If the Pact is to work efficiently, all countries with remaining imbalances  2  BIS Review 56/2002  must commit themselves to implementing a clear consolidation strategy. Such a strategy should specify a credible adjustment path with significant improvements in the cyclically-adjusted budget balance every year. This path should be followed strictly and completed within the shortest possible time frame.
It must be based on realistic assumptions for the economic environment and include clearly specified measures. Furthermore, accounting rules must be rigorously applied and strict procedures established to monitor the implementation of the consolidation strategies. In the end, the full adherence of all governments to the Stability and Growth Pact can only be beneficial for the euro area.