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bruegel

2008

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Bruegel’s members

State members

AustriaBelgiumCyprusCzech RepublicDenmarkFinlandFranceGermanyHungaryIrelandItalyLuxembourgNetherlandsPolandSloveniaSpainSwedenUnited Kingdom

Partner research institutions

CEPII (Paris)CER (London)CESifo (Munich)ICRIER (New Delhi)IfW (Kiel)KIEP (Seoul)Peterson Institute (Washington DC)

Corporate members

ArevaBPDeutsche BankDeutsche TelekomEDFEMIGDF SuezFortisFrance TelecomGoldman SachsIBMNokiaNovartisNYSE EuronextPfizerRenaultSamsung ElectronicUniCredit

Other member

European Investment Bank

Members as at the beginning of June 2009. For further information about Bruegel’s governance and its relationshipwith its members, see page 18.

PA GE 2 B R U E GE L’ S A N N U A L R E P O R T 2 0 0 8

BRUEGEL’S MISSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

CHAIRMAN’S MESSAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

DIRECTOR ’S INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

OPERAT IONAL REVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

EXECUTION OF THE RESEARCH PROGRAMME . . . . . . . . . . . . . . . . . . . . . . . . .7

OTHER OPERAT IONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10

TEAM DEVELOPMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

GOVERNANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

FINANCIALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

AUDITOR ’S REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22

BRUEGEL’S PEOPLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23

Contents

B R U E GE L’ S A N N U A L R E P O R T 2 0 0 8 PA GE 3

Bruegel’s missionBRUEGEL AIMS TO CONTRIBUTE TO THE QUALITY OF ECONOMIC

POLICYMAKING IN EUROPE THROUGH OPEN, FACT-BASED

AND POLICY-RELEVANT RESEARCH, ANALYSIS AND DISCUSSION.

Bruegel is defined by five key features:

Outward-oriented focus. The European Union isan open market economy and a major worldplayer. It must enrich its policy debates, whichtoo often suffer from an inward-looking bias,and develop genuine policy discussions withother international economic players. Bruegelaims to contribute to a better understanding ofthe economic challenges and responsibilitiesfacing Europe in the context of globalisation.

Evidence-based policy recommendations.Bruegel does not stand for any particularpolicy doctrine. Its research, which is conduc-ted both in-house and through partnershipswith other research organisations, draws onstate-of-the-art analysis to assess economictransformations, discuss policy options andpropose recommendations – while alwayskeeping an eye on their practical feasibility.

Demand-driven questions, independentanswers. Bruegel’s yearly ResearchProgramme is set by the Board, which repre-sents the diversity of Bruegel’s stakeholders.Decisions on new research projects followextensive discussions with Bruegel’smembers. Once a research topic is chosen,however, research and publications are fullyindependent. All publications are releasedunder the signature of their author(s), andBruegel itself abstains from taking any policypositions.

Linking government, research, business andcivil society. Bruegel provides a forum forinformed discussions between individualsfrom diverse backgrounds. It builds on thediversity of experience of its stakeholders todevelop interaction between communities.Bruegel also aims to cooperate with leadingEuropean and international research institu-tions on specific research projects.

European reach. From the outset, Bruegel hasadopted a pan-European approach. Itaddresses topics for which policy responsibi-lity rests with individual states, the EuropeanUnion, or international organisations. Itintends to develop its presence in nationaldebates across Europe, as well as Brusselsand international discussion forums.

BRUEGEL’S NAME, while referring to a ‘BrusselsEuropean and Global Economic Laboratory’,pays tribute to Pieter Bruegel (‘the Elder’),considered one of Europe’s most innovativepainters in the 16th Century. Pieter Bruegel'sson and nephew were also renowned painterswho spelled their names ‘Breughel’; Bruegelthe Elder, however, signed most of his master-pieces with ‘Bruegel’.


Chairman’s message

In June 2008, the BruegelGeneral Assembly electedfrom among its member-ship a new Bruegel Board ofeleven. I was deeplyhonoured both to beappointed Chairman to theBoard and to have been

proposed by Mario Monti, a man of highstature who was Bruegel’s founding chairman.In recognition of his commitment and achieve-ments, the Board decided to grant Mario Montithe title of Honorary President of Bruegel, andto propose him as Bruegel’s first HonoraryMember. His legacy is one of ambition, inte-grity and independence. These are valuesclose to my heart.

The economic developments since 2007 havemade economists and policy-makers questionestablished thinking. This is no time to rely onconventional wisdom, and Bruegel in the yearsto come has to contribute to creativelyaddress the new challenges policy is confron-ted with. This is what think tanks are made forand now is their moment.

Bruegel has contributed much to meeting thedemand for continued innovative research andanalysis in response to the events of 2008and beyond. These responses have drawndirectly on its core mission to contribute toimproving the quality of economic policies inEurope and I am proud that, thanks to itsachievements, Bruegel has been nominatedEuropean think tank of the year and secondbest new think tank worldwide.

Bruegel continues to grow, both as an organi-zation and in its role as the leading Europeanthink tank of choice, focused on economicissues. It is the support of all of Bruegel’sMembers, together with the relationships thatBruegel has cultivated with its Members thatgives the organization the freedom to continuecritical and relevant work delivered indepen-dently. I would like to thank, on behalf of theBoard, the Bruegel Membership for its conti-nued support.

Leszek Balcerowicz

‘BRUEGEL IN THE YEARS TO COME MUST CONTRIBUTE TO CREAT IVELY

ADDRESSING THE NEW POLICY CHALLENGES. THIS IS WHAT THINK TANKS

ARE MADE FOR AND NOW IS THEIR MOMENT. ’



Director’s introduction‘NEVER LET A SERIOUS CRIS IS TO GO TO WASTE. ’ RAHM EMANUEL’S FAMOUS

AND PROVOCAT IVE STATEMENT APPLIES TO ECONOMIC THINK TANKS AS WELL

AS GOVERNMENTS – ALBEIT FOR SOMEWHAT DIFFERENT REASONS.

For economists, crises are atime of opportunity as wellas a time to take responsi-bility. They offer opportuni-ties because many practicalmen (as Keynes calledthem), who usually havelittle appetite for research,

suddenly want to listen to economists.Extraordinary times call for extraordinary res-ponses and this is a moment when strategyand policy must draw on fresh thinking andlessons from distant experiences rather thanmere know-how. But it is also a time to takeresponsibility, because precisely at the timeeconomists are offered an unprecedentedopportunity to see their advice become reality,they realise how much they have themselvesbeen shaken by events and challenged by thefundamental questions those events raise. Sothere is room neither for diffidence nor hubris.

Bruegel has been doing its utmost not towaste the crisis since it began and particularlysince its heightened aggravation in theautumn of 2008. Bruegel scholars have contri-buted to many policy discussions in manyfields, from regulatory reform to macroecono-mic responses and from global governance toEuropean crisis management. Some Bruegelproposals have quickly moved from out-of-the-box blueprint to accepted wisdom status. Theyhave been proactively speaking to policyma-kers and practitioners, organising debates, andinforming the public about economic perspec-tives and policy choices. Of course, with thebenefits of hindsight, we would have wished tobe more perceptive. But we hope we have doneour part on the developments of the crisis andhelped to define adequate responses.

