Data gaps a hurdle to tackling global crisis: ECB
The global crisis has unveiled deep data gaps that officials must close to make effective decisions, European Central Bank president Jean-Claude Trichet said here Tuesday.
"The financial crisis has revealed information gaps that we have to close while also preparing ourselves for future challenges," Trichet told delegates to an ECB conference that coincides on Wednesday with World Statistics Day.
The eurozone was shaken in 2009 when Greece revealed deep accounting flaws and years of bogus statistics that drove up the cost of borrowing for countries like Ireland, Portugal and Spain and threatened the 16-nation bloc as a whole.
"We have seen that the potential for loss of credibility affects the entire union," Trichet said.
Greek central bank governor George Provopoulos said that "information gaps have played a role in the unfolding of financial crises in the past," pointing in particular to the 1990s Latin American crisis.
Marko Kranjec, head of Slovenia's central bank, noted that a lack of reliable data was crucial to the financial unrest that erupted in 2007 with the collapse of the US market for high-risk mortgages.
"In the beginning of the crisis, regulators and supervisors lacked some pertinent and important statistical information linked to modern financial instruments, derivatives and exposures," Kranjec said.
"In such circumstances it is of paramount importance that new information is provided as quickly as possible," he added.
Trichet said more information, including detailed data on insurance companies and pension funds would be published from June 2011 onwards as part of "very tangible prgress in the area of monetary and financial statistics."
Such data "are central to the foundations of public and private sector decision-making throughout our societies, and I would say today much more than before, at least when I draw the lesson from the recent financial crisis," he concluded.
© 2010 AFP