Besides putting in place crisis management tools and financial firewalls that not only proved effective but also underlined a degree of solidarity unseen before to accompany ambitious reform programs which began – where implemented – to yield results, European leaders have adopted major decisions aimed at significantly reinforcing the architecture of EMU.
First, the fiscal framework has been strengthened since the start of the crisis to improve fiscal discipline and restore fiscal sustainability in euro area Member States. In particular, fiscal surveillance has been enlarged and fiscal governance has been enhanced by procedural steps to nearly automatic sanctions. We expect that no further holes will be punctured in this strengthened SGP. There are encouraging signs.