Fiscal Challenges in the E uro Zone

Fiscal challenges in the E uro zone have been at the center of global economic concern in the last 2 years. Despite lower debt burdens, and higher fiscal efforts taken by E uro countries, a perception of high fiscal risk remains. This paper reviews the fiscal challenges facing the E uro area countries and the measures taken at the E uro area level to manage short‐term pressures and to enhance long‐term functioning of the area, as well as the main lines of national specific reforms. The paper shows the unique characteristics of the E uro area that still raise concerns to foster stability and the challenges to address them.