This effort has resulted in some reordering ofour research agenda. Some projects have hadto be postponed or abandoned and resourcesreallocated to more pressing concerns. Wewould, for example, have wished to carry outprojects on services and growth or the EU’sneighbourhood policy – two important issuesfor the medium term. At least, we have beenable to withstand the pressure of immediacy,to keep on publishing and to preserve impor-tant research investments that have resultedin publications in 2008 or that will bear fruitsin 2009 and beyond – such as the project onthe internationalisation of European firms.Such investments are needed: as the crisishas deepened and its developments affect thewhole range of policy domains, the demand forstrategic thinking and well thought-out recom-mendations is, if anything, increasing.

We can be certain of more surprises down theroad. At the very least, the economic debatewill develop and intensify, as governmentsstruggle with increasingly tight constraints,unemployment worsens and citizens’ resent-ment grows. In such an environment, we willhave, more than ever, to concentrate onresearch and integrity: research because thisis a time for new ideas and new solutions, andintegrity because the bolder our recommenda-tions, the greater our duty to base them onthorough reasoning and evidence.

In this venture, the confidence of our state andcorporate members is an indispensible asset.Their continuing support in times of strain is apowerful motivation for the whole team.

Jean Pisani-Ferry


Operational review

RESEARCH

The research programme for 2008 was struc-tured into five main areas:

• Growth Drivers for Europe, devoted to analy-sing the deep determinants of Europeaneconomic performance. Research hereaimed at uncovering the factors that shapegrowth five or ten years ahead.

• Europe and the Global Economy, focusingon the role of Europe as a player in a rapidlytransforming global economy, with the goalto determine where the priorities or thegovernance of the EU’s external economicrelations need rethinking.

• Companies and Competitiveness, centredon the patterns of internationalisation ofEuropean companies and how they affectcompetitiveness and performance.

• Institutions and Policies, concentrating onthe interplay between institutions andpolicies, including but not exclusively at themacroeconomic level.

• Interdependence and Regulation, coveringthe design of regulation at EU and nationallevel and its impact on stability and perfor-mance in regulated sectors.

However, developments in the global crisisduring the course of 2008 resulted in newdemands and new priorities – which ledBruegel to reallocate resources away fromsome of its planned projects. Crisis manage-ment priorities became de facto a sixth, impor-tant research area.

A. GROWTH DRIVERS FOR EUROPE

Bruegel has started acquiring a reputation forresearch into the deep determinants of growthin Europe and is emerging as an acknowledgedsource of independent (and often critical)expertise. Building on earlier work on theLisbon strategy, on innovation-based growthand on universities, a series of publicationsaddressed several dimensions of the issueand evaluated the corresponding policy levers,providing inputs into Council discussions.

Bruegel research highlighted the potential roleof finance in a growth strategy (ThomasPhilippon and Nicolas Véron). It pointed outweaknesses in allocation of EU StructuralFunds (Indhira Santos) and criticised thecurrent research and development policyapproach of spending targets (Bruno vanPottelsberghe). Building on a 2007 publica-tion, it provided more detailed analysis ofEuropean higher education and providedrecommendations for improvement (PhilippeAghion, André Sapir et al.).

A major field for research in the coming yearsis the potential role of clean technology as adriver of growth. Initial findings were presen-ted by Philippe Aghion at a workshop on thetopic organised in July 2008, which areexpected to result in publications in 2009.However research into services and growthhas had to be postponed.

As a whole, Bruegel research on growthpolicies has been widely commented on andhas triggered significant policy-oriented dis-cussions with policymakers at senior level.

2008 publications

• Financing Europe’s fast movers, PolicyBrief, Thomas Philippon and Nicolas Véron,January

• Is structural spending on solid founda-tions? Policy Brief, Indhira Santos, February

• Europe’s R&D: missing the wrong targets,Policy Brief, Bruno van Pottelsberghe,February

• Higher Aspirations: an agenda for reformingEuropean universities, Blueprint, PhilippeAghion, Mathias Dewatripont, CarolineHoxby, Andreu Mas-Colell and André Sapir,July

B. EUROPE AND THE GLOBAL ECONOMY

Interest in Europe and the Global Economy as abroad research theme has from the very startbeen a trademark of Bruegel research. In 2007the Fragmented Power book provided a syste-matic approach to the priorities and gover-nance of the EU’s external economic relations.

This research strand was pursued in 2008 withcontributions on the need for a rethink of theEU’s migration policy priorities (Jakob vonWeizsäcker), on the food prices crisis (JuanDelgado and Indhira Santos), on Europe’sresponse to the rise of sovereign wealth funds(Lars-Hendrik Röller and Nicolas Véron) and onAsia-Europe relations (Jean Pisani-Ferry). Ajoint Bruegel-Peterson Institute project on theglobal role of the euro and transatlantic compa-risons of policy responses to the crisis was alsoinitiated (Jean Pisani-Ferry and Adam Posen).

The comparison of EU and US trade agree-ments (Henrik Horn, Petros Mavroïdis andAndré Sapir) was carried out during the yearand results were published in early 2009.However, the project on Europe and its neigh-bourhood had to be postponed and the compa-rison between patterns of internationalisationin Europe and America was not completed.

Bruegel’s focus on Europe’s external economicrelations was highlighted by the organisationof two major conferences in Washington, DC in

October and in Beijing in December, with theparticipation of senior policymakers andexperts (see the events section).

2008 publications

• The end of Europe's longstanding indiffe-rence to the renminbi, Policy Contribution,Jean Pisani-Ferry, January

• Progressive governance and globalisation,Policy Contribution, Jean Pisani-Ferry, April

• Strait is the gate – Europe’s immigrationpriorities, Policy Brief, Jakob vonWeizsäcker, July

• The new food equation: Do EU policies addup? Policy Brief, Juan Delgado and IndhiraSantos, July

• Divisions of labour: rethinking Europe'smigration policy, Blueprint, Jakob vonWeizsäcker, October

• Asia-Europe: the third link, Working Paper,Jérémie Cohen-Setton and Jean Pisani-Ferry, October

• Safe and sound: An EU approach to foreigninvestment, Policy Brief, Lars-Hendrik Röllerand Nicolas Véron, November

C. COMPANIES AND COMPETITIVENESS

Bruegel has invested significantly in theanalysis of competitiveness and internationa-lisation on the basis of firm-level data. Thisapproached has been applied both to majorlisted companies and the much broader set ofmanufacturing firms of all sizes.

In 2008 research involved several projects.The project on the euro’s effect on firm cross-border activity (Gianmarco Ottaviano et al.)resulted in a publication in early 2008. That oncorporate nationality (Nicolas Véron) resultedin a working paper. And data collection wascarried out for the project on globalisation andexecutive pay.

Following the publication of The Happy Few in2007, a Bruegel-led consortium of Europeanresearch teams was in 2008 awarded a majorEuropean Commission research grant for aproject entitled European Firms in a Global


Economy (EFIGE)1. Thanks to this support theEFIGE team, co-directed by Bruegel fellowGianmarco Ottaviano, will launch the collectionof new, comparable data on the internationali-sation of firms across a number of Europeancountries. These data are expected to shednew light on the determinants of competitive-ness, trade and foreign investment. Bruegel istherefore poised to develop research that is atthe same time at the frontier of empiricalmethodologies and very policy-relevant.

2008 publications

• The demographics of global corporatechampions, Working Paper, Nicolas Véron,July

• The new corporation in Europe, Policy Brief,Dalia Marin, September

D. INSTITUTIONS AND POLICIES

After years of relative indifference, interest inmacroeconomic issues and policies has beenstrongly revived by the aggravation of thecrisis and the discussion about the appro-priate response strategies.

