The Euro Experience: A Review of the Euro Crisis, Policy Issues, Issues Going Forward and Policy Implications for Latin America

This policy brief reviews the experience of the countries under the Euro currency,
focusing on those that have been under significant pressure in recent years—
Greece, Ireland, Portugal and Spain, referred to as “emerging” economies. At
first they experienced stable growth and converged to the most advanced
countries, but subsequent adjustment has proven elusive due to macroeconomic
conditions, worsening structural deficiencies, and incomplete integration. The
conditions for the survival of the Euro zone are complex and still far from
fulfillment. While Latin America has recently experienced a similar period of
stable growth, there is no room for complacency. The main lesson from Europe’s
experience is that Latin America must take advantage of the current context of
growth, stability and optimism in order to carry out much-needed reforms that
will leave countries adequately prepared to face a downturn in the world
economy.