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Guntram B. Wolff

Guntram B. Wolff

Guntram Wolff has been the Director of Bruegel since June 2013. His research focuses on the European economy and governance, on fiscal and monetary policy and global finance.

Articles by Guntram B. Wolff

The EU needs a bold climate strategy

July 19, 2019

Scientists report that global temperature increases must be limited to below 1.5 degrees Celsius. With global greenhouse gas emissions continuing to increase and rising temperatures driving up the frequency of extreme weather events, the world needs a greater commitment to climate policy.

In order to avert catastrophic climate change for the entire human population, global temperature increases must be limited to below 1.5 degrees Celsius. Scientists have shown that achieving net-zero carbon emissions before 2050 is essential to this achievement, which has become a key goal of the Paris agreement. But as global greenhouse gas emissions continue to increase and rising temperatures drive up the frequency of extreme weather events, the world needs to commit much more to climate policy.

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Promoting sustainable and inclusive growth and convergence in the European Union

April 8, 2019

This speech was delivered by Guntram Wolff at the Informal ECOFIN Meeting in Bucharest on 5 April 2019.
By:
Guntram B. Wolff
Date: April 8, 2019
Topic: European Macroeconomics & Governance

This speech, based on the Policy Contribution by Maria Demertzis, André Sapir and Guntram Wolff, was delivered by Guntram Wolff at the Informal ECOFIN Meeting in Bucharest on 5 April 2019.

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What does a possible no-deal Brexit mean?

January 24, 2019

With Brexit getting closer, it is still extremely difficult to predict which one of the possible outcomes will materialise. Guntram Wolff examines what exactly it would mean for the UK to ‘crash out’ of the EU, for both parties.
By:
Guntram B. Wolff
Date: January 24, 2019
Topic: European Macroeconomics & Governance

This article was published by Caixin.

On March 29th 2019, two years will have passed since the United Kingdom notified the EU of its intention to withdraw from the European Union. As it stands, the UK will then become a third country and cease to be a member of the EU.
With the deadline getting closer, it is still extremely difficult to predict which one of the four possibilities will materialise: (1) the UK

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The implications of no-deal Brexit: is the European Union prepared?

January 14, 2019

The author, based on a note written for the Bundestag EU Committee, is exploring the possible consequences of a no-deal Brexit for the EU, assessing preparations on the EU side and providing guidance on the optimal strategy for the EU, depending on the choices made by the United Kingdom.
By:
Guntram B. Wolff
Date: January 14, 2019
Topic: European Macroeconomics & Governance

This Policy Contribution, based on a note written for the Bundestag EU Committee, explores the possible consequences of a no-deal Brexit for the European Union and assesses preparations on the EU side. It also provides guidance on the optimal strategy for the EU, depending on the choices made by the United Kingdom.
Overall, a no-deal Brexit would be

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The implications of no-deal Brexit: is the EU prepared?

January 14, 2019

Hearing on Brexit in the EU Committee of Bundestag on 14 January 2019, exploring the possible consequences of a no-deal Brexit for the EU and assessing preparations on the EU side.
By:
Guntram B. Wolff
Date: January 14, 2019
Topic: European Macroeconomics & Governance

This note, written at the request of the Bundestag EU committee, explores the possible consequences of a no-deal Brexit for the EU and assesses preparations on the EU side. It also provides guidance on optimal strategy for the EU assuming different choices taken by the UK.
Overall, a no-deal Brexit would be disruptive in the short-term.
There would be immediate very significant administrative and logistic challenges in trade. Preparations to reduce those

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How could Europe benefit from the US-China trade war?

October 18, 2018

Versions of this article have also been published by Caixin, Die Zeit, Nikkei and Politico.

