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By the time the Greek Loan Facility was agreed, contagion – the spread of financial instability across national borders – was on everyone’s mind.
The euro’s prospects darkened in October 2009, when a newly elected Greek government led by George Papandreou announced that the country’s budget deficit was a lot higher than initially reported.
When the euro area made its historic decision to create a common firewall, it had been buffeted by two major crises, each of which had been building for years. First, Europe was sent reeling by the US subprime mortgage debacle and the shockwaves caused by the collapse of the investment bank Lehman Brothers in 2008.
Interview with Klaus Regling, ESM Managing Director
Published in Jornal de Negócios (Portugal)
Published in Jornal de Negócios (Portugal)
4 April 2019
Interviewer: Margarida Peixoto
Original language: English
Jornal de Negócios: Is the Portuguese economy going in the right direction?
In the first few years after its 1999 debut, the euro symbolised what the euro area member states had achieved together. Citizens could work, shop, and save across borders without having to convert their money into francs and marks.
It took a half century after Schuman’s generation embarked on the project of European integration for one of the most concrete achievements of all, the single currency, to become reality.