Münchau, W., (2013), “Optimism about an end to the euro crisis is wrong”, The Financial Times, 27 Οκτωβρίου.
Adjustment is the key to ending the eurozone crisis. The optimists are saying that this process of regaining competitiveness is now taking place. Look at the success of the Spanish export sector or the fall in Greek wages. And, in any case, the eurozone economy is rebounding, which helps further.
This judgment is profoundly wrong. It is true that the crisis countries have brought down their current account deficits. Italy and Spain are now running surpluses. Since Germany and the Netherlands have not brought down their current account surpluses, the eurozone as a whole has moved from an almost balanced current account in 2009 to a surplus this year of 2.3 per cent of gross domestic product, according to the International Monetary Fund’s most recent estimates. The IMF puts the 2014 current account surplus at 2.5 per cent. In other words, the eurozone is adjusting at the expense of the rest of the world.
But while the eurozone is a fixed-currency regime internally, it is nothing of the sort externally. The currency does exactly what textbooks say it should: it keeps on rising, thus offsetting the improvements in the current account. Last week the euro rose to more than $1.38 against the dollar.
Σχετικές Αναρτήσεις
- Schäuble, W., (2013), “Ignore the doomsayers: Europe is being fixed”, Financial Times, 16 Σεπτεμβρίου.
- Steen, M., (2013), “Eurozone fails to cheer recovery”, The Financial Times, 10 Οκτωβρίου.
- Das, S., (2013), “The Return of Europe’s Debt Crisis”, EconoMonitor, 16 Οκτωβρίου.