The European Union and Donald Trump got off to an awkward start. Initially, the U.S. president seemed to want to take on the world, confronting China and his country’s long-time allies alike.
More recently, however, tensions between the U.S. and the Europe have calmed — especially as Trump has turned his focus squarely on China. This provides the EU with an important opportunity it must not waste — to use the pressure on China to more clearly set the rules of engagement with Beijing.
There are many reasons why Trump may have shifted his crosshairs. They include worries about Beijing’s rise and the perception that competition from China has cost the U.S. jobs in important economic

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Overcoming the hurdles to Italian Growth

September 4, 2018

Now is the time for refining recommendations and for a serious political debate on how best to overcome bottlenecks and improve the economic prospects of Italians.
By:
Guntram B. Wolff
Date: September 4, 2018
Topic: European Macroeconomics & Governance

This opinion piece was also published in La Repubblica

As the Italian government is contemplating its budgetary policy, it is useful to look at other countries’ experiences in how to deal with high debt levels. A salient example is Belgium as my colleague André Sapir is pointing out in an upcoming paper for Bruegel. Belgium and Italy both had comparable debt to GDP ratios in the early 1990s. But in Belgium the debt ratio declined by 51 points of GDP between the peak (of

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Germany’s Government Still Has an Allergy to Investing

July 23, 2018

The new coalition budget looks a lot like the old German coalition budget.
By:
Guntram B. Wolff
Date: July 23, 2018
Topic: European Macroeconomics & Governance

This opinion piece has been published in Bloomberg
 

Germany’s new government is composed of the same two parties as its previous one, but many in Germany and outside expected one major change: more government spending. Olaf Scholz, the new finance minister, comes from the Social Democratic Party, which heavily campaigned on a promise of more investment and growth in Germany.
And yet Scholz’s first budget suggests those hopes were misplaced: The Scholz plan looks almost identical to that of the previous minister, Christian Democrat Wolfgang Schaeuble. Despite the

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A Brexit deal is still not achieved

July 13, 2018

The UK paper should be seriously considered. While it breaks a number of European red-lines, it is also an attempt to solve some issues. The question is whether the EU will be ready to seriously negotiate. Geostrategic considerations suggest that it is time for the EU to do so.
By:
Guntram B. Wolff
Date: July 13, 2018
Topic: European Macroeconomics & Governance

Brexit has again been a major news topic over the past week. After the British cabinet agreed to a Brexit plan at its Chequer’s meeting, two of the loudest Brexit proponents – the secretary in charge of the Brexit negotiations, David Davies, and the foreign secretary, Boris Johnson – stepped down. Both gave as a primary reason that the Chequer’s agreement would not

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Griechenland braucht einen Neuanfang

July 3, 2018

This was first published by Die Zeit. Acht Jahre nach Beginn des ersten Hilfsprogramms für Griechenland ist es soweit – Griechenland soll wieder auf eigenen Füßen stehen. Die Eurogruppe soll heute das Ende des dritten Hilfsprogramms beschließen und die Modalitäten für die Zeit danach definieren. Ziel sollte es jetzt sein, einen tragfähigen Ausstieg aus dieser für alle Seiten […]
By:
Guntram B. Wolff
Date: July 3, 2018
Topic: European Macroeconomics & Governance

This was first published by Die Zeit.

Acht Jahre nach Beginn des ersten Hilfsprogramms für Griechenland ist es soweit – Griechenland soll wieder auf eigenen Füßen stehen. Die Eurogruppe soll heute das Ende des dritten Hilfsprogramms beschließen und die Modalitäten

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Die Unternehmensteuer muss reformiert werden

July 3, 2018

Der deutsche Kapitalstock schrumpft. Das liegt zum einen an sinkenden Investitionen von Unternehmen. Eine Reform der Unternehmensteuer könnte helfen.
By:
Guntram B. Wolff
Date: July 3, 2018
Topic: European Macroeconomics & Governance

Deutschland benötigt dringend eine private und öffentliche Investitionsinitiative. Seit Mitte der 1990er-Jahre hat sich Deutschlands Kapitalstock nur sehr schwach entwickelt. Während dieser in den USA um fast 70 Prozent gewachsen ist und in der gesamten Europäischen Union um über 45 Prozent, stieg er in Deutschland um nicht einmal 30 Prozent. Vergleicht man die Entwicklung des Kapitalstocks seit 1995 in den 28 EU-Staaten, liegt Deutschland somit auf dem vorletzten Platz.
Ein Grund liegt in der

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Trägt Deutschland eine Mitschuld an Italiens Krise?

