Assuming, then, that one of our countries were to go back to pre-euro times – a scenario I see as very unlikely – there would be a heavy price to pay in terms of the financing of public debt, as well as household and corporate debt. For Italy, it would ultimately mean an increase of more than EUR 70 billion a year in the government’s debt servicing cost, which is more than the country’s total education budget. Our citizens are therefore strongly attached to the single currency: today, 61% of Italians and 70% of French people support the euro.2 And it is this broad-spread, popular support that is one of the euro’s greatest achievements. 2/5  BIS central bankers' speeches  3/ The last two reasons relate to the very nature of the unique system that unites the 19 euro area countries: monetary policy is shared; all other economic policies are decentralised. Let’s start with our monetary policy: the Eurosystem’s commitment since the 2011 crisis has been decisive in reducing fragmentation between euro area countries. [slide] Interest rates have fallen further in Italy than anywhere else – for firms, households and the government – and Italian banks have received more liquidity than those in other countries. This has led some to argue that our monetary policy is now being conducted for the benefit of Italy: they’re wrong. Monetary policy is not conducted for any one country, be it Germany, France or Italy.
In total, nearly a quarter of 18 to 24 yearolds in Italy and 19% in France are NEETS (Not in Employment, Education or Training) – well above the OECD average of 14%. Therefore, we have no greater priority today than developing skills, apprenticeships and professional training. As well as this need for the right reforms in our two countries, the decentralisation of the euro area has another consequence: we need a more symmetrical adjustment, with wage increases and fiscal stimulus in those countries that have the room to manoeuvre, such as Germany and the Netherlands. Fortunately, this process has already begun, with the fiscal plans set out by the coalition governments elected in 2017, and the pick-up in wage growth as these countries get nearer to full employment. The excessive external surpluses in the euro area are also a sign of poor resource allocation. The Macroeconomic Imbalance Procedure carried out by the European Commission must therefore be symmetrical. 3/5  BIS central bankers' speeches  II. To construct a more solidarity-based euro area, we need an Italy that is committed. At the same time, the euro area also needs to be improved: although Monetary Union is a success, the weaknesses of the Economic Union continue to pose a problem. We need to find a “tightrope” that combines responsibility and solidarity. Since Meseberg last June, France and Germany have put forward some initial proposals.