Policy Contribution Issue n˚28 | October 2017 The missing pieces of the euro architecture Grégory Claeys Executive summary This policy contribution describes the institutional flaws of the single currency Grégory Claeys (gregory. revealed by the euro crisis and the institutional reforms that were put in place during and
[email protected]) is a in the aftermath the crisis, and evaluates the remaining fragilities of the architecture of the Research Fellow at Bruegel European monetary union. In order to achieve a more resilient monetary union in Europe, we propose: 1) to A version of this paper was form a ‘financing union’ through the completion of the banking union and the promotion of prepared for the conference an ambitious capital markets union to provide private risk sharing between the countries of ‘20 years after the Asian the monetary union; and 2) to improve the defective macroeconomic policy framework to Financial Crisis: Lessons, avoid a repeat of the mistakes of recent years. Challenges, Way Forward’, Tokyo, 13-14 April 2017, The latter involves: reforming the European Stability Mechanism / Outright Monetary organised jointly by the Asian Transactions framework to clarify its functions and improve its governance system, reforming Development Bank and the the European fiscal rules to make them more effective to achieve the two desirable objectives Asian Development Bank of sustainability and stabilisation, and creating a small-scale euro-area stabilisation tool to Institute, and was published provide public risk sharing in case of significant shocks that members of the monetary union as ADBI Working Paper No. cannot deal with alone and to help manage the euro-area aggregate fiscal stance.