Bruegel’s comparative advantage in this fieldis in making the link between macroeconomicpolicy priorities and the institutional set-up ofEuropean policy-making. Governance wasindeed the focus of the Coming of age reporton the euro area published in January 2008.Further research into the lessons of the crisisfor the governance of the euro area and the EUwas initiated during the course of 2008.

Bruegel scholars (Jean Pisani-Ferry, AndréSapir and Indhira Santos) participated inseveral initiatives on the future of the EUbudget, including through the organisation ofBruegel workshops, but publication wasdelayed as the issue moved off the 2008policy agenda. Publications are scheduled for2009. Research was also initiated on institu-tions and policies in the new member states(Zsolt Darvas). As to the policy evaluation

project (Jean Pisani-Ferry, André Sapir andIndhira Santos), it was initiated but not yetcompleted.

After the Coming of age report, the visibility ofBruegel research in the macro field wasenhanced by papers published in the secondhalf of 2008 on Europe’s response to the crisis(see section F, overleaf).

2008 publications

• Coming of age: report on the euro area,Blueprint, Jean Pisani-Ferry, PhilippeAghion, Marek Belka, Jürgen von Hagen,Lars Heikensten and André Sapir, January

• Government size and output volatility:should we forsake automatic stabilisation?Working Paper, Xavier Debrun, Jean Pisani-Ferry and André Sapir, April

• Public pensions and intra-EU mobility: anunfinished agenda, Working Paper, RobertFenge and Jakob von Weizsäcker, May

• A tail of two countries, Policy Brief, AlanAhearne, Juan Delgado and Jakob vonWeizsäcker, June

E. INTERDEPENDENCE AND REGULATION

Bruegel activity in this field is developing.Research on financial regulation and supervi-sion (Nicolas Véron) has developed and isexpected to result in further publications in2009. Two workshops on climate policies(Juan Delgado) were organised in 2008,whose results will be made available in areport scheduled for summer 2009. And theproject on intellectual property (Bruno vanPottelsberghe) has been completed, resultingin a publication in June 2009. Unfortunatelyprojects on electricity and telecoms have beensignificantly delayed, in part for lack of accessto adequate data.

2008 publications

• Policymakers and the R&D-patent rela-tionship, Policy Contribution, Bruno van

1. Details can be found on www.efige.org.


Pottelsberghe, May• The London Agreement and the cost of

patenting in Europe, Working Paper, Brunovan Pottelsberghe and Malwina Mejer, May

• Empower users of financial information asthe IASC Foundation’s stakeholders, PolicyContribution, Nicolas Véron, July

F. THE CRISIS AND POLICY RESPONSES

In the course of 2008 several Bruegel scholarsparticipated actively in the discussion on thecrisis and policy responses to it, whether regu-latory or macroeconomic. As is natural in suchcircumstances, part of the crisis-relatedoutput took the form of short pieces in thepress and electronic media as well as partici-pation in numerous discussions and seminars.Bruegel, however, strove to resist the pressureof immediacy and also contributed throughmore elaborate research-based papers.

2008 publications

• Testing times for global financial gover-nance, Essay, Ignazio Angeloni, October

• Will the current crisis trigger a revival of theIMF? Policy Contribution, Jean Pisani-Ferry,October

• Fair-value accounting is the wrong scape-goat for this crisis, Policy Contribution,Nicolas Véron, May

• A European recovery programme, PolicyBrief, Jean Pisani-Ferry, André Sapir andJakob von Weizsäcker, Policy Brief,November

• Avoiding a new European divide, PolicyBrief, Zsolt Darvas and Jean Pisani-Ferry,December

• Estimating the size of the Europeanstimulus packages for 2009, PolicyContribution, David Saha and Jakob vonWeizsäcker, December2

• The international agenda: immediate priori-ties and long-term challenges, PolicyContribution, Jean Pisani-Ferry, December

EVENTS

A. CONFERENCES

Bruegel organised or co-organised three majorconferences in 2008: the first one, co-organi-sed with the World Bank and held in Brussels,addressed economic challenges in EasternEurope; the second, on the international role ofthe euro was co-organised with the PetersonInstitute for International Economics and heldin Washington, DC; the third, on the implica-tions of crisis for Asia and Europe, was organi-sed within the framework of the Asia-EuropeEconomic Forum and held in Beijing.

On 3 July Bruegel hosted ‘From Transition toConvergence: Economic challenges in EasternEurope and the Former Soviet Union’ with theWorld Bank. The conference looked at therecord of economic development and conver-gence in countries – some of which are nowmembers of the EU, and some of which are not– that initiated two decades ago their transi-tion to the market. Speakers includedTheodore Alhers (World Bank), Bozidar Djelic(Deputy Prime Minister, Serbia), Yegor Gaidar(Institute for the Economy in Transition,Moscow), Shigeo Katsu (World Bank), AliMansoor (Finance Secretary, Government ofMauritius), Katharina Mathernova (EuropeanCommission), Ivan Miklos (MP and formerDeputy Prime Minister, Slovak Republic),Pradeep Mitra (World Bank), Jean Pisani-Ferry(Bruegel), Hryhoriy Nemyria (Deputy PrimeMinister, Ukraine), André Sapir (Bruegel) andJakob von Weizsäcker (Bruegel).

On 10 October Bruegel, along with the PetersonInstitute, held a conference in Washington DC,‘The euro at 10: the next global currency?’ Theconference, that was part of a joint Bruegel-Peterson project supported by the EuropeanCommission, was held at the time of the IMF-World Bank annual meeting. Beyond the pre-sentation of research on the international roleof the euro, it provided an opportunity for dis-cussion on crisis-related policy issues.

2. This note was updated several times after its initial publication.

PA GE 1 0 B R U E GE L’ S A N N U A L R E P O R T 2 0 0 8

Speakers included Joaquín Almunia (EuropeanCommission), Leszek Balcerowicz (WarsawSchool of Economics; Chairman of Bruegel’sBoard), Fred Bergsten (Peterson Institute),Lorenzo Bini Smaghi (European Central Bank),Linda Goldberg (Federal Reserve Bank of NewYork), Jean-Claude Juncker (chairman of theEurogroup), Mohsin Khan (IMF), KristinForbes (Sloan School of Management, MIT),Erkki Liikanen (Governor, Bank of Finland),Thomas Mayer (Deutsche Bank), Jean Pisani-Ferry (Bruegel), Adam Posen (PetersonInstitute), André Sapir (Bruegel), DominiqueStrauss-Kahn (IMF) and Larry Summers(Harvard). The results of the conference dis-cussions will be presented as a book in 2009.

On 8-10 December the Asia-Europe EconomicForum created by Bruegel with partners inChina, Japan and Korea held its second confe-rence in Beijing3. The topic was ‘The GlobalFinancial Crisis: Policy Choices in Asia andEurope’. Speakers included Agnès Bénassy-Quéré (CEPII), Ignazio Angeloni (Bruegel andECB), Giancarlo Corsetti (European UniversityInstitute), Fan Gang (National EconomicResearch Institute), Miranda Goeltom (Bank ofIndonesia), Masahiro Kawai (ADBI), Ku-HyunJung (Samsung Research Institute), RachelLomax (formerly Bank of England), ErikNielsen (Goldman Sachs), Yung-Chul Park(Korea University), Jean Pisani-Ferry(Bruegel), Klaus Regling (Lee Kuan YewSchool of Public Policy), Gwang-ju Rhee (Bankof Korea), Dennis Snower (Kiel Institute),Hiroshi Watanabe (JBIC), Yi Gang (People’sBank of China), Yu Yongding (CASS), NaoyukiYoshino (Keio University) and Zhang Jianhua(People’s Bank of China).

