ETUC calls for an expanded recovery programme, backed up by the European Central Bank
In the run up to the London G20 summit, the Organisation for Economic Co-operation and Development (OECD) released alarming figures today: the euro area economy is expected to shrink by 4% in 2009. Economic activity will not recover but stagnate in 2010 and, worst of all, unemployment will rise to a high of 12% next year.
These figures show that fiscal and monetary policy in Europe is not doing enough to support the economy.
The European Trade Union Confederation (ETUC) demands European heads of governments to decide on an expanded recovery programme: 1% of gross domestic product (GDP) needs to be invested in European investment projects in the areas of renewable energies, clean technologies and smart transportation systems. To provide stable and low cost finance, the European Central Bank (ECB) needs to buy the public debt bonds backing these public investment programmes. In addition, the ECB’s governing council meeting next Thursday should finally cut policy interest rates to close to zero.
Says ETUC General Secretary John Monks: ‘The complacency of European finance ministers and European central bankers is unacceptable. I call on the European leaders of governments in the upcoming G20 London summit to stop this policy of ‘laissez faire, laissez passer’ and to take expansionary action to prevent a return to mass unemployment’.
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