Conclusion

During the first years of the 2010s, the economies of the Eurozone periphery have experienced great strains. In the aftermath of the international financial crisis of 2008–2009, the interest rates on those countries’ sovereign bonds increased substantially, detaching from the rates on German bonds and from the levels that prevailed before the crisis. Ultimately, as the financing costs became unsustainable, the governments of Greece, Ireland, Portugal, Spain and Cyprus had to resort to international financial assistance, ¹ while a similar denouement was only avoided in Italy due to decisive action by the ECB. The countries under financial assistance programmes agreed to adopt harsh debt-reducing fiscal measures, which led to a historically protracted period of negative economic growth and rising unemployment, also fuelled by the synchronization of restrictive fiscal policies in the Eurozone and by the financial deleveraging of the private sector in each economy.