B. WORKSHOPS

Eight workshops were organised in 2008, all atBruegel premises. These small-scale eventstypically involve 20 to 30 experts and policyma-kers for discussion on relevant policy issues.

• 14 January, ‘Reforming the EU budget: thetale of two new member states’ saw presen-tations by Mojmir Mrak (University ofLjubljana, Slovenia), Jaroslaw Pietras(Warsaw University, Poland) and AndréSapir (Bruegel).

• 10 March, ‘EU and US farm policies’ was ajoint workshop with CEPII, the GermanMarshall Fund and IFPRI. It included contri-butions from Lionel Fontagné (CEPII),Antoine Bouet (IFPRI), Loretta DormalMarino (European Commission, DG AGRI),Indhira Santos (Bruegel), Joe Guinan(German Marshall Fund), David Blandford(Pennsylvania State University) and LeeAnn Jackson (WTO).

• 13 March, ‘The Financial Crisis in Asia andEurope’ was an AEEF workshop held at theNational Bank of Belgium. Speakersincluded Agnès Bénassy-Quéré (CEPII),Pervenche Berès (European Parliament),Marco Annunziata (Unicredit), Jean-PierreLandau (Banque de France), Philip Lane(IIIS Dublin), Frank Moss (ECB), JeanPisani-Ferry (Bruegel), Peter Praet(National Bank of Belgium), Klaus Regling(European Commission), Gwang-ju Rhee(Bank of Korea), André Sapir (Bruegel),Wataru Takahashi (Bank of Japan), NicolasVéron (Bruegel), David Vines (Oxford), YiGang (People’s Bank of China) and NaoyukiYoshino (Keio University).

• 26 May, ‘The EU budget: which reforms arefeasible and how to obtain them’ was a jointworkshop with Demos Europa, the Polishthink tank. It featured presentations fromJaroslaw Pietras (University of Warsaw),Jean Pisani-Ferry (Bruegel) and AndréSapir (Bruegel; Université Libre deBruxelles).

• 24 June, ‘EU climate policies: decision timebegins’ was a workshop held within theframework of the French presidency of theEU, with the support MEEDDAT, the FrenchMinistry for Environment, Energy andSustainable Development. Speakers

3. AEEF now has seven members: The Asian Development Bank Institute (Japan); Bruegel; CEPII (France); The Insti-tute of World Economics and Politics of the Chinese Academy of Social Sciences (China); Keio University (Japan);the Kiel Institute for the World Economy (Germany) and Korea University (Korea).

B R U E GE L’ S A N N U A L R E P O R T 2 0 0 8 PA GE 1 1

included Philippe Aghion (Harvard andBruegel), Juan Delgado (Bruegel), VitorGaspar (European Commission), and RogerGuesnerie (Collège de France).

• 23 September, ‘The European patentsystem, drawbacks and challenges’ lookedat the EU’s patent system, and discussedproposals for change from Bruegel seniorfellow, Bruno Van Pottelsberghe.

• 24 September, ‘The right climate for agree-ment: designing the post-2012 world’ wasthe second workshop for the FrenchPresidency under the auspices of MEEDDAT.It heard contributions from Joseph Aldy(Harvard Project on International ClimateAgreements and Resources for the Future),Louis Bono (US Mission to the EU), KarlFalkenberg (European Commission),Jaroslaw Pietras (Council of the EuropeanUnion), Rajiv Kumar (Indian Council forResearch on International EconomicRelations), Xianli Zhu (UNEP Risoe Centreon Energy, Climate and SustainableDevelopment), Carlo Carraro (University ofVenice), Robert Stavins (Harvard Project onInternational Climate Agreements andResources for the Future) and LaurenceTubiana (Institute of SustainableDevelopment and International Relations).

• 27 October, ‘Challenges in the WorldEconomy’ was a workshop organised jointlywith the Center for Strategic andInternational Studies (Washington, DC).Billed as a ‘dialogue between the EuropeanUnion and the United States’, the workshopincluded contributions from Bruegel fellowsJean Pisani-Ferry, Nicolas Véron and AndréSapir, as well as Hugo Paemen (Hogan &Hartson), Bruce Stokes (German MarshallFund), Rolf Langhammer (Kiel Institute),Riccardo Perissich (APCO Worldwide) andLaurens Jan Brinkhorst (University ofLeiden).

C. POLICY PANELS AND SEMINARS

On 25 June, Bruegel held a Joint Policy Panelwith Notre Europe to discuss the report ‘AEuropean strategy for globalization’ by LaurentCohen-Tanugi, chair of the ‘Europe in the Global

Economy’ taskforce appointed by the Frenchgovernment. The panel consisted also ofDaniel Gros (CEPS), Gert-Jan Koopman(European Commission), Håkan Jonsson(Secretary of State for European Affairs,Sweden) and Tommaso Padoa-Schioppa(Notre Europe).

On 7 July Bruegel held a joint seminar withEURODAD, ‘IMF structural conditionality: morethan cosmetic changes?’ with Ruben Lamdany(IMF Independent Evaluation Office) and NuriaMolina (Eurodad).

On 29 October Bruegel held a joint seminarwith the Peterson Institute entitled ‘Maghrebregional and global integration: a dream to befulfilled’. It featured contributions from AndréSapir (Bruegel), Stuart Eizenstat (Covington &Burling LLP), Dean DeRosa (ADRInternational), Francis Ghilès (EuropeanInstitute of the Mediterranean), Mustafa Faïd(SPTEC Conseil), Abderrahmane Hadj Nacer(former Governor, Central Bank of Algeria) andHughes Mingarelli (Deputy Director General,DG RELEX, European Commission).

On 2 December, Bruegel, with the Banque deFrance in Paris held a presentation of the Bruegelblueprint ‘Ofmarkets, products and prices – theeffect of the Euro on European firms’. It was pre-sented by the authors Lionel Fontagné (CEPII),Thierry Mayer (CEPII, CEPR) and GianmarcoOttaviano (Bruegel, Bocconi University).

D. SEMINARS

Bruegel holds regular presentations and dis-cussions in four events series: EconomicPolicy Seminars, Finance Focus Breakfasts,the Energy and Climate Exchange and lunch-talk@bruegel, and a number of events notrelated to a particular series.

The Bruegel Economic Policy Seminar, coordi-nated by Research Fellow Indhira Santosprovides an opportunity for speakers topresent research papers with a bearing onpolicy discussion. The seminar had tensessions in 2008:


• 17 January, ‘The effect of the euro on intra-EMU trade: smaller than initially estimatedbut continuing to grow?’ with JeffreyFrankel (Harvard University) and Paul DeGrauwe (KU Leuven) as discussant.

• 19 February, ‘Understanding differences ininstitutional quality – the economic andpolitical effects of individual values’ withGuido Tabellini (Bocconi University) and Tonvan Schaik (Tilburg University) as discus-sant.

• 10 April, ‘What a different world... Costs andpolicy for a low carbon society’ with CarloCarraro (University of Venice) and JosDelbeke (European Commission, DGEnvironment) as discussant.

