Five Years After: European Union Membership and Macro-Financial Stability in the New Member States

69 Pages Posted: 29 Mar 2009

See all articles by Martin Čihák

Martin Čihák

International Monetary Fund (IMF)

Wim Fonteyne

International Monetary Fund (IMF)

Date Written: March 2009

Abstract

The proximity of the European Union, the prospect of membership, and actual entry by the New Member States (NMS) increased economic and financial integration in the region, leading to fast economic growth based on sizeable capital inflows. EU membership helped in developing sound macroeconomic and financial stability frameworks in the NMS. However, these frameworks remain work in progress and as such could not safeguard against private sector exuberance or risky policies, especially in the face of an unprecedented global financial crisis. Hence, more prudent policies and further strengthening of policy frameworks, especially with respect to financial stability, seem warranted.

Keywords: Financial stability, European Union, Eastern Europe, Economic integration, Economic growth, Exchange rates, Price stabilization, Payments imbalances, Financial crisis, Crisis prevention, Cross country analysis

Suggested Citation

Cihak, Martin and Fonteyne, Wim, Five Years After: European Union Membership and Macro-Financial Stability in the New Member States (March 2009). IMF Working Papers, Vol. , pp. 1-67, 2009. Available at SSRN: https://ssrn.com/abstract=1369470

Martin Cihak (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street N.W.
Washington, DC 20431
United States

Wim Fonteyne

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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