After all, delays only require an even larger adjustment further down the road. Moreover, there is increasing evidence that high public debt levels reduce growth themselves. High debt may for instance crowd out domestic private investment or deter foreign direct investment. A second priority is therefore to increase the growth potential in advanced economies via reforms.
Although we judge the overall fiscal policy stance as being broadly satisfactory in most accession countries, budgetary consolidation efforts in some countries appear to have experienced a recent setback. In these few cases, a strengthening of efforts to return to the path of sound fiscal policies is crucial.