Giorgos Provopoulos, said
on Friday that the
economies of
central and southeastern Europe are "clear signs" of a recovery, as the financial conditions have stabilized. The global crisis has entailed large costs for the region, said Provopoulos at a Bank of Greece-University of Oxford Conference.
“There has been a sharp decline in economic activity and unemployment has risen sharply in many countries”, he said.
“Moreover, the ongoing de-leveraging process, that is the need to repair household and corporate balance sheets, tighter bank–credit standards, as well as rising long-term unemployment, could slow the pace of economic recovery in many SEE countries”, the Bank’s head added.
He estimated that foreign investment may decline compared with pre-crisis levels, leading to lower economic growth compared with the growth rates experienced in the years leading up to the crisis.
“There will be a need to formulate and implement economic policies geared toward developing alternative sources of growth”, Provopoulos said, suggesting that the traded-goods sector and exports consist one such source of growth.
The head of Bank of Greece commented on the role of European Central Bank in the crisis.
“The Governing Council of the ECB has moved quickly and forcibly to adapt the ECB’s tools of monetary policy to the challenges of the crisis, most importantly by protecting euro area banks against liquidity shortfalls”.
source: CAPITAL
