Progress towards balanced growth in eurozone

Prof. Dr. Michael Heise, chief economist of Allianz SE, on the results of this year’s report: "2011 was evidently critical for the eurozone. The confidence of financial markets in the sustainability of sovereign debt is not yet restored. However, although overshadowed by the frantic discussions on financial markets about apocalyptic outcomes and a possible blow-up of the eurozone, there actually have been some encouraging developments, as the report shows."

Ahead of this week’s pivotal EU summit, Heise sees Europe at a crossroads: "EU leaders must map out a credible path to a workable fiscal union that banishes the dangers of fiscal profligacy for the future. This will require the pooling of fiscal sovereignty and a tight governance regime, including a Finance Commissioner with intervention rights, to ensure that public finances can no longer veer out of control. Leaders must demonstrate that Europe and the eurozone have not lost their direction. Half-baked or half-hearted measures will not suffice."

The Allianz Euro Monitor 2011, the second edition of the successor to our long-running European Growth and Jobs Monitor, captures the picture in late 2011 as the eurozone endeavours to get to grips with the sovereign debt crisis. Both the Growth and Jobs Monitor and the Euro Monitor have long been flagging the need for fundamental reform in the eurozone and highlighting the risks emanating from unbalanced growth. The Euro Monitor evaluates and ranks the 17 eurozone countries based on their contribution to balanced growth.

Michael Heise, Allianz chief economist

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