Beyond the crisis: prospects for emerging Europe

Abstract:
This Policy Contribution by Zsolt Darvas assesses the impact of the 2008-09 global financial and economic crisis on the medium-term growth prospects of CEES countries, the Caucasus and Central Asia, which starting their economic transition about twenty years ago. Evidence shows that the crisis has had a major impact on the within-sample fit of the models used and that the positive impact of EU enlargement on growth is smaller than previous research has shown. The crisis has also altered the future growth prospects of the countries studied, even in the optimistic but unrealistic case of a return to pre-crisis capital inflows and credit booms.