№227. A Renewed Political Deal for Sustainable Growth within the Eurozone and the EU
№227. A Renewed Political Deal for Sustainable Growth within the Eurozone and the EU

An open letter to the President of the European Council

Author(s): Richard E. Baldwin, Giuliano Amato, Stefano Micossi, Daniel Gros, Pier Carlo Padoan
Subject(s): Governance, Economic policy, EU-Approach / EU-Accession / EU-Development, Financial Markets, Fiscal Politics / Budgeting
Published by: CEPS Centre for European Policy Studies
Keywords: Eurozone; EU; Structural reforms for sustained growth; internal market; international policy coordination;
Summary/Abstract: Under current policies, the European Union will only be able to pull itself out of low growth and high unemployment very slowly – too slowly to exclude dangerous economic and political assaults on the Union’s continuing cohesion and viability. What is needed is a substantial increase in the EU output growth rate, which has been persistently low for too long a time. With low growth, sovereign debt sustainability in a number of member states will remain uncertain, possibly leading to renewed strains in financial markets and rising spreads that will aggravate the costs of budgetary consolidation.

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