The 17-nation euro area shouldn’t be split up and may be better balanced after the debt crisis than before it, according to a study by Joh. Berenberg Gossler & Co. and the Lisbon Council, a Brussels-based research group.
The region’s weakest economies are catching up with stronger ones because of changes brought on by the crisis, according to the report released today. Estonia was the top performer in the study’s assessments of health and adjustment, and peripheral countries such as Portugal, Ireland, Greece and Spain are seeing improvements in exports and fiscal policy.
“The notion that the euro zone needs to fracture is nonsense,” said Holger Schmieding, Berenberg’s chief economist and principal author of the report. “If policy makers can get the turmoil under control and continue with the current reform efforts, the euro zone could even turn into the top performer among the major economies in the world within a few years.”
France had the weakest ranking among the six euro-area countries with top credit ratings. France should heed “alarm bells” and rein in government spending, improve education and shore up its workforce, according to the study.
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