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The Eurozone has failed to deliver on the main
goals of the European Union (EU) in terms of
sustainable growth, employment, social pro-
gress, cohesion and stability.
Flaws in the initial design of the single cur-
rency have made the effects of the global eco-
nomic crisis deeper and longer, generating huge
economic costs, social suffering and political
tensions within and between Member States.
Without major reform, aiming at the comple-
tion of the Economic and Monetary Union
(EMU), neither will the crisis be properly over-
come, nor will the EU succeed its necessary
transformation into a democratic, sustainable,
cohesive and competitive growth model, with-
out which it will ultimately fail to safeguard and
reinforce its democratic and social values and
standards in an increasingly competitive and
fast-changing world. To guarantee the EMU’s
sustainability in the long run, the EMU reform
process should also involve re-launching a dy-
namic process of structural convergence
amongst its member countries and regions with-
in an inclusive and competitive Single Market.
This reform of EMU must address its inher-
ent flaws and weaknesses upfront, through
courageous and intelligent political, economic
and social change. Key proposals made by the
Group of Socialists and Democrats include:
– A major qualitative leap in democratic deci-
sion-making processes.
– Closer economic policy coordination and the
development of an EMU economic policy
based on a truly joint approach regarding
the Eurozone’s aggregate fiscal stance –in
particular, to take proper account of the im-
pact of aggregate EMU fiscal policy on the
Eurozone’s domestic demand and its finan-
cial resources– regarded as a necessary con-
dition for an improved macroeconomic poli-
cy mix, to allow for proper aggregate
demand management and clear measures to
reduce social and gender inequalities.
– Balanced monitoring of national current ac-
counts in order to address both deficits and
surpluses through country-specific recom-
mendations in a way that supports structural
convergence.
Completing and rebalancing
the economic and
monetary union
Maria João Rodrigues