The agenda of the Conference is designed to distinguish the elements of diagnosis which are still uncertain today (what will be the magnitude of the crisis in the Mediterranean?  By which channels it will pass?), the strategies and the institutional and financial means that can be mobilized to answer

The basic idea is that since 1995 a North-South agreement tries to make emerge the great Euro Mediterranean region as a zone of peace and shared prosperity. In any case, as a space where everyone has become aware of what binds him to others.

The UPM, launched on July13 2008, has revived a process of joint decision and regional co decision around concrete projects. Although the installation of its bodies is now slowed by the events occurred in the Middle East since December 2008, it is essential that it should be at the heart of a regional approach aiming at anticipating the effects of the crisis.

Opening Session: Overview of the economic crisis in the Mediterranean partner countries of Europe (PM)

At the moment when this program is developed, it is clear that the global crisis still has relatively mitigated effects (-3% of GDP growth) on the Mediterranean partner countries of Europe. That is due to the fact that banks are not exposed directly to the international crisis.  What could appear like a handicap, due to the existence of semi-fixed exchange rates, non-convertibility of the stock-account, weak investment portfolio and weak presence of foreign banks avoided them being implied in the systemic banking crisis.

Nevertheless, the shock of the crisis will appear during 2009 and 2010 with the global recession and, in particular the European. It is likely that the shock will eventually lead to difficulties in banks, will make more delicate the balance of public finances, will cause a drop in monetary reserves and will reach consumption, investment and employment.

The opening session will aim to enable the authorities represented and the international organizations to give their views on the situation of their country or region, to indicate how anticipations evolve and to present the policies implemented to facilitate the adjustment.

Session 1: What is the situation of the financial institutions in the Mediterranean countries (PM)

The financial crisis that has been the origin of the current global crisis does not threaten directly the Mediterranean countries. The indications that we have on the size of financial sectors dominated by banks on their liquidity and the level of intermediation currently seem not to raise difficulties.

For several years the Mediterranean countries have undertaken major reforms to make their banking system more secure by funding more non-performing loans, to develop stock exchange and to encourage investment funds.

Nevertheless, all studies underline the difficult access to bank financing of private operators and his cost, just as the obvious underdevelopment of the non- bank financing.

The asked questions in this session are the following ones:

• Is the relative safety of the financial sector confirmed everywhere?
• Isn’t there a risk that the crisis has hampered reform efforts underway in the financial sector and prohibits the necessary rebound when the real effects will manifest themselves?
• Which consequences will have on the financial system capital losses suffered by the Gulf countries?
• Is the financial system equipped to support companies threatened by the European recession?

Session 2: What will be the effects of a global recession, in particular the European, on the PM?  Through which transmission channels

The real shock linked to the crisis will pass through four main channels, exports which will suffer from the decrease in the European domestic demand and more generally of the domestic demand of the OECD countries, tourism, the transfers of incomes of the immigrant workers who directly register the rise of unemployment in Europe and the inflow of direct investments. It is clear that each Mediterranean country has specificities which make it more sensitive to such or such effect.

Nevertheless, there is no doubt that these effects which one can describe as realities will appear everywhere. The present session will call on the leaders and entrepreneurs of the South who will indicate the magnitude of these shocks and suggest measures to be taken to mitigate its effects.

This session will also present the expected effects on unemployment and the adequacy of social policies to address the likely increase in poverty.

Session 3: Which multilateral action of the UPM and by what means? Which window of political opportunity for the UPM?

Which is the method of action of the international community with respect to the Mediterranean countries concerning the crisis?  The present session will indicate where are the responsibilities and the assigned roles with the ones and with the others and will arise the question of what can bring the Barcelona process from now on prolonged, renewed and re-enlisted by the UPM.  It will also try to evaluate if it is conceivable that the UPM does not have any specific action taking into account its initial intentions. In this discussion the representatives of the South will have a central place.

Conclusion and declaration

The organizers will bring together the principal speakers to discuss with all participants a draft declaration including recommendations which will be issued to the press.

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