O’Neil , J. and Terzi, A., (2013), “Addressing competitiveness or financial fragmentation? – a false dilemma”, Bruegel, 22 Νοεμβρίου.
In explaining competitiveness developments in the EU, use is being made of the World Economic Forum Global Competitiveness Indicator. However, in its aggregated form, this index risks conveying deceptive policy recommendations. The sharp fall in competitiveness observed in programme countries throughout the crisis is to be attributed largely to financial stress and the economic downturn, more than faltering structural reforms. A well-designed banking union has thus the potential to significantly contribute to a restoration of competitiveness in Europe.
During the past year, thanks to the European Central Bank (ECB)’s OMT announcement, we have assisted to an abatement of tension in sovereign financial markets. However, this development has not been associated with a return to growth. As explained by Mario Draghi during the ECB’s press conference on November 7, the recovery remains weak and uneven. To explain this phenomenon, a narrative is taking hold in Berlin, Frankfurt, and (in some cases) Brussels whereby crisis-ridden economies are dragging their feet and thus “governments must decisively strengthen efforts to implement the needed structural reforms […] with a view to further improve competitiveness”.
To illustrate this point, heavy reliance is being made within EU policy circles on the World Economic Forum(WEF)’s Indicator of Global Competitiveness (GCI). As revealed by Der Spiegel, at an early October preparatory meeting for the October 25 European Council, “a representative of the European Central Bank presented a series of charts (of the sort of the one below, Ed.) showing a significant decline in competitiveness […] over the last seven years”.
Για όλο το άρθρο, πατήστε εδώ.
Σχετικές αναρτήσεις
- Wood, R., (2013), “Europe: The Failure of Internal Devaluation”, EconoMonitor, 13 Νοεμβρίου.
- Janssen, R., (2013), “Structural Reforms – Be Careful What You Wish For!”, Social Europe Journal, 20Νοεμβρίου.
- Anderson, D., Hunt, B. and Snudden, S., (2013), “Fiscal Consolidation in the Euro Area: How Much Can Structural Reforms Ease the Pain?”, International Monetary Fund, Working Paper No.13/211, Οκτώβριος.