The financial crisis of 2008 has turned into the economic crisis of 2009 and the first signs of social unrest are emerging just as the full effects of the downswing are starting to be felt in eastern Europe.
The region’s problems are deeply interwoven with those of the rest of Europe and the solution lies in a co-ordinated response on the part of both public authorities and international financial institutions. Narrow domestic approaches in individual countries would worsen the situation for all.
Most eastern European countries have seen a rapid deterioration of their real economies since last September, when credit flows dried up and their main western trading partners entered into recession. This has had a severe impact on eastern European countries’ all-important exports.
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