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From pain to gain on the EU frontier. CEPS Commentary, 8 August 2011

Gros, Daniel. (2011) From pain to gain on the EU frontier. CEPS Commentary, 8 August 2011. [Policy Paper]

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    Abstract

    The first act of the eurozone debt drama was about whether any European Union member country could ever become insolvent. It ended when the highest EU authority, the European Council, officially recognised in late July that Greece does need a reduction in its debt obligations. But that acknowledgement of reality does not end the drama. The second act will be about restoring growth prospects for the EU periphery, which will pose an even more difficult challenge. In order to increase their long-term potential growth, this Commentary argues that governments in the eurozone’s periphery, including Spain and Italy, now face a dilemma: they must undertake structural reforms, but at the cost of even greater short-term pain. The debt crisis will end only when they have shown that they have understood this and accepted the inevitable sacrifices.

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    Item Type: Policy Paper
    Subjects for non-EU documents: Countries > Greece
    EU policies and themes > Policies & related activities > economic and financial affairs > financial crisis 2008-on and consequences/reforms
    Subjects for EU documents: UNSPECIFIED
    EU Series and Periodicals: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Series: Series > Centre for European Policy Studies (Brussels) > CEPS Commentaries
    Depositing User: Phil Wilkin
    Official EU Document: No
    Language: English
    Date Deposited: 17 Aug 2011 14:12
    Number of Pages: 2
    Last Modified: 17 Aug 2011 14:12
    URI: http://aei.pitt.edu/id/eprint/32301

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