• 15 April, ‘Asset price bubbles and economicpolicy’ with Jaume Ventura (CREI; PompeuFabra University) and Tom Mayer (DeutscheBank) as discussant.

• 20 May, ‘Quantifying the gains of migrationand trade: the case of western and easternEurope’ with Giovanni Peri (University ofCalifornia Davis) and Jakob von Weizsäcker(Bruegel) as discussant.

• 19 June, ‘Food prices, tariffs and poverty:why isn’t the Doha round more developmentfriendly?’ with Alan Winters (University ofSussex) and Péter Balás (EuropeanCommission, DG Trade) as discussant.

• 13 October, ‘What’s up with exchange ratesanyway? Explaining the relationshipbetween exchange rates and macroecono-mic fundamentals’ with Philippe Bacchetta(University of Lausanne) and RafaelWouters (National Bank of Belgium) as dis-cussant.

• 6 November, ‘The subprime-mortgage finan-cial crisis: Lessons for a new regulatorysystem’ with Martin Hellwig (Max PlanckInstitute for Research on Collective Goods,Bonn) and Nicolas Véron (Bruegel) as dis-cussant.

• 10 November, ‘Happiness in transition: Whyare citizens in transition economies relati-vely unhappy?’ with Sergei Guriev (NewEconomic School Moscow) and István P.Székely (European Commission, DG ECFIN)as discussant.

• 18 December, ‘Conventional pseudo-wisdom: does a flexible exchange rateregime really facilitate current accountadjustment?’ With Menzie Chinn (Universityof Wisconsin) and Jean Pisani-Ferry(Bruegel) as discussant.

The Finance Focus Breakfast series, coordina-ted by Research Fellow Nicolas Véron, is speci-fically targeted at market participants,policymakers and academics interested infinancial market issues. Twelve sessions wereheld in 2008:

• 17 January, ‘Has the financial spherebecome too large?’ with Thomas Philippon(Stern School of Business) and BernardDelbecque (EFAMA) as discussant.

• 27 February, ‘New business models for aborderless financial marketplace’ with PhilBruce (NYSE Euronext), Peter Norman(Journalist and writer), Philippe Tastevin(NYSE Euronext) with Olivier Lefebvre(Euronext Brussels) as discussant.

• 19 March, ‘The ‘Padoa-Schioppa Proposal’for EU banking supervision’ with GiovanniSabatini (Ministry of Economy and Finance,Italy) and Laura Segni (Ministry ofEconomy and Finance, Italy).

• 29 April, ‘Global financial regulation: can itbite?’ with Howard Davies (London Schoolof Economics), David Green (UK FinancialReporting Council) and Freddy Van denSpiegel (Fortis) as discussant.

• 14 May, ‘The unique features of competitionin financial services’ with Stijn Claessens(International Monetary Fund) and RobertMcLeod (MLex Market Intelligence) as dis-cussant.

• 21 May, ‘How institutional investors are res-haping European companies’ with PedroMatos (Marshall School of Business, UCLA)and Xavier Dieux (Willkie, Farr & GallagherLLP) as discussant.

• 24 June, ‘Options for burden-sharing in EUbanking crisis management’ with PeterNyberg (Ministry of Finance, Finland) andDirk Schoenmaker (Ministry of Economics,the Netherlands) and Grégory Nguyen(National Bank of Belgium) as discussant.


• 15 July, ‘Is leveraged equity investmentgood, bad or ugly?’ With Norbert Reis (TheCarlyle Group), Emma Thorpe (The CarlyleGroup) and Pervenche Berès, MEP.

• 16 September, ‘The financial crisis: whatcomes next?’ with Alberto Giovannini(Unifortune Asset Management) and VitorGaspar (European Commission, BEPA) asdiscussant.

• 3 October, ‘Banking supervision: is there aSpanish model?’ with Jesús Saurina(Banco de España) and Sergio Lugaresi(UniCredit) as discussant.

• 12 November, ‘How will the Obama adminis-tration reform financial regulation?’ withJon Levy (Eurasia Group) and Ed Cody (TheWashington Post) as discussant.

• 2 December, ‘Central and Eastern Europeanfinancial systems in the crisis’ with JeanLemierre (BNP Paribas) and György Surányi(Intesa SanPaolo) as discussant.

The Energy and Climate Exchange series waslaunched in 2008 and co-ordinated by fellowJuan Delgado. It was designed as a referencediscussion forum in Brussels for professionalsin the energy and climate change fields andother interested parties from various commu-nities (academia and think tanks, policy insti-tutions, selected press, business, NGOs, civilsociety) to discuss issues related to the eco-nomics of energy and climate change policies.Six sessions were held in 2008:

• 3 June, ‘Business opportunities fromclimate change’ with Lorraine Bolsinger(Ecomagination, GE).

• 14 July, ‘Putting the renewable target inplace’ with Mario Ragwitz (Frauhofer-Institute for Systems and Innovation).

• 17 September, ‘The role of the CleanDevelopment Mechanism in a post-2012global climate agreement’ with AxelMichaelowa (Zurich University).

• 7 October, ‘Securing Europe’s energy supply’with Claude Mandil (former ExecutiveDirector of the International EnergyAgency).

• 27 November, ‘Global carbon markets’ withDenny Ellerman (Massachusetts Institute

of Technology).• 4 December, ‘A critique of EU climate change

policy’ with Dieter Helm (New College,Oxford).

The lunchtalk@bruegel series typically high-lights current topics and features a presenta-tion by a guest speaker followed by aresponse from an expert in the same field. Itwas coordinated by Research Fellow JuanDelgado in 2008. During the year Bruegel heldfour lunchtalks:

• 5 February, ‘The genesis of GATT: Lessonsfor today’s trade negotiations’ with DouglasIrwin (Dartmouth College) and PetrosMavroidis (Université de Neuchâtel;Columbia Law School) and Roderick Abbott(London School of Economics; ECIPE) asdiscussant.

• 13 February, ‘But can the EU deliver? Policyoutputs and Europe’s political landscape to2009’ with Maurice Fraser (London Schoolof Economics).

• 21 February, ‘US electricity restructuring:what have we learned?’ with Frank Wolak(Stanford University) and Yves Smeers(Université catholique de Louvain) as dis-cussant.

• 6 March, ‘Making regulation and competi-tion compatible: what is the recipe?’ withVivek Ghosal (Georgia Institute ofTechnology) and Marcel Canoy (EuropeanCommission, BEPA) as discussant.

E. ANNUAL MEETING

On 11-12 June, Bruegel held its third AnnualMeeting as a high-level event bringingtogether its Members, Board and Staff at theHilton Hotel, Brussels and the Palais d’Egmont.At the dinner on June 11th, Bruegel membersand guests heard from IBM CEO SamPalmisano.

The theme of the Annual Meeting was ‘The newworld economic landscape’ and included guestspeakers Ignazio Angeloni (SACE), JeffreyCurrie (Goldman Sachs), Caio Koch-Weser(Deutsche Bank and Bruegel Board), Almos


Kovacs (Ministry of Finance, Hungary), KevinO’Rourke (Trinity College Dublin), Adam Posen(Peterson Institute and Bruegel Board), PaulSeabright (Université de Toulouse and BruegelScientific Council) and Herman Verwilst(Fortis).

