The eurozone has passed a turning point and is moving from crisis management to policies focused on structural change and improving competitiveness, EU Economic and Monetary Affairs Commissioner Olli Rehn was quoted on Thursday as saying.
“The last highpoint of the crisis was in June around the time of the election in Greece. Now we have the reverse trend,” Rehn told the Financial Times Deutschland daily.
He cited austerity policies introduced by eurozone governments which had helped to reduce budget deficits within the single currency union and said over the summer governments and the European Central Bank had stabilized the situation.
The newspaper said Rehn forecast the eurozone’s overall deficit at 3.0 percent of gross domestic product (GDP) this year and 2.5 percent next year, said the newspaper.
“A lot of what we are doing now, such as the paying out of credit to Spain and Greece was already started in the summer,” he said.
Rehn signaled he might be ready to accept slightly later deficit reductions if a country’s credibility had been won back after introducing structural reforms.
Rehn praised France which has said it aims to achieve a deficit of 3.0 percent of GDP in 2013.
“The structural approach corresponds to our recommendations,” Rehn told the Financial Times Deutschland, saying that Brussels could be flexible if Paris failed to achieve the 3.0 percent goal, provided sufficient measures had been taken to reduce the structural deficit. [Reuters]