'Growth will remain weak "»
LE FIGARO. – The euro zone recorded a growth of 4% per annum in the second quarter. This leads he will represent a substantially more optimistic about Europe?
Olivier Blanchard. – One swallow does not a summer make. The simultaneous publication of figures for poor United States (1.6% in the second quarter) and that higher numbers than expected in Europe, especially Germany, have had a big influence on public opinion. But the trends are largely the same. After catching up driven by fiscal stimulus and the restocking of companies, are now the consumption and investment must make the request. And they face numerous obstacles, particularly the weak financial system.Growth will probably remain low, both the U.S. and Europe.
Stronger growth could she encourage Germany to be less rigorous in its public finances?
No, instead, it would probably take advantage of its expansion to consolidate its public accounts quickly, which is also good economic policy response. Although the Germans are the champions of fiscal restraint, consolidation actually provided remains relatively low at this time.We've calculated that the effort envisaged for 2011 is 0.5% of GDP – what we call in technical terms "change of primary balance adjusted for the cycle – while the same figure is 1% for USA.
What countries in the eurozone growth prospects have substantially different poses there not a problem?
Today, we can define three categories of countries in the euro area. Those who are competitive and are driven by external demand, with Germany being a prime example. Those, however, have difficulty in exporting: the case of Greece, Portugal and Spain must restore their competitiveness. And countries like France which lie between the two, with a trade roughly in balance.An exchange rate and monetary policy imply that these differences do not disappear the day the next day
The crisis of sovereign debt in Europe last spring she is behind us and its consequences are they limited to the actual savings?
I would not say that because countries like Greece and Portugal are facing painful adjustment process. The crisis has led to a general tightening of fiscal policies. For now, the measures taken by European authorities, with assistance from the IMF, have calmed the markets. But troubled countries must both balance their budgets, and responding to problems of competitiveness, which will take years.
The schedule chosen by Europe to reduce the deficit to below 3% of GDP in 2013 is not it too tight?
The essential thing is not so much the year or a specific figure.We need every government has a plan for consolidation in the medium term is consistent and credible, it can take steps to convince markets. Regardless of whether in 2013 or 2014, must present the prospect of stabilizing the debt. Once the markets are reassured medium term, countries have a certain degree of freedom in the short term. Until these medium-term strategies have not been implemented, it will tend to buttress on deadlines, this is not the best approach in my opinion.
Emerging countries can they sustain such rapid growth that their current savings if the G7 would stagnate sustainable?
No short term. If the U.S. economy slows, it will have a mechanical effect on Asia, not huge, but significant nonetheless.But yes the medium term, there may be a decoupling between emerging economies and rich countries. Asian economies and Latin America have the capacity and willingness to increase domestic demand, thereby offsetting a decline in external demand if it were to happen. China is reorienting its growth in this direction.
The rebound laborious United States and Europe or Japan is not it disappointing?
As I have said earlier, this hard bounce is not a surprise. The IMF said last year and a half that the recovery would be slow.Historical experience shows that it is usually the case when a recession was caused by a financial crisis because it takes so much time to repair the damage suffered by consumers and the financial system.
The response of the G20 was best?
He played a key role in coordinating responses to fiscal policy, monetary and financial. This coordination is important. If finance ministers are fully aware of the situation in their country, they, by necessity, a more approximate what is happening elsewhere. The meetings of the G20 meet the needs of coordination become essential because of globalization.The message of the Mutual Assessment Process "G20 Toronto is very clear: strong global growth requires both fiscal consolidation in advanced countries and a reorientation of growth towards domestic demand in emerging countries. And the two are closely linked. If the U.S. example can not increase their exports, they may have a very low growth, which in turn will make it very difficult fiscal consolidation.
The G20 should he not put on the table the question of exchange rates and the undervaluation of certain currencies?
When we speak of "reorientation towards domestic demand, for example in China, it passes through a myriad of measures, one of them, but only one of them is the appreciation of the yuan . This major structural change will happen eventually. Moreover, it has already begun.It would be cons-productive to simply focus on just the exchange rate, it is only one piece of the puzzle.