June 6, 2018

Italiens Regierung will riesige neue Schulden machen – die nächste Bewährungsprobe für die Eurozone. Deutschland muss sich aktiv an der Lösung beteiligen.
By:
Guntram B. Wolff
Date: June 6, 2018
Topic: European Macroeconomics & Governance

This opinion piece has been published in Zeit

“Italien hat mal wieder eine Krise – aber mit uns hat das Ganze nichts zu tun”: So lautet der fast einstimmige Tenor vieler Diskussionen zu den dramatischen politischen Entwicklungen in Italien in den vergangenen Wochen. Aber ist diese Einschätzung denn richtig oder trägt Deutschland nicht zumindest eine Mitschuld?
Richtig ist: Die italienische Politik ist chaotisch und gibt Anlass zur Sorge. Zunächst sah das Regierungsprogramm der

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What does Europe care about? Watch where it spends

May 14, 2018

The European Union says it wants to focus on new priorities. First it will have to cut spending in sectors that have long enjoyed support.
By:
Guntram B. Wolff
Date: May 14, 2018
Topic: European Macroeconomics & Governance

This article was published first by Bloomberg, on March 21st 2018.

“Don’t tell me what you value,” Joe Biden once said. “Show me your budget, and I’ll tell you what you value.”
He wasn’t talking about the European Union, obviously, but it’s a great line that’s as telling today in Europe as it was when he used it to criticise Washington Republicans in 2008.
Negotiations on the next seven-year budget cycle lasting from 2021-27 began recently. The European Commission says an enlarged trillion-euro ($1.23

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Germany’s current account surplus and corporate investment

May 9, 2018

Following the 1990s post-reunification period and since the beginning of monetary union, Germany’s current account has grown substantially. In the crisis years, Germany’s lost about 15 percentage points of GDP in its external investments, but the position continues to grow nevertheless. What are the drivers behind Germany’s current account surplus?
By:
Guntram B. Wolff
Date: May 9, 2018
Topic: European Macroeconomics & Governance

Germany’s current account surplus is unusually, and persistently, large. It was above €250 billion euros in 2017, the third consecutive year with a current account surplus above 7.8% of GDP (IMF 2017). To put this into context, of the 193 countries listed in the IMF’s World Economic Outlook between

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Europe needs a broader discussion of its future

May 4, 2018

When thinking about what will determine the prosperity and well-being of citizens living in the euro area, five issues are central. This column, part of VoxEU’s Euro Area Reform debate, argues that the important CEPR Policy Insight by a team of French and German economists makes an important contribution to two of them, but leaves aside some of the most crucial ones: European public goods, a proper fiscal stance and major national reforms. It also argues that its compromise on sovereign debt appears unbalanced.
By:
Guntram B. Wolff
Date: May 4, 2018
Topic: European Macroeconomics & Governance

This opinion piece has been published in VoxEU
This column is a lead commentary in the VoxEU Debate “Euro Area Reform“

When thinking

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How Should the EU Position Itself in a Global Trade War?

April 5, 2018

It is high time for the EU to work on more than just wishful thinking in response to the US challenge to global trade. With the first cracks appearing in the multilateral system, it will be difficult for the EU to maintain a middle course between the US and China.
By:
Guntram B. Wolff
Date: April 5, 2018
Topic: European Macroeconomics & Governance

The last meeting of the European Union’s heads of state or government, the European Council of 22-23 March, was dominated by worries about the future of global trade. Since President Donald Trump’s announcement to impose tariffs on steel and aluminium imports and the granting of a temporary exemption to the EU, South Korea and number of other countries, the old trade order based on

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Europe needs a strong Italy

March 20, 2018

Europe needs to have its Italian voice. A stable government is required not only to pursue domestic policies and remain fiscally prudent but also to negotiate on euro-area reform, priorities in the EU budget and intensifying competition in global trade.
By:
Guntram B. Wolff
Date: March 20, 2018
Topic: European Macroeconomics & Governance

This opinion piece has been published in:

All eyes turn to Italy, in the wake of the country’s recent elections; neither Italy nor Europe can afford for it to take as long as in Germany to form a new government.
There are obviously domestic reasons why Italy needs a stable government. The elections reveal a country that is not only disenchanted with the political establishment – not an

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Future of EMU

March 9, 2018

On 8 March 2018, Guntram B. Wolff discussed the opportunity and options to upgrade the European Monetary Union in his Testimony at the Swedish Parliament’s – Committee on Finance. The author is analysing the current situation of the EMU and make recommendations on how and why stability mechanism should be implemented.

