Don’t repeat mistakes of the past-EU Commissioner

WASHINGTON, April 24 (BestGrowthStock) – Advanced economies must
make good on pledges to tighten regulation and curtail
government debt or the fragile recovery could unravel, a top
European official said on Saturday.

“There is a real risk that we repeat the mistakes of the
past, especially if the recovery takes hold and good intentions
are forgotten,” European Union Economic and Monetary Affairs
Commissioner Olli Rehn said in a statement to the International
Monetary Fund’s steering committee.

Rehn said sovereign debt problems posed a short-term risk
to the world economy, while the lack of balance between
countries running huge surpluses and those with deep deficits
represented a medium-term trouble spot.

In Europe, he said there was reason to be “moderately
optimistic” about the near-term outlook, with strong readings
on trade and industrial production suggesting economic growth
continued in the recently ended first quarter.

He cautioned, however, that domestic demand could contract
again this year as high unemployment weighs on consumer
spending.

“Looking ahead beyond the near-term, the robustness of the
economic recovery in the EU is yet to be tested,” Rehn said,
adding that concerns about public debt sustainability in some
countries could have a “stronger adverse impact on economic
growth than currently assumed.”

Rehn said on Friday that a rescue package for debt-stricken
Greece should be ready by early May. Greece’s debt troubles
have served as a reminder that much of the rich world is
carrying unsustainable debt burdens.

The EU’s spring economic forecast will be released on May
5. He said so far, the outlook seemed broadly in line with an
interim forecast given in February.

“However, uncertainty remains rife and the recovery is
likely to be largely reliant on global growth in the near term
and held back by weak private demand further out,” he said.
(Reporting by Emily Kaiser; Editing by Padraic Cassidy)

Don’t repeat mistakes of the past-EU Commissioner