No firewall will be high enough to be a substitute for the required fiscal and structural adjustments in euro area member states, European Central Bank Vice-President Vitor Constancio said Wednesday.
Speaking to the European Parliament's Economic and Monetary Affairs Committee in Brussels, he said the aggregate general government deficit fell to 4.1 percent of GDP in 2011 due to both consolidation measures and some revenue developments.
He added that the ECB will play a significant role in the crisis management framework.
Earlier in the day, Bundesbank board member Andreas Dombret said there is no lasting solution to the crisis other than tackling root causes. Firewalls can help some countries to cope better with the effects of sudden shifts in investor sentiment, but, ultimately, all it can do is buy time.
by RTT Staff Writer
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