Austerity versus Stimulating the Growth in EU

Financial crisis led to a sovereign debt crisis due to high deficits accumulated before the crisis and also due to large bail out programs for commercial banks. Besides the reform of EU economic governance, austerity policies were imposed at national level under Troika control, especially for the most affected peripheral countries, like Greece, Ireland and Portugal. A large number of Member States (23) entered into the excessive deficit procedure established under European Semester, adopting austerity and structural economic reforms programs. Fiscal consolidation had a very negative social and economic impact, affecting the demand and economic growth. EU and national governance must be quickly improved in many aspects in order to stimulate economic growth and increase the living standard in all Member States.