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Janis A. Emmanouilidis: Where do we stand and what to expect? – an analysis of the “state of the crisis”

Despite the latest ‘Cyprus saga’, there has been no fundamental change concerning the euro crisis: the ECB’s decisiveness, the substantially reduced risk of a euro exit, and cautious attempts towards addressing the incomplete EMU construction has substantially reduced the danger of a systemic meltdown. However, the epicentre of the crisis has shifted to other equally worrying dimensions: the social and political. Policy-makers at EU and national level will have to overcome the prevailing ‘lets-wait-and-see’ mode and intensify their efforts to cushion the negative effects resulting from a years-long recession and unbearable high levels of unemployment. Contrary to last September, there will be no actor equivalent to the ECB able to act swiftly and decisively enough to avert a potential deterioration of the crisis in case things should politically get out of control in one or the other Member State or even between EU countries.

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