authorities ’ themselves. a domestic ownership of reforms is of utmost importance for the democratic process and the ultimate success of convergence. however, while these policies need to be carried out regardless of external factors, eu integration has a fundamental importance on economic convergence dynamics. after the economic and financial crisis, appetite for further eu enlargement declined, due to waning popular support and shifting policy priorities towards reform. as the eu ’ s mood drifted away from enlargement and from further integration, countries relaxed their drive for reform. these developments coincided, or let me rather say, induced a stall in the convergence process in several see countries. as a final thought, the eu institutions themselves can facilitate this process further through : 2 / 3 bis central bankers'speeches providing transparent and objective eu integration guidelines ; emphasising the need of institutional convergence throughout this process ; continued monitoring and reporting on the progress of individual countries. on one hand, this will enhance the positive leverage of the eu integration process on the development of our countries and societies. on the other, it will increase the cost of noncompliance and possibly induce positive compliance competition amongst the countries in the region. thank you! 3 / 3 bis central bankers'speeches