The Financial Crisis in the European Union: An Impact Assessment and Response Critique

Abstract

This article assesses the impact of the global economic crisis on the European Union and analyzes the recently enacted and future legislative response to repair the EU financial sector. It closely discusses and critiques the main initial response legislation, the European Economic Recovery Plan, finding that the central regulation contained short-term measures, yet managed to remain within the EU's long-term goals. The article also closely examines the significant risk regulation considerations highlighted by the economic crisis, notably those considerations contained in the De Larosiere Report and the Basel III Framework, and discusses the importance of implementing financial risk regulations to stabilize and revitalize the EU financial sector. Ultimately, the article concludes that the EU's recently enacted legislative measures are consistent with, but also must continue in tandem with, the longterm policies of the EU, while including new and crucial financial risk regulatory measures.