The result of this arrangement is the accumulation of arrears, a systemic problem created by the everlasting earmarking which monopolize resources and reduce the ability of the authorities to fully finance their priorities. The problems thereby created have negative implications for capital spending, private sector growth, stability of the banking system and hence overall economic growth.
Beyond a variety of discussions prompted by the global financial crises, we need to make further progress on this front. The second issue is economic and social consequences of sizeable demographic changes, such as a declining population and ageing. The third issue is repercussions of natural disasters on economic activity.