has been made with respect to resolving npls, and a comprehensive action plan to deal with legacy asset quality issues was adopted by the council of the european union and is now being followed up by eu and national authorities. the ecb has published guidance to banks on npls and a draft addendum, currently subject to public consultation. with respect to financial stability, we observe that at the current stage the euro area ’ s position in the financial cycle is consistent with the ongoing economic recovery. there are no indications of widespread asset price misalignments and credit developments remain modest. nevertheless, relatively buoyant real estate dynamics and high household debt levels in some countries warrant careful monitoring. we expect the national macroprudential authorities in the euro area to remain vigilant and ready to use the macroprudential policy instruments at their disposal to counteract the any emerging risks when necessary. within its macroprudential mandate, the ecb will contribute to this end. despite the potential for monetary policy to influence economic growth in the short term, strong, sustainable and balanced growth requires other policymakers to assume their responsibilities. from a global perspective, one of the key ingredients for raising potential growth and productivity is openness. open trade, investment and sustainable financial flows play a key role in the crossborder diffusion of new technologies that drive forward efficiency improvements. preserving openness is thus key to strengthening global growth potential. it should be underpinned by effective multilateral cooperation, including in the field of financial regulation and supervision. as regards the euro area, strengthening its long - term growth potential calls for decisive action to address the remaining structural issues. reform implementation needs to be substantially stepped up, with further actions to improve the business and regulatory environment aimed at boosting investment and increasing productivity. labour market rigidities need to be reduced further to enhance job creation and reduce unemployment, especially for young people. to foster reform implementation at country level, a full and consistent application of the eu ’ s policy framework is required, including the european semester and the macroeconomic imbalance procedure. likewise, full and consistent implementation of the stability and growth pact remains crucial to ensure confidence in the eu ’ s fiscal framework and to safeguard public debt sustainability. in the current environment, a broadly neutral euro area fiscal stance strikes an appropriate balance between aggregate stabilisation and sustainability needs. although such a euro area stance is prevailing, the contribution of individual member states to the aggregate outcome is suboptimal. some of them

need to take additional measures to ensure compliance with the fiscal rules, while others have scope to use available fiscal space. in addition, all euro area countries should strive for a more growth - friendly composition of fiscal policies by prioritising public investment and reducing the tax burden on labour. the current political and economic momentum in europe also provides an opportunity to strengthen our economic and monetary union ( emu ). further integration needs to be achieved 2 / 3 bis central bankers'speeches above all by implementing what has been agreed and by completing the common projects we have started. this includes completing the banking union and building a capital markets union. a more complete emu, with further steps towards a deeper financial, fiscal and economic union, will be the foundation for a stable, flourishing and resilient euro area economy. that is the best contribution which europe can make to global economic growth and financial stability. by delivering on its mandate, the ecb will continue to play its part in this endeavour. 3 / 3 bis central bankers'speeches