to foster competitiveness and employment, to contribute to the sustainability of public finances and to reinforce financial stability. The pact has been reinforced by the statement made by the Heads of State or Government of the euro area on 21 July 2011 (see also Trichet, 2011). In particular, it has been reaffirmed that fiscal consolidation is a primary goal of member states.
Let me say that I do not share the sometimes negative tone of this debate, mainly for two reasons; first, I believe the theory must be applied in a dynamic framework. Indeed, applying the theory at a specific point in time, there are few currency areas that fully live up to all the criteria of “optimality”.