Friday

29th Mar 2024

IMF: euro zone should embark on structural reforms

The International Monetary Fund (IMF) has blamed Germany, Italy and France for not adhering to the euro zone fiscal rules, because they failed to reduce their structural deficits when there was an economic boom.

The EU's Stability and Growth Pact, which underpins the euro currency, puts a deficit ceiling for countries of three percent of GDP, but it has already been breached by the EU's two largest economies - France and Germany.

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In its annual assessment of the euro zone economy, the IMF stressed that the euro zone should embark on "more sustained and vigorous structural reforms", starting with the job market and pensions, to aid economic recovery.

It also said that euro zone growth in 2003 is likely to be about 0.5 percent - less than half its forecast earlier in the year.

This confirms the European Commission's economic forecast for this year, which had to be revised in light of the economic difficulties that Member States, such as Germany, are still facing.

The IMF also said that countries should be allowed to breach the three percent limit, if they are undertaking credible long term actions to strengthen their underlying budgetary position.

IMF: eurozone economy dragging down global growth

The euro zone is set to grow five times slower than the US this year and is holding back a global recovery, according to new projections from the IMF in their latest economic report. However, all is not doom and gloom for the euro zone. 'The worst is behind us', says the IMF.

'Swiftly dial back' interest rates, ECB told

Italian central banker Piero Cipollone in his first monetary policy speech since joining the ECB's board in November, said that the bank should be ready to "swiftly dial back our restrictive monetary policy stance."

Opinion

EU Modernisation Fund: an open door for fossil gas in Romania

Among the largest sources of financing for energy transition of central and eastern European countries, the €60bn Modernisation Fund remains far from the public eye. And perhaps that's one reason it is often used for financing fossil gas projects.

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