Exiting the crisis in the right direction: A sustainable and shared prosperity plan for Europe
Exiting the crisis in the right direction: A sustainable and shared prosperity plan for Europe / Thomas Spencer, Lucas Chancel, Emmanuel Guérin. IDDRI, 2012, 32 p. (Idées pour le débat / Working Papers N°09/2012)
Points clés (source et copyright © IDDRI) :
Origins of the current crises
Europe is in the midst of a series of interlinked crises. These have their roots in the build up of structural divergences and macroeconomic imbalances between in particular Eurozone states. Important steps have been taken to strengthen economic and fiscal governance, in order to put the European economy on a more sustainable basis in the longer term. However, short-term economic stimulus is needed; otherwise the burden of austerity and structural adjustment will not be socially sustainable. At the same time, reforms need to consider long-term challenges, in particular resource pressures and climate change.
Bridging short -and long- term challenges
The shift towards a green economy can bridge these two timeframes. Long-term challenges are already emerging. Resource prices have reached record levels, unseen since 1900. Price correlations between and within resource groups are stronger than ever, and create systemic risks for the global economy. The dramatic pre-crisis rise in commodity prices, particularly oil, played a role in fuelling and triggering the crises. Resource and environmental constraints are thus already a challenge and an opportunity.
Green investments towards resilience and prosperity
The shift to a green economy is vital to guarantee long-term resilience and resource security in Europe. It will reduce Member States’ vulnerability to future oil prices, alleviating the oil price drag on the EU economy by 0.7% of GDP by 2020 already. By 2030, investments in resource efficiency can save the EU 3% of its GDP per annum. In the short-term, measures such as environmental fiscal reform and green investments can create investment in jobs and growth, particularly in troubled Peripheral countries. European coordination on these measures is vital.