##es. last year, the primary surplus was 4. 2 % of gdp, outperforming the target of 0. 5 %. the current account during the last two years had effectively been in balance from a 15 % deficit eight years ago. at the same time, sweeping structural reforms have been implemented, covering the pensions system, the health system, labour markets, product markets, the business environment, public administration, etc. recapitalisation and restructuring have taken place in the banking system and significant institutional reforms have been initiated aiming at reducing the volume of npls. moreover, there is evidence that the economy has been undergoing a rebalancing towards tradable, export - oriented sector : the share of exports of goods and services in gdp increased from 19 % in 2009 to 28. 2 % in 2016, with most of the increase coming from exports of goods. 2. 3 recent economic and financial developments see appendix for an update on the macroeconomy and the banking sector. 3. bog proposal - a mild debt relief exercise see appendix for details. 4. major pending issues two quotes from the latest eurogroup statement ( 15. 06. 2017 ) : i ) “ the eurogroup stands ready to implement, without prejudice to the final dsa, extensions of the weighted average maturities ( wam ) and a further deferral of efsf interest and amortization by between 0 and 15 years. as agreed in may 2016, these measures shall not lead to additional costs for other beneficiary member states ”. ii ) “ in view of the ending of the current programme in august 2018, the eurogroup commits to 2 / 4 bis central bankers'speeches provide support for greece ’ s return to the market : the eurogroup agrees that future disbursements should cater not only for the need to clear arrears, but also to further build up cash buffers to support investor's confidence and facilitate market access ”. 4. 1 getting greece into qe the person speaking before you was the first greek economist to talk about the modalities and the benefits of getting greece into ecb ’ s qe programme, in october 2015 talking to international investors in new york, and the programme – let me remind you that the qe programme started in march 2015. president draghi, when asked about the eventuality of greece ’ s participation in the ecb ’ s qe programme [ on many occasions in fact, right after many governing

are reaping the benefits of that credibility. long term interest rates stand at a historically low level, around 100 basis points below the level in the united states. so, even after the recent increases in short term rates, monetary and financial conditions remain extremely favourable for investment and growth. and indeed, we might be witnessing in europe the start of period of sustained and stable growth, at least if current projections and surveys are proven to be right in the coming months. a third benefit of the euro is the boost it gives to financial integration in europe. in many segments, european financial markets have reached the depth and liquidity which, up to now, were the preserve of dollar markets. this stimulates productive investment, helps in restructuring ( as witnessed by the current wave of m & as ) and, more generally, allows a better allocation of savings and sharing of risks. as a consequence, the euro is becoming extremely attractive, as a vehicle, a transaction, an investment and a reserve currency. as you may know, as central bankers, we remain neutral as far as the internationalisation of the euro is concerned. we are neither encouraging, nor discouraging the process. but, as a citizen, i cannot help and feel proud of having one the two main currencies in the world. long term prospects looking into the future, i would like to try and answer four questions : is monetary integration sustainable in the long run? what are the prospects for the enlargement of the euro area? can the euro serve as a model for other regions in the world? and finally, is monetary union going to lead to further political integration in europe? solidity of the euro area i am aware that there still is, on this side of the atlantic, a lot of skepticism about the future for the euro. four years ago, one of your leading academics, ( martin feldstein ) wrote a piece in foreign affairs arguing that monetary union would reignite conflicts and war in europe. this is, of course, the extreme form of a basic argument : that there are too many divergences between european states for them to withstand the pressures of monetary unification. put in simple economic terms, it boils down to the argument that the euro is not an optimum currency area. in my view, this is less and less true. while european labor markets are not – and will never be – as integrated as in the united states, goods, services, and capital markets are now fully unified,