ECB’s Coeure presses eurozone governments to reform economies

NICOSIA – The eurozone risks a loss of economic momentum and a delayed recovery unless governments match the European Central Bank’s monetary stimulus with fiscal and structural policies to support growth, ECB policymaker Benoit Coeure said on Tuesday.

Coeure, a member of the ECB’s six-member Executive Board that forms the core of the policymaking Governing Council, urged governments to press ahead quickly with the reforms to shape up their economies.

“Unless an adequate mix of monetary, fiscal and structural policies is in place to create confidence and sustain private consumption and investment, we once again run the risk of a self-fulfilling loss of momentum and a delayed recovery,” he said.

“From our side, we are fully committed to play our part in this policy mix, which is to fulfill our mandate and bring inflation back towards 2 percent.”

The experience of the eurozone crisis and adjustments made in Baltic states had shown that “on the whole, front-loaded reforms yield better results than a more gradual approach,” Coeure added in a speech in Nicosia.

Turning to Cyprus, he said there was an urgent need for implementing legislation that speeds up private sector debt restructuring. [Reuters]

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