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25 September 2014

G20: Europe must boost demand


European Voice reports from G20 finance ministers calling for Europe to boost domestic demand.

The United States has warned the European Union that time is running out for the eurozone to boost economic growth.

At the G20 meeting of finance ministers from 20 of the world’s leading economies in Australia on Sunday (21 September), Jack Lew, the US treasury secretary, said: “The [eurozone] continues to encounter persistent headwinds, with unemployment still near record highs, and inflation at dangerously low levels.”

He added that there is a risk that the headwinds will get stronger. “Among the G20 members, there is an intensified call for boosting domestic demand,” he said. According to Lew, experience in the US had shown that the eurozone needed to target growth both in the short term and in the long term. “It is clear from the US experience that the combination of taking action to boost demand in the short run and make structural changes for the long run is an important combination, and it shouldn't’t become a choice between the two,” he said.


Lew said that the eurozone policy response was hampered by internal divisions between eurozone member states. His comments were echoed by Joe Oliver, Canada’s finance minister.


Article (European Voice subscription)



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