issued in larger volumes and are placed internationally. there are three developments which increase the german bond markets ’ attractiveness for both issuers and investors : · a higher turnover and therefore increased liquidity, · many new issuances and therefore more opportunities to diversify, and · a wider range of products, and therefore more chances to satisfy the needs of investors. vii as in the bond markets, investors in the equity markets have shifted their perspective from country benchmarks to pan - european sector benchmarks. european equity markets are still small compared with those in the usa. the market capitalisation of domestic shares, as a ratio of gdp, reaches about 90 per cent. the matching figures for the usa and japan are 152 per cent and 68 per cent, respectively. however, equity markets in the euro area are growing fast. the ratio of new issuance to market capitalisation averages over 4 per cent. this is twice as much as has been achieved in the usa or japan. germany has outperformed within the euro area in terms of the number of listed companies, of new stock issues, and of market capitalisation. the most impressive feature, however, is the ongoing growth of the capital markets and the potential to continue growing. market capitalisation as a ratio to gdp in germany is about 60 per cent. this reflects our bankdominated financial system. however, market capitalisation of domestic stocks grew over the last decade by 17 per cent per year. the turnover growth of the german equity markets is also reflected in a rising importance of investment funds and their assets. in germany some 6, 800 funds manage assets of more than 800 billion euro. over the last decade the number of funds almost tripled, while their assets rose by 18 per cent per year. the german capital market has been able to provide the bulk of start - up financing in europe. more than 200 venture capital companies operate in our country. they serve as a catalyst for new companies and – in the event of success – as a pacemaker for initial public offerings ( ipos ), especially on the “ neuer markt ”, which is the high - tech and innovative segment of the german stock exchange. germany benefits from a high degree of international attractiveness of its capital markets. about 235 foreign companies have their stocks listed in germany, a number which is topped only by the usa and the uk. germany is, of course, among the leading centres for central and east european business. in comparison to equity markets of other leading

jorgovanka tabakovic : financial system and economy – responses to the challenges of the crisis inaugural speech by ms jorgovanka tabakovic, governor of the national bank of serbia, at the conference “ financial system and economy – responses to the challenges of the crisis ”, belgrade, 2 november 2012. * * * ladies and gentlemen, the on - going sovereign debt crisis in the euro area, most acute in central and eastern europe has shown that no country can remain an isolated island in a global environment of strong economic and financial ties. the adverse effects of the sovereign debt crisis in euro area countries spilled over to the region of central and eastern europe, mainly via dampened external demand, the consequent weakening of economic activity and smaller inflow of foreign direct investments. this went hand in hand with limited access to foreign sources of funding, as country risk premiums and costs of borrowing went up. in an environment of shrinking foreign capital inflows and exports - generated inflow of foreign exchange, the first line of defence against the crisis is the maintenance and improvement of competitiveness. the price aspect of competitiveness can be improved via exchange rate or by restrictive income policy. the managed floating exchange rate regime significantly buffered the external shock which serbia experienced in the last quarter of 2008, when the first wave of the global financial crisis spilled over to our country. in 2009, compared to other countries in central and eastern europe, serbia ’ s gdp shrunk the least ( 3. 5 % ). at the same time, countries running the fixed exchange rate regime suffered greater economic turbulences. for example, the baltic countries estonia and lithuania had to resort to adjustments through wage reductions, ending the year with a 15 % fall in gdp. as for serbia, the flexible exchange rate regime also paved the way out of the crisis. on the one hand, the adjustment did not have to take place through sudden and drastic wage reductions and on the other, net exports gave a positive contribution to gdp growth. in this way, the dinar exchange rate was also the “ engine ” of serbia ’ s subsequent recovery, which will facilitate our shift to a new, sustainable model of investment - and exports - driven economic growth. it is true that apart from numerous positive effects, the depreciation may also have a negative bearing on financial stability, especially in countries with a substantial share of external and domestic debt in foreign currency or foreign - currency indexed, and in highly euroised economies such as