In the Eurozone, 2021 Portends More Stimulus -- and More Debt
MIN READDec 17, 2020 | 17:01 GMT
A statue of the euro logo is seen in front of the European Central Bank building in Frankfurt, Germany, on March 27, 2020.
(Mario Hommes/DeFodi Images via Getty Images)
The finance ministers of the eurozone have confirmed that governments in the currency area will keep their expansionary fiscal policies in place throughout 2021. In the short term, this means that governments will be free to spend and borrow without pressure from the European Union to change direction. In the long run, it means that sovereign debt levels across the eurozone will continue to grow, raising questions about their sustainability and making it hard for EU institutions to come up with comprehensive policies to boost growth. In a Dec. 16 Eurogroup meeting, the finance ministers of the 19 members of the eurozone agreed to continue introducing stimulus measures in 2021 to boost economic growth, protect jobs and cope with the COVID-19 pandemic. The ministers praised the expansive measures that were taken in 2020 and supported their continuity next year.
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