Using the recently developed 'bounds' testing approach, this article provides evidence that Cyprus is not in violation of its intertemporal budget constraint and its current account balance is 'strongly' sustainable in the long-run. A policy implication of these findings is that the loss of...

The paper contributes to the discussions on fiscal governance in Europe. It takes stock of recent reforms, identifies areas for further progress, and discusses a menu of policy options for the medium-term. The issues covered include: (i) the growing complexity of the European framework and ways...