To ensure a structural recovery, we must boost not just short-term cyclical growth, but also long-term potential growth. In determining potential growth, the role of investment is crucial. It increases at once today’s demand and tomorrow’s supply.
In the euro area, however, the recovery has thus far mainly concerned consumption and only to a lesser degree involved investment, which is still 15% lower than its pre-crisis levels. This weakness is, moreover, common to other advanced economies as well.