The European economy is now on a quite robust growth path, with unemployment decreasing. With the improvement of the economic scenario, the policy-mix will need to be normalized. But, this normalization must be gradual and iAGS recommends the pursuit of ECB's unconventional monetary policies. The euro area has moved into a large trade surplus, which may not be sustainable. The imbalance is clearly concentrated in surplus countries. Nominal convergence remains an important issue that should be addressed by appropriate policies, beginning with surplus countries. The improvement of the overall employment numbers has not been extended to all countries and all social groups and are not followed by improvements in terms of income equality and poverty reduction. The decline in unemployment has not yet translated into a parallel decline in the indicators of income inequality. If economic growth and job creation will not spontaneously reduce inequalities and poverty, a comprehensive strategy, including reforms in labour markets, taxation and social insurance is needed to improve social well-being. Gender equality objective requires to integrate different dimensions of European policies and focus on all the dimensions of employment: female employment rate, working time and hourly wage. The governance of economic policies in the euro area is certainly far from optimal. Serious structural problems remain, only partly concealed by the cyclical recovery. The iAGS recommends the adoption of a Eurozone budget under the responsibility of a Minister of Finance for the Eurozone. The primary objective of the budget would be to fund European public goods. and modifications in their implementation. Achieving policy coordination and upward convergence is desirable but not an easy task. If agreement cannot be reached on ambitious risk sharing mechanisms, an intensification of softer forms of coordination may be the only way forward. the report >>

With the financial support from :

the S&D Group of the European Parliament within the context of their Progressive Economy Initiative, is gratefully acknowledged