What is the future of the EMU, what remains to be done, desirable clarifications on programmes and how to get the balance right.
Bruegel’s Director Guntram B. Wolff presenting to the Swedish Parliament’s – Committee on Finance his work on the future of EMU.

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US tax reform and implications for the German coalition agreement

February 7, 2018

Major recent reform of US tax laws represents a serious challenge to Germany, highlighting several weaknesses in the country’s economy. The formation of Germany’s coalition government represents an opportunity to discuss its own tax changes, which could remedy current problems and stimulate a sustainable domestic boom.

A version of this article is published by Caixin.

In the wake of the recent passing of major reforms to US tax laws, the European Union and Germany urgently need to discuss the implications of the new measures for their own tax system.
Beyond the income tax changes, the reform reduces the tax burden on corporate profits and, importantly, puts in place a 100% expensing rule for capital investments. As a result, the US will likely become more attractive as a place to

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Difficulties and opportunities in reallocating European Parliament seats after Brexit

February 5, 2018

The European Parliament must carefully consider the reallocation of seats after Brexit, allowing for a potential shift in political alignment and working within parameters already agreed with Member States
By:
Guntram B. Wolff
Date: February 5, 2018
Topic: European Macroeconomics & Governance

The European Parliament will soon recommend to the European Council a new distribution of parliamentary seats per Member State after Brexit. In the UK, 73 MEPs are elected; their seats in the Parliament can either be dropped or reallocated to other countries. This potential reallocation is hugely important for Europe – not only could it change political majorities in the European Parliament, it will also affect representativeness with

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Your job description, Mr. Centeno

January 30, 2018

Here’s how you run the Eurogroup.
By:
Guntram B. Wolff
Date: January 30, 2018
Topic: European Macroeconomics & Governance

This opinion piece was also published by Negocios, POLITICO Europe, Kathimerini, and La Repubblica.

Dear Mr. Eurogroup president,
Congratulations! You’re taking on a major challenge. You’ll preside over the Eurogroup — arguably the most powerful and decisive body for the euro area. Besides meeting monthly with the currency zone’s 18 other finance ministers, you’ll spend countless hours on the phone with European leaders to attempt to forge consensus on highly sensitive issues — all while keeping up your duties as Portugal’s finance minister.
Allow me to give you a little advice, as you take on this

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Franco-German relations facing the challenges of the EU

January 25, 2018

A resilient Euro needs Franco-German compromise
In a piece signed by 15 leading French and German economists, Nicolas Véron lays out a path to a more sustainable Euro. Germany will need to accept some form of risk sharing. France will need to allow more market discipline. But the two countries can find a common vision for reforms

By: Agnès Bénassy-Quéré, Markus K. Brunnermeier, Lars Feld, Philippe Martin, Hélène Rey, Isabel Schnabel, Nicolas Véron, Beatrice Weder di Mauro, Jeromin Zettelmeyer, Henrik Enderlein, Emmanuel Farhi, Clemens Fuest, Pierre-Olivier Gourinchas, Jean Pisani-Ferry and Marcel Fratzscher
Topic: European Macroeconomics & Governance
Date: September 27, 2017

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Opportunities and risks in Europe in 2018

December 30, 2017

The new year could very well see the positive story of 2017 continue in Europe – but a number of looming policy and political problems cannot be ignored.
By:
Guntram B. Wolff
Date: December 30, 2017
Topic: European Macroeconomics & Governance

This opinion piece was also published in Nikkei Veritas

As 2017 draws to a close, it is a good moment to review the main risks for the upcoming year and explore some of the opportunities. Let’s start with the opportunities: 2017 has been a good year for the global and the European economy. GDP growth numbers have been revised upwards in Europe with the notable exception of the United Kingdom. Unemployment has been falling rapidly while employment is at an exceptionally high level.