PPUUBBLLIICCAATTIIOONNSS

All Bruegel research is for publication. BruegelBlueprints are reports presenting economicanalyses leading to policy recommendations.Three Blueprints were published in 2008 (seesection on the execution of the research pro-gramme).

Policy Briefs continue to be the main vehiclefor Bruegel’s research output. In 2008 tenPolicy Briefs were published; these have alsobeen covered in the section on the executionof the research programme.

Bruegel Working Papers present work inprogress by Bruegel scholars or research asso-ciates. During 2008 Bruegel published fiveworking papers.

Policy Contributions are short texts on specificpolicy questions, including testimonies athearings, responses to consultations and pre-sentations to policy panels. During 2008Bruegel published six policy contributions:

The Essay and Lectures Series provides acompact record of the views of scholars andpractitioners as they write for, or lecture atBruegel events. In June 2008 IgnazioAngeloni, former Director for InternationalFinancial Relations at the Italian Ministry ofEconomy and Finance, joined Bruegel as avisiting scholar. As part of his work at Bruegelhe completed ‘Testing Times for GlobalFinancial Governance’.

WEBSITE

All Bruegel’s publications, event reports,opinion pieces and other output are madeavailable on www.bruegel.org. The websiteenjoyed more than 168,000 unique visitors in

2008 (a 68 percent increase on the previousyear) and more than 1.1m pages viewed (a 36percent increase on 2007).

PRESS AND MEDIA

Bruegel is prominent in the relevant nationaland international press, with 700 articlespublished during 2008 including a reference toBruegel or a quote from, or interview with, aBruegel scholar. The total included 117 opinionpieces or columns written by Bruegel researchstaff for leading European and internationalnewspapers such as Cinco Dias, Corriere dellaSera, Les Echos, Financial Times, FinancialTimes Deutschland, Gazeta Wyborcza, The IrishIndependent, The Irish Times, Handelsblatt, LeMonde, Rzespospolita, La Tribune, LaVanguardia, and The Wall Street Journal.

Bruegel scholars also regularly contribute toonline media through opinion pieces or blogssuch as Eurointelligence, FTD-Wirtschaftswunder, The Guardian BusinessBlog, Telos-eu, La Voce and Vox-eu.

Bruegel scholars also contributed to the non-print media, including interviews for ABCNational Radio (USA), Al Jazeera, Arte,Associated Press TV, Bloomberg TV, CanalArgent (Canada), CNBC Europe, Czech NationalTelevision, Deutsche Welle Radion, LCI,Bloomberg TV, Sveriges Television SVT, France3, BBC Radio 5 Live, BBC1, BBC2, BBC WorldService Radio, BBC World TV, Canal Plus, DW-Radio, Euronews, Finnish TV, France 3, France24, France Inter, France Culture, MarkizaSlovakia, ORF Austria, Radio Alger, RadioAtlantique (Morocco), Radio BFM, RadioClassique, Radio France Internationale, RadioFree Europe (Czech Republic), Radio La Voix del’Amérique (USA), Radio NetherlandsInternational, Radio Suisse Romande, RadioTSF, RTE (Ireland), SVT (Sweden), US NationalPublic Radio and others.


Team Development

The following individuals joined Bruegel during2007:

Zsolt Darvas, Research Fellowjoined Bruegel in September 2008 as a VisitingFellow and became a regular research fellow inJanuary 2009. He is also Research Fellow atthe Institute of Economics of the HungarianAcademy of Sciences and Associate Professorat the Corvinus University of Budapest.Previously he was the Research Advisor ofArgenta Financial Research Group in Budapest.Before that, he worked at the research unit ofthe Central Bank of Hungary (1994-2005)where he served as Deputy Head. His researchinterests include macroeconomics, internatio-nal economics, central banking and timeseries analysis.

Maite de Sola, Research Assistantjoined Bruegel in September 2008. She holdsan MA from the School of AdvancedInternational Studies at the Johns HopkinsUniversity. Her research interests lie inmacroeconomics and political economy.

Martin Kessler, Research Assistant joined Bruegel in September 2008. He holds aMasters in Economics from Paris School ofEconomics, on analysis and economic policy.His interests lie in innovation policy, growthand macro-economics.

Delphine Michel, Research Managerjoined Bruegel in September 2008. Previouslyshe worked as head of the European team forthe consulting department of Greater LondonEnterprise, Brussels. She has also worked atthe regional level in France, Thessaloniki andBrussels, on the management of European

funded projects and programmes.

David Saha, Research Assistantjoined Bruegel in September 2008. He holdsan MSC in economics with a specialisation inpublic economics from the London School ofEconomics. His main research interestrevolves around taxation, fiscal policy andlabour economics.

Matilda Sevon, Administrative Assistant joined Bruegel in November 2008. She holds adegree in philosophy from KU Leuven. Prior tojoining Bruegel, she worked in the customerservices department at Nespresso.

Reinhilde Veugelers, Senior Research Fellowjoined Bruegel in November 2008. She is alsoa professor at KULeuven, Belgium at theFaculty of Economics and Business, a CEPRResearch Fellow and member of CommissionerPotocnik’s Knowledge for Growth expert group.Previously she was advisor at the EuropeanCommission as part of BEPA. Her research withBruegel is concentrated in the fields of indus-trial organisation, international economics andstrategy, innovation and science.

Vanessa Witkowski, Media & CommunicationsOfficerjoined Bruegel in September 2008. After com-pleting her first degree in the United Statesshe obtained a Masters degree at the Collegeof Europe (Natolin), based in Warsaw. She hasworked for cafebabel.com and the MadariagaEuropean Foundation.

Frank A. Wolak, Non Resident Senior Fellowjoined Bruegel in April 2008. He is a Professorat Stanford University and a visiting scholar at


the University of California Energy Institute aswell as Research Associate of the NationalBureau of Economic Research (NBER). He isalso Chairman of the Market SurveillanceCommittee of the CISO for the electricitysupply industry in California. He participates inBruegel research on industrial organisationand econometric theory.

During the course of 2008 Bruegel also bene-fitted from the work of Cecilia Chavez Sanchez(Executive Assistant, Events Co-ordinator), aswell as a number of students who assisted in aproject over the summer: Raphael d’Ostuni,Arnaud De Vos, Bastein Hermans, JérémyLauer-Stumm, David Lebrun, Elena Marzal,Fernando Miguel, Francois van Bladel, JérémieWeisengrun.


GovernanceBRUEGEL’S GOVERNANCE FRAMEWORK IS DESIGNED TO ENSURE BOTH THE

INDEPENDENCE OF I TS RESEARCH AND ITS RELEVANCE TO D IVERSE

STAKEHOLDERS.

Bruegel is registered as a Belgian internationalnon-profit association (AssociationInternationale Sans But Lucratif) under thenumber 0867636096, with registered officeon Rue de la Charité 33, B-1210 Brussels. Thebasis for its governance is formed by itsstatute and bylaws, both of which can bedownloaded from Bruegel’s website.

In 2008 the association had two categories ofMembers. State Members are governments ofmember states of the European Union whichhave chosen to join Bruegel; CorporateMembers are international firms whoserequest for membership has been approved byBruegel’s Board.

In early 2008, Bruegel completed the member-ship structure implied by its statute byappointing seven Partner ResearchInstitutions.

Also in 2008 the European Investment Bankexpressed interest in becoming a memberand, following decisions by the GeneralAssembly and the Board, it became memberon 1 January 2009.

