Sovereign debt crisis of euro zone countries

Slawomir Miklaszewicz ()
Additional contact information
Slawomir Miklaszewicz: Warsaw School of Economics

No 135/2015, Working Papers from Institute of Economic Research

Abstract: The global financial crisis has led to a significant deterioration of the fiscal position of the euro area countries. Measures taken by member states after euro zone crisis led to a considerable worsening in the budget balance and growth of the public debt. Fiscal consolidations resulted in a deepening recession and farther fall of budget revenues, causing additional need for austerity programs, which contributed and contributes to delay in the exit of these countries from the crisis. However, the action taken by the European Central Bank has become the key point for rescuing situation of the most indebted countries. Increase of the European financial system’s liquidity by the ECB, when the euro zone sovereign debt crisis transformed additionally into a liquidity crisis, resulted in a reduction in debt servicing costs and de facto saved some member states from insolvency and the whole eurozone from collapse. The aim of the publication is to examine the fiscal position of the euro area countries and fiscal policy architecture in Europe after the outbreak of the financial and economic crisis stared in 2008. The first part of the publication consists of the analyses of the budgetary situation of euro area countries and complications with the increasing costs of servicing the public debt in the European market affected by the financial liquidity crisis. In the second section the most important changes in the framework of budgetary policies coordination process in the euro zone are presented. The final section describes the role and activities of the European Central Bank in minimising the negative consequences of the debt crisis in the euro zone.

Keywords: sovereign debt crisis of the euro area; EMU monetary policy; the European Semester; Fiscal Pact; the European Stability Mechanism (search for similar items in EconPapers)
JEL-codes: F36 F43 H63 (search for similar items in EconPapers)
Date: 2015-05, Revised 2015-05
New Economics Papers: this item is included in nep-cba and nep-eec
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.badania-gospodarcze.pl/images/Working_Papers/2015_No_135.pdf First version, 2015 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pes:wpaper:2015:no135

Access Statistics for this paper

More papers in Working Papers from Institute of Economic Research Contact information at EDIRC.
Bibliographic data for series maintained by Adam P. Balcerzak ( this e-mail address is bad, please contact ).