ABSTRACT
Perhaps a fiscal union would reduce the risk of irresponsible budgetary policy, but it won’t prevent the emergence of competitiveness problems caused by other factors. One example is Finland, which until recently was counted as one of the most solid eurozone economies, and placed at the top of rankings of Europe’s most competitive economies. In recent years, this country has been grappling with the problem of structural uncompetitiveness, and is mired in economic stagnation. In 2016, Finland’s real GDP was barely 97% of the 2007 level. If Finland weren’t in the eurozone, its currency would weaken, easing its exit from recession. Another case worth noting is that of Slovakia. This country is managing very well in the eurozone. However, the combination of high dependence on one industry (automotive) and lack of its own currency exposes Slovakia to a serious risk. Every country in the eurozone may at a certain moment lose competitiveness for reasons that could be difficult to foresee or eliminate.