Each member appoints a Senior ContactPerson and an Alternate, which represent it inBruegel’s governance bodies. The details ofMembers’ financial contributions are given inthe ‘Financials’ section of this report.

The highest body is Bruegel’s GeneralAssembly, which brings together all members.The General Assembly is complemented by socalled ‘Groups’ which are formed, respectively,by Bruegel’s state and corporate members. TheGeneral Administration Body (organe d’admi-

nistration générale under Belgian law) is theBoard, which is entrusted with broad decision-making powers, including on senior recruit-ments and the research programme but hasno responsibility for publications and policypositions.

In 2008, the General Assembly met on 26February for the election of the Board and on11 June for its statutory annual meeting. TheGroup of States and Group of CorporateMembers met respectively on 22 January and11 June. The Group of Partner ResearchInstitutions met on 18-20 February.

The Board was renewed in 2008 at the end ofthe first Board’s three-year mandate. InJanuary, Thomas Mirow, Jaroslaw Pietras andPeter Praet were selected by the Group ofStates; Frank Dangeard, Caio Koch-Weser andJim O’Neill were selected by the Group ofCorporate Members; Adam Posen was selectedin February by the Partner ResearchInstitutions; and they jointly proposed AnnaEkström, Mario Monti and Helen Wallace asadditional Board members. The 10-strongBoard was then elected by the GeneralAssembly on 26 February, with retroactiveeffect as of 20 December 2007. At its firstmeeting on 18 March 2008 the Board reap-pointed Jean Pisani-Ferry as Director for aterm extending to 31 January 2011. Thisappointment was ratified by the Group ofStates and the Group of Corporate Members on11 June 2008.

In Spring 2008 Mario Monti, who had been re-elected as chairman of the Board, announcedhis desire to step down. On 11 June 2008, theGeneral Assembly completed the Board by


electing Lydia Aguirre and Leszek Balcerowicz,and Leszek Balcerowicz subsequently waselected by the Board as its Chairman. TheBoard also decided to grant Mario Monti thetitle of Honorary President of Bruegel, and topropose him as an Honorary Member, subjectto approval by the General Assembly.

The Board met three times in 2008, on 18March, 11 June and 24 September, with anaverage attendance rate of 73 percent. It hasestablished two Committees, the AuditCommittee chaired by Helen Wallace and theCompensation Committee chaired by LeszekBalcerowicz.

The Scientific Council is comprised of eightinternationally recognised economists,appointed by the Board for a three-yearmandate. Its role is to advise Bruegel’s Boardand Director and to assess the scientificquality of Bruegel’s output. On 24 Septemberthe Board appointed a new Scientific Councilconsisting of Peter Neary, Lucrezia Reichlin,Dani Rodrik, Paul Seabright, Jaume Venturaand Luigi Zingales, who were renewed for asecond term, and Guiseppe Bertola and SergeiGuriev, who replaced Isher Alhuwalia and NickStern. The Scientific Council met once in 2008,on 11 October, and re-elected Paul Seabrightas chairman.

Bruegel’s Research Programme is currently

Web references:

Bruegel’s statute:http://www.bruegel.org/fileadmin/Policy_Briefs/Bruegel_legal_documents/Statute.pdf

Bruegel’s bylaws:http://www.bruegel.org/fileadmin/Policy_Briefs/Bruegel_legal_documents/Bylaws.pdf

2008 research programme:http://www.bruegel.org/fileadmin/files/admin/research_programmes/annual_research_programmes/Research_Programme_2008.pdf

2009 research programme:http://www.bruegel.org/fileadmin/files/admin/research_initiatives/annual_research_programmes/2009_Research_Programme_final.pdf

Statement on research integrity:http://www.bruegel.org/fileadmin/Policy_Briefs/Bruegel_legal_documents/EN_Research_Integrity_Statement.pdf

prepared at a yearly pace. Based on extensiveconsultation with Bruegel’s members, inclu-ding at least one plenary meeting of members’ Senior Economists, a draft programme isprepared by Bruegel’s staff, sent to membersfor consultation, and proposed to the Boardtogether with the members’ feedback. TheBoard then adopts a research programme.

The research programmes since 2006 inclu-sive, can be downloaded from Bruegel’swebsite.

Bruegel research in 2008 was partiallyfinanced by two grants from the EuropeanCommission: one from DG Research’s FP7 pro-gramme for the multi-year Bruegel-led projectEuropean Firms in a Global Economy (EFIGE);and one from DG ECFIN and DG RELEX for aBruegel-Peterson Institute project on transat-lantic approaches and cooperation in macroe-conomic policy. In addition, Bruegel benefittedfrom a grant from the French presidency of theEU for the organisation of two workshops onclimate change.

Bruegel’s public Statement on ResearchIntegrity, adopted by the Board in May 2006,is also available on Bruegel’s website. TheStatement sets rules for the avoidance of poli-tical, national or commercial conflicts ofinterest which could harm the integrity ofBruegel’s research.


ASSETS

FIXED ASSETS

Furniture and office equipment

Financial fixed assetsBank guarantee

CURRENT ASSETS

Trades receivablesFinancial income to receiveOther debtorsEFIGE receivables

CASH & CASH EQUIVALENTS

DEFERRALS AND ACCRUALS

Deferred rentDeferred insuranceOther deferrals

TOTAL ASSETS

LIABILITIES

CURRENT LIABILITIES

Trade payablesVAT payablePrepaid incomeRemuneration and social security payables

NET ASSETS

NET ASSETS

ReservesSurplus of the yearAccumulated reserves from last year

TOTAL LIABILITIES AND NET ASSETS

2 0 0 7

B A L A N C E S H E E T 2 0 0 8 - 2 0 0 7

47,981.49

238,546.23685.00

82,337.03115,420.85

5242.81

126,249.97

100,000.00107,183.00

-155,228.382,833,433.71

47,981.49

436,989.11

2,521,424.89

5,242.81

3,011,638.30

333,432.97

2,678,205.33

3,01 1,638.30

Financials

84,795.08

2092.80

43,369.50799.09

14,263.10

5251.702360.51

97,293.3840,381.08

140,467.36

52,172.252,781,261.46

86,887.88

60,431.69

2,956,643.75

7612.21

3,111,575.53

278,141.82

2,833,433.71

3,111,575.53

2 0 0 8


REVENUE

Subscriptions - State MembersCategory 1 – CY, LU, SICategory 2 – IECategory 3 – AT, CZ, DK, FIN, HU (1)Category 4 – BE, NL, PLCategory 5 – DE, ES, FR, IT, UK

Subscriptions - Corporate Members Full-Year Corporate Members (2)Corporate Members joining during the year (3)

Other revenueConference-related grantsGrant revenue (4)Sales of publicationsExpenses refunded

TOTAL REVENUE

Wages and Compensation

Other operating expensesTravel costs (staff, board and scientific council)External research costsDocumentation costsOutreach-related costsOffice rents and chargesOther office costsGeneral and administrative costs

Depreciation chargesExceptional charges:Unrecoverable VATGroup insurance back-payment

Net financial incomeFinancial incomeFinancial chargesWithholding Tax

TOTAL EXPENSESFinal surplus/loss for the year2008 Surplus excluding exceptional charges