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The European Commission should drop its ill-designed idea of a finance minister

December 4, 2017

Beyond the opposing ideas of Jean-Claude Juncker and Wolfgang Schäuble for future euro-area governance, Guntram Wolff explores how alternatives such as a reformed Eurogroup might yield more effective fiscal policy-making.
By:
Guntram B. Wolff
Date: December 4, 2017
Topic: European Macroeconomics & Governance

European Commission president Jean Claude Juncker has announced the creation of a European finance minister position. In his vision, outlined by his “state of the union” address in September, the role would unite the position of Commission vice president, chair of the Eurogroup and head of the euro-area portion of the EU budget.  But the proposal is ill-designed and will create more problems than it solves.
Such a

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Beyond the Juncker and Schäuble visions of euro-area governance

December 1, 2017

Two diametrically opposed visions of the euro-area architecture have been put forward. Departing from both Juncker’s and Schäuble’s proposals, the author identifies new ideas to develop the euro-area governance
By:
Guntram B. Wolff
Date: December 1, 2017
Topic: European Macroeconomics & Governance

The issue
Two diametrically opposed visions of the euro-area architecture have been put forward. European Commission president Jean-Claude Juncker favours a model that puts the Commission at the centre of fiscal policy decision-making. The former German finance minister Wolfgang Schäuble argues that fiscal surveillance should be centred on a reformed European Stability Mechanism. Juncker’s proposal would over-emphasise the

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German wages, the Phillips curve and migration in the euro area

November 29, 2017

This post studies why wages in Germany have not borne strong increases despite a relatively strong labour market. I list four reasons why announcing the death of the Phillips curve – the negative relationship between unemployment and wage growth – is premature in Germany. One of the reasons I report is substantial immigration from the rest of the EU.
By:
Guntram B. Wolff
Date: November 29, 2017
Topic: European Macroeconomics & Governance

An important debate in the blogosphere concerns the possible death of the Philipps curve – i.e. the empirical relationship between inflation or wage growth on the one hand and the amount of slack in the labour market on the other hand. European Central Bank president Mario Draghi has

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A Jamaican Germany is good for Europe

September 29, 2017

After a surprising election result, Europe is closely watching German coalition negotiations. A so-called Jamaica coalition of conservatives, liberals and greens is the most likely outcome, but many fear this will be bad for the EU and the Eurozone. Not so, argues Guntram Wolff. In fact, a shift to Jamaica could be good news for Europe.
By:
Guntram B. Wolff
Date: September 29, 2017
Topic: European Macroeconomics & Governance

European eyes are now on the German coalition negotiations. Last weekend’s election saw support for the two mainstream parties fall and a breakthrough for the far right Alternative for Germany. Many observers worry that an unstable coalition, or too much power to the liberal but increasingly

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G20 climate commitments must be turned into action

August 17, 2017

The G20 is just about holding together in difficult times, but the world’s leading economies need to make good on their climate promises. Major projects such as China’s One Belt One Road initiative and the G20 Compact for Africa must incorporate sustainability criteria, or it will be impossible to meet the Paris goals.

This opinion piece was also published in Caixin, Capital, Dienas Bizness, Expansión, Hospodárske Noviny, Jyllands-Posten, Kathimerini, Nikkei, Nikkei Asian review and Público.

After Hamburg’s recent G20 meeting, what will remain beyond bitter memories of shameful rioting? There was a remarkable show of unity on trade, Africa, women’s empowerment and many other issues. But the G20 was not united on climate change. The United States refused to sign a

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Eurozone or EU budget? Confronting a complex political question

June 29, 2017

This week’s European Commission reflection paper is the latest document to ponder a distinction between EU and euro-area budgets. But do we need to split the two, and what would each budget be used for? In this post, I present an analytical framework for assessing this ultimately political question
By:
Guntram B. Wolff
Date: June 29, 2017
Topic: European Macroeconomics & Governance

The European Commission has just published its reflection paper on the future of the EU budget. It touches on many topics, but at its heart the paper is agonising over one political question: Should there be a euro-area budget distinct from the overall EU budget? And if so, what kind of interplay will there be between the two? Do really we

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What could a euro-area finance minister mean?

May 17, 2017

The idea of a euro-area budget and finance minister have been around for a long while, but the arrival of President Macron gives the proposals new impetus. Why might the euro area need a budget, and what would it do? There are various visions, some more convincing than others.
By:
Guntram B. Wolff
Date: May 17, 2017
Topic: European Macroeconomics & Governance

With the election of Emmanuel Macron as president of France, the idea of a euro-area treasury and finance minister is back in the limelight. The election programme of Emmanuel Macron calls for “a budget for the euro area voted by a euro-area parliament and executed by a euro-area finance minister” with the aim to “be able to invest much more than currently”.
This

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