Mario Draghi: Sovereignty in a globalised world Speech by Mr Mario Draghi, President of the European Central Bank, on the award of Laurea honoris causa in law from Università degli Studi di Bologna, Bologna, 22 February 2019. * * * It is a great honour to be speaking here today at the University of Bologna. As Europe’s oldest university, it has been at the heart of education and learning in Europe for over 900 years. It has a long history of welcoming students from across the continent, including Thomas Beckett and Copernicus. Erasmus studied here in 1506, and the University of Bologna is today a leading participant in the student exchange programme that bears his name. The Erasmus Programme is one of the many examples of the benefits of the close cooperation within the European Union that enjoy widespread popularity. But we know that other elements of European integration are more contested today. At the root of this debate is the inherent tension between the clear gains of economic integration, and the cooperation that is necessary to bring it about, which can sometimes be politically difficult to achieve or explain. I would like to argue that, in many ways, this tension is illusory. Rather than taking away countries’ sovereignty, the EU offers them a way to regain it. This does not mean we need the EU for everything. But in the face of globalisation, the EU is more relevant than ever today.
[3]John Locke, An Essay concerning the true original, extent and end of civil Government, 1690. [4]UNCTAD (2018), World Investment Report 2018: Investment and New Industrial Policies. [5]There is some debate as to whether technology will evolve in the future in ways that make  global value chains less important. Technologies such as 3D printing or robotics could allow the local production of many more goods. Some scholars find that technological change has so far only mildly slowed offshoring, while others see a more significant reversal ahead. See Koen De Backer, K., Menon, C. Desnoyers-James, I. and Moussiegt, L. (2016), “Reshoring: Myth or Reality?”, OECD Science, Technology and Industry Policy Papers, No 27, OECD Publishing; and Baldwin, R. (2016), The Great Convergence: Information Technology and the New Globalization, Harvard University Press. [6] 8 / 10  BIS central bankers' speeches  [6]OECD (2018), OECD Economic Outlook, Volume 2018, Issue 1, Chapter 2. [7]in ‘t Veld, J. (2019), “Quantifying the Economic Effects of the Single Market in a Structural  Macromodel”, European Economy Discussion Paper, No 094, European Commission, February. [8]This scenario assumes a counterfactual in which trade reverts to WTO-rules, and applies  Most Favoured Nation (MFN) rates as tariffs on goods. For non-tariff barriers, it relies on estimates calculated for trade between the EU and the US. See in ‘t Veld, J. (2019), op. cit. [9]As measured by PPP-adjusted GDP. [10]Excluding intra-EU trade. [11]For further details, see ECB (2015), The international role of the euro, Frankfurt am Main, July.