Nevertheless, for the region as a whole, growth in 2012 is expected to be around trend, with domestic demand likely to play a more important role in generating growth than it has for most of the past two decades. Overall, as the IMF recently noted, the global risks still look to be tilted to the downside.
When the decision was taken in the early 1990s to introduce a common currency in Europe it was clear that this joint venture could succeed if, and only if, macroeconomic policies were permanently committed to price stability and sound public finances. This is reflected in the institutional set-up of EMU with an independent central bank and the Stability and Growth Pact.