##ctual analysis is inherently impossible, and i will not pretend to know the answer. but let me just say that we have been happy to sit out the storm within the euro area rather than outside it. the exchange rate is not a straightforward policy instrument. although in principle, it may support faster adjustment of real imbalances, experience has shown that it becomes difficult to control precisely when the challenges are greatest. in times of crisis, the exchange rate tends to respond to financial disturbances rather than to real imbalances and, more often than not, it becomes a constraint on policies rather than a useful adjustment channel. membership in the euro area eliminates one potential adjustment channel, but above all, it eliminates a major source of uncertainty at times when uncertainty is already high. we are glad to accept that trade - off. the final viewpoint to euro membership relates to the role of a small national central bank in the decision making process of a large currency union. decision making in the eurosystem : getting your voice heard this is one aspect of the single currency that is often misunderstood ; what actually is the role of national central banks in the ecb and in the eurosystem? over the past ten years we at the bank of finland have been asked often why the bank of finland still matters. isn ’ t everything decided in frankfurt? what is the role of national central banks? how do the ecb and eurosystem operate? as a result of the maastricht treaty and practices established over these ten years, the institutional structure of the eurosystem is carefully balanced. the hub remains relatively small in comparison to the spokes. in important ways, the eurosystem remains highly decentralised. all important decisions are taken by the governing council, which usually meets in frankfurt. a large majority of the council ( all but six members of the executive board ) are governors from national central banks. they sit around the table making decisions in their personal capacity as members of the governing council, not as representatives of their countries. they are fully independent in this role as are the members of the european commission or the european court of justice. but when each of them is also a head of a national central bank, it is clear that their staff is deeply involved in preparing all issues on the agenda of the governing council meetings. so when the governor takes off to frankfurt, he is thoroughly prepared and carrying loads of papers and briefing notes in his briefcase. the single currency has delivered many important benefits

2000, 32 %, of the total workforce in finland had achieved tertiary education, while the eu15 average was 24 %. educated labour force has fostered innovation and increased the innovation absorption capacity. supply of science and technology graduates has helped to maintain the salaries of researchers and engineers in the itc - cluster moderate, in spite of strong demand. strong current account and international diversification of investment portfolios the growth of the ict industry is reflected in the current account, which has been in surplus since 1994. the emergence of large current account surpluses is a marked difference with the past. besides competitive open sector and strong growth of exports, the current account surpluses reflect a rather subdued growth of domestic demand after the crisis of the early 1990s. the corporate sector adopted a more cautious investment policy line by reducing its debt exposure and increasing its buffer stocks. the general government sector has been in surplus for years. as a consequence of international diversification of investors'portfolios, non - residents'holdings of shares in the finnish stock exchange rose to over 70 % of the total market capitalisation in 2000. this greatly reduced the exposure of the finnish economy to the ict asset price bubble at the turn of the century, as the main ownership risks were born by foreign investors. prudent fiscal policy as to economic policies, after the crisis in the early 1990s there was a clear need to adopt policies which would be compatible with the free movement of capital across national borders. broad support has developed for stability oriented fiscal policy as a basis for more long - term stable economic development. in line with this, public finances were consolidated. in recent years fiscal policy has been effectively based on explicit policy rules such as spending limits covering the whole electoral term. as a result of prudent fiscal policies, the general government sector is in surplus. the surplus ratio is on the level of 2 – 3 % and is expected to remain so. established social dialogue established social dialogue has been helpful in the implementation of some reforms. recently a major pension reform was agreed between employees, employers and the government. in the reform, which has already been implemented, two early - retirement schemes were abolished. there will be a longevity coefficient linking pensions to life expectancy, and benefits will be calculated on the basis of the whole lifetime income and not the last working years only, as earlier. this has improved the stability of the financing of the pensions, but challenges still remain. collective wage agreements play a relatively prominent role in shaping the relationship between employee and