Securing stability and growth in a post-crisis world

Having experienced the worst financial and economic crisis of the past decades, the international community embarked on an ambitious reform agenda to secure strong, sustainable and balanced growth in a post-crisis world The most prominent issues on this agenda are the reform of financial regulation and the problem of macroeconomic imbalances. With regard to regulatory reform, a major step has already been taken by drawing up the Basel III framework. Nevertheless, there are still unresolved issues, such as the detailed treatment of systemically important financial institutions and an adequate approach to the shadow banking system. Global macroeconomic imbalances have to be addressed because they not only reflect underlying barriers to sustainable growth but, in themselves, pose a threat to stability. On a regional level, the euro area, while recording a balanced account vis-a-vis the rest of the world, is marked by divergencies between member states, which place a strain on the monetary union. In both cases, a sensible policy approach has to focus on structural reforms to address the underlying causes instead of just the symptoms. Therefore, direct interventions, such as the attempt to steer current accounts or exchange rates within specific target zones, are not advisable.