The economic crisis triggered by the COVID-19 pandemic once again raises doubts about the eurozone's ability to deal with joint economic problems given its dissimilar dynamics and asymmetries. This chapter contributes to a paradigm shift in the governance of the euro area towards a more comprehensive and integrated approach. Two dimensions of this paradigm are considered. First, the need for a change in the economic policy concerning the recovery, from a supply-push to a demand-pull orientation, supported on a fiscal and monetary policy mix, integrated within a comprehensive macroeconomic approach. Second, we examine the need for a shift in external relations towards a more global integration-oriented policy, with the euro area positioning itself as an alternative to the current polarization between the United States and China. Our conclusions point to: (i) giving priority to growth and employment; (ii) promoting long-term economic sustainability based on integrated macroeconomic policies, the reduction of income concentration, and the reconstitution of strong middle classes; (iii) reorientating international relations into a perspective of cooperation; (iv) reinforcing regulation and global governance; and (v) eliminating exceptional situations and ways to evade economic controls.
CITATION STYLE
Mendonça, A., & Vale, S. (2021). Europe at the crossroads of the COVID-19 crisis: Integrated macroeconomic policy solutions for an asymmetric area. In New Challenges for the Eurozone Governance: Joint Solutions for Common Threats? (pp. 45–67). Springer International Publishing. https://doi.org/10.1007/978-3-030-62372-2_3
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