But at the end of the day, structural problems in the deficit countries were what brought about these imbalances – so that is where the adjustments must take place. We must ensure that the other countries make their economies as competitive as Germany’s, is how ECB President Mario Draghi put it. Doing the exact opposite simply wouldn’t work.
And casting a glance at the crisis countries, we can see that many of them have already implemented necessary reforms, thereby boosting their competitiveness and narrowing their current account deficits. The European Commission’s latest estimates suggest that most crisis countries will run a current account surplus this year.