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Rehn says 'serious concern for Italy, Spain' a year ago

Commissioner sees situation different now, but challenges remain

29 January, 11:28
Rehn says 'serious concern for Italy, Spain' a year ago (ANSA) - Brussels, January 29 - Olli Rehn, the European economic and monetary affairs commissioner, said Tuesday that "there was serious concern about Italy and Spain" a year ago and "deep uncertainty" about Greece, but the situation is now under control.

The commissioner stressed, however, that while the predictions of the end of the eurozone were wrong and progress has been made, "there are still challenges".

He added that the priorities for national governments must be to "maintain the pace of economic reform" and "continue with fiscal consolidation".

These are the policies that outgoing Italian Premier Mario Monti's emergency government adopted after taking power in November 2011.

This approach boosted investor confidence in Italy and helped ease the crisis, but Monti's austerity measures also deepened the recession Italy went into in the second half of 2011.

Rehn added that EU countries needed to implement "balanced, ambitious reforms" of labour markets that "remove obstacles to employment" and make it easier for people to find permanent, full-time jobs.

This, along with moves to revive Europe's manufacturing and services sectors, should be among governments' priorities for 2013, said Rehn, who added that "this year will be an essential test for the credibility of the EU and the eurozone". The commissioner said 2.5 million manufacturing jobs were lost in 2010 and 2011 in France, Germany, Italy and Spain.