68,277.0045,516.00

256,035.00273,102.00682,760.00

1,350,000.00

45,000.0047,493.50

3,825.10

141,645.0668,523.8128,221.99

324,834.62166,513.21

88,646.03112,534.93

127,235.36-5,007.13

-18,519.39

1,325,690.00

1,350,000.00

96,318.60

2,772,008.60

-1,787,866.20

-930,919.65

-60,362.98

-44,376.36

103,708.84

-2,719,836.3552,172.25

2 0 0 8

I N C O M E S T A T E M E N T 2 0 0 8 - 2 0 0 7

78,519.0052,346.00

333,706.00314,076.00785,190.00

1,050,000.0057,500.00

64,561.79137,420.85

3,699.4013,347.74

141,398.3550,444.6432,949.26

250,631.10216,660.49

85,755.59124,687.69

98,954.47-27,643.44-14,523.84

1,553,837.00

1,107,500.00

219,029.78

2,890,366.78

-1,995,038.66

-902,527.12

-41,015.92

-12,255.63-151,545.02

56,787.19

-3,102,382.35-155,228.38

8,572.27

2 0 0 7


Notes(1) In accordance with Bruegel’s Bylaws, in 2008 the Czech Republic paid a subscription reduced by three quarters compared with other states in

category 3.(2) In 2008: Areva, BP, Deutsche Telekom, Deutsche Bank, EMI, Fortis, GDF-Suez, GE, Goldman Sachs International, Hellenic Petroleum, Iberdrola,

IBM, Nokia, Novartis, NYSE Euronext, Pfizer, Renault, Siemens, Telecom Italia, Thomson, Unicredit (€50,000 per member).(3) EDF, France Telecom, Samsung Electronics.(4) Banque de France, European Commission 7th Framework Programme

Auditor’s reportMarie-Chantal DEBROUX-LEDDETRéviseur d’entreprisesAvenue Jean-François Debecker, 114, 1200 Brussels, BelgiumTel. 00 32 2 775 88 20 • Email: [email protected]

AISBL International AssociationBRUEGEL, Rue de la charité, 33 - 1210 Brussels - Belgium

STATUTORY AUDITOR’S REPORT FOR THE YEAR ENDED DECEMBER 31, 2008to the General Assembly of the International Association to be held in June 2009

In accordance with the legal and statutory requirements, we report to you on the performance of the mandate of statutory auditor,which has been entrusted to us. This report contains our opinion on the true and fair view of the financial statements as well asthe required additional statements and information.

Unqualified audit opinion on the financial statements

We have audited the financial statements for the year ended 31 December 2008, prepared in accordance with the financial repor-ting framework applicable in Belgium, which show a balance sheet total of €3,011,638.30 and a deficit for the year of€155,228.38.

Management is responsible for the preparation and the fair presentation of these financial statements. This responsibilityincludes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financialstatements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accountingpolicies; and making accounting estimates that are reasonable in the circumstances.

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accor-dance with the legal requirements and the Auditing Standards applicable in Belgium, as issued by the Institute of RegisteredAuditors. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial state-ments are free from material misstatement, whether due to fraud or error.

In accordance with the above-mentioned auditing standards, we considered the association’s accounting system, as well as itsinternal control procedures. We have obtained from management and from the association's officials the explanations and infor-mation necessary for executing our audit procedures. We have examined, on a test basis, the evidence supporting the amountsincluded in the financial statements. We have assessed the appropriateness of accounting policies and the reasonableness of thesignificant accounting estimates made by the association as well as the overall financial statement presentation. We believe thatthese procedures provide a reasonable basis for our opinion.

In our opinion, the financial statements for the year ended December 31, 2008 give a true and fair view of the association’s assetsand liabilities, its financial position and the results of its operations in accordance with the financial reporting framework applica-ble in Belgium.

Additional statements and information

The compliance by the international association with the Law of 27 June 1921 related to non profit associations, international not-for-profit associations and foundations is the responsibility of management.

Our responsibility is to supplement our report with the following additional statements (and information), which do not modify ouraudit opinion on the financial statements:

• Without prejudice to formal aspects of minor importance, the accounting records were maintained in accordance with the legaland regulatory requirements applicable in Belgium.

• There are no transactions undertaken or decisions taken in violation of the association's statutes or the Law of 27 June 1921related to not-for-profit associations, international non profit associations and foundations that we have to report to you.

• We draw your attention on the extraordinary charges of 163 800.65 euros. These charges relate to prior years (mainly groupinsurance) and are financed by prior reserves. Before these extraordinary charges the result of the year is positive up to8572.27 euros.

Brussels, 16 May 2009

Marie-Chantal DEBROUX-LEDDETCertified Auditor


BOARD

Leszek Balcerowicz, Chairman of Bruegel,Professor of Economics, Warsaw School ofEconomicsLydia Aguirre Pereirra, Editor in Chief, ELPAíS.COMFrank Dangeard, former Chairman, ThomsonAnna Ekström, President, Swedish Confederation ofProfessional Associations (SACO)Caio Koch-Weser, Vice Chairman, Deutsche BankGroupThomas Mirow, President, European Bank forReconstruction and Development Jim O’Neill, Head of Global Economic Research,Goldman SachsJaroslaw Pietras, Director General, EuropeanCouncilAdam Posen, Deputy Director of the PetersonInstitutePeter Praet, Director, National Bank of BelgiumHelen Wallace, Centennial Professor, EuropeanInstitute at the London School of Economics

Mario Monti, Honorary President

SCIENTIFIC COUNCIL

Giuseppe Bertola, Professor of Economics,Università di TorinoPeter Neary, Professor of Economics, OxfordUniversityLucrezia Reichlin, Professor of Economics, LondonBusiness SchoolDani Rodrik, Professor of International PoliticalEconomy, John F. Kennedy School of Government atHarvard UniversityPaul Seabright, Chairman, Professor of Economicsat the Toulouse School of Economics Jaume Ventura, Senior Researcher at the Centre deRecerca en Economia Internacional (Barcelona)Luigi Zingales, Robert C. McCormack Professor ofEntrepreneurship and Finance, University ofChicago Graduate School of Business

STAFF (as at 1 June 2009)

DirectorJean Pisani-Ferry

ResearchPhilippe Aghion, Non-resident Senior Fellow Alan Ahearne, Non-resident Research FellowMarco Cornia, Research AssistantZsolt Darvas, Resident FellowJürgen von Hagen, Non-resident Senior Fellow Henrik Horn, Non-resident Senior FellowMartin Kessler, Research AssistantDalia Marin, Non-resident Senior FellowGianmarco Ottaviano, Non-resident Senior FellowLars-Hendrik Röller, Non-resident Senior FellowMartín Saldías Zambrana, Research AssistantIndhira Santos, Research FellowAndré Sapir, Senior FellowDavid Saha, Research Assistant

Bruegel’s people

Maite de Sola, Research AssistantBruno van Pottelsberghe, Senior FellowReinhilde Veugelers, Senior FellowNicolas Véron, Research FellowJakob von Weizsäcker, Research FellowFrank A. Wolak, Non-resident Senior Fellow

OperationsMatt Dann, Secretary GeneralAndrew Fielding, EditorStephen Gardner, Assistant Editor and Sub-editorDelphine Michel, Research ManagerSona Patel Amin, Administrative AssistantRenu Sabherwal, Director for Development andCommunicationMatilda Sevon, Administrative AssistantAnn Van Gyseghem, Executive AssistantVanessa Witkowski, Media Officer


Telephone +32 2 227 4210 Fax +32 2 227 4219

[email protected]

BRUEGEL 33, rue de la Charité, Box 41210 Brussels, Belgium

http://ww

w.bruegel.org

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