and perseverance are needed. effective poverty reduction requires that the recipient countries receive consistent support from donor countries, international financial institutions ( ifis ), and un organizations to help them pursue the right policies unswervingly for very long periods. angus maddison, the world economy : a millennial perspective, oecd 2001. james boughton, who ’ s in charge? ownership and conditionality in imf - supported programs, imf working paper wp / 03 / 191. i believe that if we follow through with the elements i have outlined, developing countries stand a reasonable chance to eradicate poverty. therefore, i do not think it is productive to constantly start new initiatives to fight poverty, which i also judge to be a sign that the involved parties are not willing to live up to their responsibilities. poverty will only be eradicated by economic growth, which also depends on integrating in particular african countries into the world economy and offering them fair and equitable access to markets in developed countries. trade is one of the best forms of self - help. therefore, it was very disappointing that the multilateral trade talks in cancun failed a few weeks ago. however, at the annual meetings of the imf and the world bank in dubai, there was a general consensus that the parties have to return to the negotiation table as soon as possible. ladies and gentlemen : next to the fight against poverty, i perceive the strengthening of the international financial architecture as a major challenge. since the asian crisis, the international financial system has undergone significant reform. an important outcome of these reforms has been the relative resilience of international financial markets to a series of shocks over the past three years : owing to the decisive intervention and cooperation of the federal reserve system and the eurosystem, september 11 did not produce a major financial crisis, the synchronised economic slowdown of major industrial countries has not led to any major stress in the financial system, and the financial meltdown in argentina did not entail any significant contagion except on uruguay, which proves that financial market agents may be pricing risk better and have become more discriminating without falling into irrational herding behavior. i see that particular progress has been made on three fronts : first, the international dialogue has been broadened and has been made more inclusive. the committees of the bis as well as the creation of the g - 20 have enabled emerging market countries ( emcs ) as well as developing countries to get involved in the

indicator of the progress already made in the integration of euro area stock markets. the euro area capital market is larger and more open than any of the domestic markets and provides investors with more varied opportunities for investment, but it is not yet fully integrated. there are still some barriers : for example different traditions and local market practices, national regulations and tax regimes. one major obstacle to the efficient functioning of financial markets is also the prevailing segmentation of financial markets in europe. so, while the introduction of the single currency was a major step towards integration, the high degree of segmentation in europe ’ s securities markets remains one of the primary reasons for structural weaknesses. allow me to illustrate this by providing an example : there are currently more than 20 different securities settlement systems in the euro area operating on different trading and clearing platforms. in other words, the euro area lacks a sufficiently integrated system for the clearing and settlement of securities and for managing collateral at the cross - border level. but market pressure is growing and the securities settlement systems are faced with increasing demands for consolidation. … the euro, in tandem with technological progress and continuing globalization, has put more pressure on european exchanges to strive for structural improvements. we should also be aware that the process of consolidation of stock exchanges is taking place within the context of the integration of capital markets in the euro area. this allows exchanges to benefit from increased economies of scope and scale they may obtain by using new information and telecommunication technologies. since the introduction of the euro several initiatives have been launched by stock exchanges with a view to forming alliances or merging activities. the recent flurry of excitement about the future of the london stock exchange gives an indication of just how important the push to consolidate europe ’ s stock exchanges has become. the increase in m & a activity is a sign of the competition between business and financial locations due to changing market conditions and the increasing competitive pressures to which the different financial intermediaries are exposed. further efforts must be undertaken to remove the remaining segmentation and harmonize market architectures, accounting rules and tax treatment. several initiatives are already under way and progress is being made on the harmonization of market practices ; here, eg the “ financial market action plan ” of the european commission comes to mind, and national governments and european market organizations have been working towards these goals. an important recent initiative was the decision of the ecofin - council to establish a committee of wise men in order to identify the obstacles which stand in the way of a single market in securities and consider