BRUSSELS (Reuters) – The euro zone is out of the emergency ward, but it may face a chronic debilitating illness rather than a rapid convalescence.
The challenges confronting Europe now are to avoid complacency, rekindle economic growth while cutting debt and prevent national politics pulling the currency area apart.
Last week’s European Union summit was the first in two years that was not totally dominated by fire-fighting in the currency bloc’s sovereign debt crisis. The relief was audible.
“This was not – and that is an innovation – a meeting focused on crisis management,” European Commission President Jose Manuel Barroso said. “It was a meeting focused on growth.”
Three events have changed the mood and calmed financial markets that appeared late last year to be betting on a breakup of Europe’s 13-year-old single currency.