The majority of CFA members (70%) believe a collapse of the the single currency in the Eurozone would be a disaster but a break-up of the Eurozone is unlikely (63%), according to a new survey conducted by the CFA on the eve of its fourth annual European Investment Conference in Paris.
Only 6% of respondents believe in abandoning the monetary union and returning to national currencies to alleviate the region’s woes, while 48% believe trend growth for Europe’s economies will not return until 2013-2014 at the earliest.
The survey was distributed to members of CFA Institute, the global association of investment professionals, in Europe, and the results reflect the market sentiment of those working in the region.
When asked about possible solutions to the eurozone crisis, more than half of the members (51%) suggested that greater fiscal union, including the creation of a European Ministry of Finance with tax raising powers for the euro area, could help resolve the crisis. Additionally, 61% believe both national governments and the private sector were responsible for the crisis, whereas only 3% believe that the latter is solely responsible.
Nitin Mehta, CFA, managing director for Europe, Middle East and Africa at CFA Institute, says: “This survey of our members is very timely given the serious global economic challenges and the risks of contagion between financial markets worldwide. Whilst it is difficult to predict what may happen to the euro and European markets in the coming months, the respondents remain positive about the longer-term future. Almost two out of three believe that a breakup of the Eurozone is unlikely. Interestingly, over half of the respondents were also of the opinion that countries which default on their sovereign debt should not be removed from monetary union in the eurozone.”
The European Investment Conference will bring together over 300 leading professionals, academics and commentators to assess the risks and investment opportunities that are fast emerging as the result of the financial and economic crisis in Europe. With sessions from over 20 eminent speakers, Simon Johnson, Ronald A Kurtz Professor of Entrepreneurship at MIT Sloan School of Management will open the conference with ‘Are We Now Looking at the Face of Another Depression?’