In this regard, to my opinion, CESEE may feel some stress impact during the process of reforms implementation which will come most likely from: –  deleveraging, in terms of lower “parent” support for liquidity and lending to local economy;  –  cross-jurisdictions similarity in economic and financial cyclicality;  –  cross-border cooperation in supervision;  –  possible capital movements and impact on exchange rate;  –  political process as, in SEE, the EU integration process is determinant;  Nevertheless, there is no option on “holding back” from the reforms for a long time, given the unstoppable process of financial integration and globalization. Hence, an early start of a pacing approach to financial regulatory reform is appropriate. BIS central bankers’ speeches  3  In the last part of my speech I would like to stop by on the impact on Albania’s financial sector and economy and possible ways to avoid/mitigate negative externalities. The features of our financial system are similar to those of other CESEEs. In fact: –  in Albania, the banking sector dominates the financial system;  –  banking activity is concentrated and controlled by foreign banks (87% of the assets);  –  in total there are 16 banks and the 4 biggest ones possess 68% of total assets. –  home countries are: Austria (1 bank), Greece (3), France (2), Italy (2), Turkey (1), Bulgaria (1).
Even though budget adjustments may curb economic growth in the immediate future, they will help ensure the sustainability of public finances and lower the risk premia of sovereign bonds. We must reverse the growth in debt burden and establish a framework which would support market confidence in the sustainability of public finance management in euro area countries. This is the common interest of all euro area Member States. 3. Alongside crisis management measures, we must lay emphasis on ensuring stability in the long perspective. To ensure an outlook for growth, we must implement structural reforms to enhance economic flexibility, competitiveness and employment. 4. The key task of the Eurosystem central banks, including Eesti Pank, is to ensure general price stability in the euro area. This should be the principle goal of monetary policy and the main mission of the central bank in its efforts to facilitate economic growth and create jobs. 2  BIS central bankers’ speeches  [CONCERNING ESTONIA] 1. Unlike several other euro area countries, Estonia had no need to engage in local crisis management in 2011. 2. The Estonian economy showed notable adjustment ability against the backdrop of the uncertain environment. Our annual economic growth (7.6%) was the fastest in the euro area. Moreover, the economic developments were far more balanced than before the crisis: the current account was in a moderate surplus and domestic price pressures remained subdued.