What are the risks? RISK 1: Euro Area Crisis RISK 2: Oil Prices
BANKS vicious cycles FISCAL GROWTH What are the risks?
What needs to be done? (policies) Fiscal policies: appropriate pace of consolidation Monetary and liquidity policies – balanced Well-coordinated policy package Structural reforms to boost long-term productivity and employment Support for the unemployed (social policies) More international coordination of macro-financial policies Strengthening the global firewall Macro-prudential policies need to be strengthened
What needs to be done? (regions/countries) Building a stronger currency union Improved fiscal rules and institutions Strengthening banking systems Euro Area
What needs to be done? (countries) Fostering domestic consumption, including through more exchange rate flexibility Economies with Large External Surpluses Economies with Large External Deficits Developing a domestic policy mix to gradually rebalance toward a sustainable export-oriented growth, based on FDI and prudent macroeconomic policies