Adjustment of the EU’s Anti-Crisis Strategy （Jiang Shixue）

Abstract：Since the outbreak of the European debt crisis, the EU has formulated an anti-crisis strategy with an emphasis on strengthening fiscal discipline and financial retrenchment, which has in turn plunged many countries like Greece into a vicious circle. Without foreign aid it is almost impossible for them to extricate themselves from the plight, otherwise they have to cut down on their fiscal expenditure in order to get the much-needed assistance. To this end, the austerity program has not only undermined the momentum for economic recovery, lowered the living standard of the people but also aggravated the social conflicts. So the countries have but to seek outside assistance under such unfavorable conditions.

The EU has come to recognize that extremely harsh austerity program could generate serious side-effects upon the debt-crippled countries, therefore the EU, while insisting on countries like Greece controlling the fiscal expenditure and alleviating the debt burden, has turned to encourage them to develop the economy so as to create more job opportunities and reduce the social cost as a result of the fiscal retrenchment.

IES Innovation Project Briefing，No. 8, 2012.