Development and Finance from issue 2010/1

Gyula Nagy

Some Consequences of the Global Financial Fiasco in the European Union

- Abstract -

JEL G-01, G-21

Losing ground for quite some time, this international financial and economic crisis proved to be a major challenge both for the European Union as a whole and its Member States in the global reshuffling of power that was triggered by processes of globalisation. Enlarged from 15 to 27 members in the last two rounds, the integration organisation is already being severely tested without the global crisis thanks to its ageing society, its disappointing innovation performance, poor competition, heavy indebtedness and its clumsy decision-making procedures. EU institutions failed to give instant crisis management responses to the crisis that deepened quickly from September 2008 on, and so pushed by their own national interests, Member States started to save their banking systems, strategic sectors and jobs on their own. Later on, in an attempt to handle and weather the consequences of the crisis in the long run, the European Commission elaborated its European Economic Recovery Programme, the key elements of which cover all these sensitive areas.

Gyula Nagy, PhD student (Széchenyi István University, Doctoral School for Regional and Economic Studies)

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