Unravelling the Roots of the EMU Crisis. Structural Divides, Uneven Recoveries and Possible Ways Out

摘要

The process of European integration can be described as the increasing interdependence between economies at different levels of development and with different productive capabilities.1 It evolved from a pre-eminently political project to a 'de-politicised' management based on the automatism of rules and on the assumption that market forces could promote convergence and harmonisation between and within countries. 'Early liberalisation' policies led to a 'premature deindustrialisation' - restructuring without industrialisation - which exposed the peripheral countries to stunted growth and persistent fragility with respect to external changes even before the formation of the Monetary Union. The developments within and outside the euro area - emergence of the Central European Manufacturing Core (CEMC), globalisation and exponential growth of low-cost competitors - put further pressure on the productive structure of peripheral countries. Germany's growth model, based on wage moderation and reliance on exports, proved unsustainable for the whole area. When the crisis finally exposed the mounting disequilibria, austerity was relied upon to restore convergence with severe consequences for the long-term viability of the Union.