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ECB highlights post-crisis wealth gap

Wednesday, October 21, 2015 - 01:42

An ECB report into the winners and losers of the financial crisis shows a personal wealth gap emerging between different euro zone states of tens of thousands of euros - with the Irish losing more than anyone else. Ciara Lee reports.

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It shook markets around the world but it wasn't just investors that lost out during the euro zone debt crisis. The ECB has charted the wealth of single currency countries post-crash. Ireland faired the worst. On average, each person lost more than 18,000 euros between 2009 and 2013. While Spaniards saw their wealth dwindle by almost 13,000 euros per person as property plummeted. Greeks saw their wealth decline by almost 17,000 euros for the same reason. In contrast though, Germans and Dutch got richer. Their wealth grew by 19,000 in Germany - and 33,000 in the Netherlands. CIBC's Jeremy Stretch. (SOUNDBITE) (English) CIBC, JEREMY STRETCH, SAYING: "Those that are wealthier have done best, particularly those who own assets and in particular financial assets, because they've rebounded very substantially. That's not to say the process of re-injecting liquidity in the global system has proved to be inadequate, I think it's just the case that the benefits have been rather unequally spread around. And unfortunately that's just one of the legacies of the financial sector crisis." The ECB has acknowledged the divide, but there is little the central bank can do to remedy it. Its money-printing scheme is spread out according to countries' relative size and not by their economic needs. To fix imbalances, experts have long pushed for a system of financial transfers or payments from rich to poor states. But Germany fears this could lumber it with unmanageable costs - and believes handouts would discourage some countries from economic reforms.

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ECB highlights post-crisis wealth gap

Wednesday, October 21, 2015 - 01:42