Euro area exit should be the new normal - An economic area with abysmal performance
The level of unemployment in the euro area reached 16 million people in 2016 or 10.1% of the population aged between 18 and 74 years. This is equivalent to the entire population of the Netherlands or 8 times the population of Paris. It would have been unimaginable to foresee the dismal performance of the euro area in 2002. However, looking retrospectively, the combined economic performance of euro area economies during that last 14 years has been abysmal.
At its core, the euro area, with no exchange rate movements between countries and a centralized central bank (the European Central Bank), failed as an economic project.
Euro area economies combined GDP dropped 8% between 2008 and 2013 and investment rates within the private sector collapsed 16% and have yet to return to pre-crisis levels.
The euro area GDP returned its pre-crisis level only in the last quarter of 2015, nine years after the unprecedented downturn.
The euro area countries ditched the flexible exchange rate mechanism in 2001 and, with it, the possibility of bringing their economies out of stagnations or recessions
Understand the structure of the Eurozone and the reasons behind its formation
Assess the success or failure of the Eurozone project
Understand the reasons for the project's perceived failure
Analyze why the area has not seen any meaningful recovery since the financial crash of 2008