ECB of­fi­cials press for tough re­forms in eu­ro­zone

Kathimerini English - - Business & Finance -

BER­LIN (AFP) – Se­nior Euro­pean Cen­tral Bank fig­ures yes­ter­day pressed Euro­pean politi­cians that share the euro for tough eco­nomic re­forms and warned that time was run­ning out to fix their debt prob­lems. “For a long time the sin­gle cur­rency con­cealed di­ver­si­ties in the start­ing points and in the eco­nomic poli­cies of the var­i­ous mem­bers, as well as the ab­sence of truly bind­ing com­mon rules,” Ital­ian cen­tral bank chief Mario Draghi told Ger­man busi­ness­men in Ber­lin. Im­bal­ances be­tween pow­er­houses like France and Ger­many, and vul­ner­a­ble coun­tries like Greece, Ire­land and Por­tu­gal have gen­er­ated a lack of trust in fi­nan­cial mar­kets that now ex­pect Athens to de­fault on its sov­er­eign debt. “The pri­mary re­spon­si­bil­ity for a re­sponse to a lack of con­fi­dence must be na­tional,” said Draghi, who is ex­pected to be the next ECB pres­i­dent when JeanClaude Trichet steps down in Oc­to­ber. ECB chief econ­o­mist Juer­gen Stark, who also spoke to the group of busi­ness lead­ers close to con­ser­va­tive Ger­man Chan­cel­lor An­gela Merkel, added that there was lit­tle time for the nec­es­sary po­lit­i­cal re­forms. Stark stressed that the ECB’s eas­ing of mon­e­tary pol­icy dur­ing the global fi­nan­cial and eco­nomic crises could not last for­ever, and urged gov­ern­ments to re­sist try­ing to fund growth through greater debt. “Nec­es­sary struc­tural re­forms should not be de­layed by ex­pan­sive fis­cal and mon­e­tary poli­cies,” he said.

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