By: EW News Desk Team
The European Union should not be blamed for the tough austerity policies adopted by its member nations, said European Commission President Jose Manuel Barroso on Thursday, describing the links between the EU and fiscal consolidation as a "myth", while expressing sympathy for those who may have suffered under slower economic growth.
"I know many parts of our societies attribute the current difficulties to European Union level and this is not fair because it was not the European Union that created the problem?I want to make this clear because there is a myth that it is the European Union that imposes difficult policies. It's not true," Barroso told reporters, as quoted by The Telegraph - speaking during a ceremony in Dublin to mark the beginning of Ireland's tenure as president of the European Council.
"The cause of the difficulties some countries are facing is excessive public debt created by national governments and irresponsible financial behaviour, that also accumulated excessive private debt including financial bubbles that happened under the responsibility of national supervisors."
"This is why now countries have to make painful adjustments. Britain is having a very tough budget and Britain is not a member of the euro," Barroso noted.
Citing his own past experience as a former Portuguese prime minister, Barroso said that though he understood the social devastation caused by fiscal consolidation, he still firmly believed that temporary austerity would be critical for Europe in the long run.
"I just came from Portugal where I saw how difficult, how painful these kind of reforms [are]. Yes, I feel a lot of sympathy . . . but it is my duty at the same time to say to our public that the alternatives will be much more costly."
"The European Union is a victim of the crisis, not the cause of the crisis. We are not the problem. We are part of the solution," Barroso claimed, according to the Irish Times.
This week, Barosso was also in Lisbon where he expressed confidence that the euro's survival was no longer in doubt.
"I think we can say that the existential threat against the euro has essentially been overcome?.In 2013 the question won't be if the euro will, or will not implode."
Analysts however urged caution over the euro's fate, particularly with the German elections yet to be decided.
"2013 will be a tougher year than 2012 for Germany and by extension, the euro area as a whole," said Neil Mellor, a currency expert at Bank of New York Mellon, to The Telegraph.
"The short and the medium term challenges are still great. The promise of ECB action has not lessened the need for austerity and structural reform, nor improved the lot of the increasing number of unemployed," added HSBC in its 2013 review.
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