Professor Ngaire Woods on latest efforts to contain Eurozone troubles
Posted: 04 Apr 2012
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Ngaire Woods discussed the decision of European finance ministers to raise the limits of the bailout funds available to troubled Eurozone economies to contain the fiscal crisis on BBC Radio 4's 'Today' programme (31 March). She also continued the discussion in 'On the Money' on BBC Radio 5 (1 April).
Diagnosing the temporary respite from the crisis while talking on the 'Today' programme, Ngaire said “Europe’s been living on pain relief for the last few months, and that pain relief has been the European Central Bank pumping a trillion euros in the banking system of the European Union states.” Now that the pressure to stop this pain relief is building, the sense of crisis is also coming back.
Ngaire noted that the long term nature of the structural reforms currently being carried out in some Eurozone countries, and the immediate demands of the markets, require some kind of stimulus for the economies to grow in order to close the gap. The focus on austerity may therefore be the wrong focus now that the pain relief is stopping.
Ngaire explained how the problems of immediate crisis management and longer term growth plans are coming back on the table.
In 'On the Money' Ngaire also discussed the vexing problem of the consumer bubble that caused the crisis and the consumer confidence necessary to overcome the crisis.
Professor Ngaire Woods is Professor of International Political Economy, Director of the Global Economic Governance Programme, University College