The forthcoming IMF book Jobs and Growth: Supporting the European Recovery has been presented at the Bank of Italy.
The presentation focused on four selected chapters to address some of the key questions facing policymakers seeking to promote jobs and growth, including:
What are the main elements of a strategy for growth in the current environment?
How do we protect growth from the impact of deleveraging?
What are the lessons from past labor market reforms, and how harmful is duality?
What are possible growth strategies for small open economies?
Presenters:
Helge Berger/Advisor, IMF European Department
Jesmin Rahman/Senior Economist, IMF European Department
Martin Schindler/Senior Economist, IMF European Department
Antonio Spilimbergo/Advisor, IMF European Department
Summary:
There are encouraging signs that the worst of the crisis may finally be over, but the European recovery is still fragile and unemployment remains at punishingly high levels in many countries.
The presentation -- featuring selected chapters from the forthcoming IMF book Jobs and Growth: Supporting the European Recovery -- will identify key measures to boosting growth and employment over the medium term and propose a roadmap for policymakers on how to tackle these challenges.
Supportive demand policies can help protect the ongoing recovery, but completing the euro area's institutional infrastructure will be even more crucial in reducing some of the uncertainty holding back investors. But just as crucial are measures to address the damage to private sector balance sheets, which poses a particular threat to growth and employment in the medium term.
Ultimately, high levels of public debt will have to be reduced as well, but -- where possible -- this should be done gradually and in a way that minimizes the negative short-term impact on growth.
Looking further ahead, the benefits from removing structural obstacles in product and labor markets will be substantial, not least because reforms like these make it easier for countries to find new sources of growth by tapping into increasingly important cross-border supply chains.
None of this is going to be easy, but now is the time for governments to take the steps to ensure that more Europeans can get back to work again.
