It should be recalled that the growth and employment creation model of the past years is not sustainable: it relied on the expansion of public demand, reflected on the imbalance of public finances and on the expansion of private demand. In turn, the latter was fuelled by the favourable financing conditions enjoyed by households, mirrored in rising indebtedness and lower savings.
The growth and employment creation model of the past years triggered an increasing indebtedness ratio, which would become unsustainable if it were not corrected.