Analysis and Publications

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The European Union (EU) is facing numerous crises, including massive migration flows, the UK’s vote to leave the EU (Brexit), and rising support for anti-EU and populist parties. In “The EU’s Capital Markets Union—Unlocking Investment Through Gradual Integration,” author Zdenek Kudrna, a post-doctoral researcher at the University of Salzburg, argues that these crises all share one characteristic: They would be easier to resolve if EU economies grew faster.

To reinvigorate economic growth across Europe, the President of the European Commission, Jean-Claude Juncker, launched the “Juncker Plan” in November 2014. Kudrna introduces the Capital Markets Union (CMU) as the core regulatory initiative of this plan. 

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Europe suffers from two major handicaps: poor economic growth and high unemployment. In Europe Needs To Trim Its Excessive Fiscal Burden, Anders Åslund argues that Europe needs more structural reforms to solve these problems. Åslund addresses some fundamental questions on excessive fiscal burden: Why have public expenditures become higher in the EU than in other countries at a similar level of economic development? How have varying levels of public expenditures impacted economic growth? What level of public expenditures is desirable and how can the desired level be achieved? 

The United Kingdom’s vote to leave the European Union will have a negative impact on the European economy because it creates uncertainty and decreases business confidence for the foreseeable future, according to the International Monetary Fund’s recently updated World Economic Outlook. Beyond uncertainty, experts contend that the outcome of the June 23 vote on a so-called Brexit highlights structural issues within the Eurozone that have prevented significant growth following the 2008 financial crisis.

“There’s no doubt about the fact that this is a negative shock to growth,” Paul Sheard, executive vice president and chief economist at S&P Global, said of the British referendum. “In many ways, it’s worse for the Eurozone than it is for the United Kingdom,” he added.
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With the impending Brexit referendum on June 23, economists must anticipate the ramifications of the United Kingdom (UK) leaving the European Union (EU). This is the first time the voluntary integration of the EU has been threatened, and creates a distressing existential question: is EU membership valuable enough?

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After more than three years of negotiations to forge a Transatlantic Trade and Investment Partnership (TTIP), many elements of the agreement are still far from settled. However, it is possible to reach agreement in 2016. The negotiators are determined, and there is mounting awareness that an agreement that underscores the importance of the transatlantic economic relationship and strengthens the strategic relationship between the European Union (EU) and the United States is needed.


Atlantic Council’s Andrea Montanino warns against reading too much into leaked negotiation papers

Greenpeace’s decision to leak 248 classified documents related to the Transatlantic Trade and Investment Partnership (TTIP) negotiations only creates more confusion rather than contributing to an understanding of the complex process, according to the Atlantic Council’s Andrea Montanino.

By leaking the documents, Greenpeace intended to show that EU standards on environmental and public health will be lowered as part of compromises made during TTIP negotiations. Montanino, who is Director of the Atlantic Council’s Global Business and Economics program, cautioned against reading too much into the leaked documents noting that in such negotiations there are “tons of documents and proposals which are not part of the conclusion.”
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The United States and the European Union (EU) share the largest trade and investment relationship in the world, with more than $5.5 trillion in commerce every year and up to fifteen million jobs generated on both sides of the Atlantic. Currently under negotiations, the Transatlantic Trade and Investment Partnership (TTIP) will bolster this key partnership, increasing efficiency, spurring job creation, and generating opportunities for innovation and small and medium enterprises. At a time of slow recovery from the 2009 recession, a comprehensive agreement that protects high quality standards can send a powerful signal to the rest of the world, highlighting the United States’ and Europe’s dynamism.


The European Commission’s economic policy priorities have remained unchanged since last year’s World Bank and International Monetary Fund Spring Meetings; Europe’s political and societal context in which these policies must be implemented, however, has changed fundamentally, according to a European Commission official.

The 2016 World Bank and IMF Spring Meetings that bring together financial leaders from across the globe are taking place this week in Washington.

“So, I come here with largely the same message as my speech last year…Our main economic policy priorities remain unchanged, so what we need to concentrate is on implementation…Geopolitical fragility threatens to overshadow everything else. We need a strong economy and sense of unity to cope with all these challenges,” Valdis Dombrovskis, Vice President for Euro and Social Dialogue of the European Commission, said at the Atlantic Council on April 15. The event was hosted by the Council’s Global Business and Economics Program.
Finance Ministers and central bankers will gather in Washington from April 15-17 for the spring meetings of the Bretton Woods Institutions: the International Monetary Fund and the World Bank. It will be an important opportunity to check in on the global economy. Here are five key topics to pay attention to during the meetings.

As migrants head to Europe, International Monetary Fund study places emphasis on integration

Contrary to the rhetoric from some politicians, there is very little evidence that migrants take jobs away from host populations, and in Europe, where some countries have low to negative population growth, migration should be seen as a boon, according to an International Monetary Fund study.

“There is very little evidence that migrants or refugees steal labor from natives,” said Antonio Spilimbergo, the head of the IMF’s mission to Turkey. One explanation for this is that migrants have skills that are “complimentary” to those of the native population, “so they don’t compete for the same job, but help enhance economic activity,” he said.

In fact, Spilimbergo said, migrants transform a country’s “product mix.” For example, the presence of migrants created the ideal conditions for the textile industry in Southern California and the high-tech industry in Israel to develop and flourish, he said.

“The bottom line is that there is no strong evidence of competition,” Spilimbergo added.