economy. therefore, there is an intimate relationship between capital on one hand, and economic development on the other. in order to promote economic growth, financial institutions have the primary responsibility of ensuring that capital is allocated to the most productive projects which assure the highest return possible. thus, the main mechanisms of growth stem from the improvements in the functioning of financial markets, and the effect this has on transforming risks and maturity of assets and liabilities of which capital markets development plays an important role. ladies and gentlemen, even as the private sector takes centre stage in this process, the government also has an important role to play. the absence of government means that financial markets operate without proper regulatory structures. without a formally regulated financial system, informal financial markets tend to fill in the gap but at sub - optimal levels with high transactions and other related costs. as a result, there is less efficient allocation of capital which in turn translates into low levels of economic growth as investment funding is limited by the cost of transactions. therefore, efficient capital allocation relies chiefly on a properly functioning financial system, which enables firms and households to share risks and also facilitates the transformation of more liquid liabilities into illiquid but productive investments. instruments and the structure of capital markets distinguished ladies and gentlemen : looking at the objective of every economy, it is clear that all countries develop the depth and breadth of their financial markets to meet the needs of the real economy. this includes making a wide range of choices available to investors and issuers of securities in fixed - income and equity markets. bond issuers, for example, would ideally be able to issue a variety of maturities with both variable and fixed rates. money markets : the market for securities of less than one year includes government and central bank bills, repurchase agreements of government paper ( repos ), commercial bank certificates of deposit, corporate commercial paper and trade finance instruments such as bankers ’ acceptances. these markets, in their inter - bank or over - the - counter ( otc ) form, have been in existence for a long time in many countries. a newer phenomenon, however, has been for these instruments to be listed on organized stock exchanges and for central banks to increasingly conduct monetary policy through open market operations in these instruments. ladies and gentlemen, in developing economies debt markets which include public entities ( ministries of finance, central banks and specialized government agencies for housing, agriculture, export and industry ), are the most creditworthy borrowers and generally dominate the issue of local currency debt.

across europe, is evidence of the widespread support in the market for the project. not only have the csds of all euro area countries signed the memorandum of understanding, but also the csds of seven eu countries outside the euro area – denmark, estonia, latvia, lithuania, romania, sweden and the uk – and two csds from countries outside the eu – iceland and switzerland. furthermore, the csds of denmark, lithuania and sweden have – with the consent of their central bank and with the support of their markets – also confirmed their intention to provide for settlement of their national currency in t2s, in addition to settlements in euro. we are grateful for the support of the csds and market participants more widely. this support has helped us to define a product which is fully in line with market needs. i am aware that it translated through all levels of the institutions – political as well as operational levels – and it has generated a momentum which makes me confident that we will also achieve the future milestones of the t2s project in good time. in the coming months, many of the key decisions will have to be made in preparation for the start of the development phase of the project which is scheduled for early next year. the signing of the memorandum of understanding will therefore pave the way for these decisions. we will need to discuss not only the governance of the platform and the contractual relations between the eurosystem and the csds, but also of course the pricing structure. i am confident that the discussions will be as diverse and fruitful as they have been so far, and that today marks another important milestone for the success of t2s project. thank you for your attention.