<h1>Abandon the euro, says Nobel winner: Economist warns of 'lost generation' on dole</h1>
<ul>
	<li><b>Sir Christopher Pissarides once passionately believed in single currency</b></li>
	<li><b>But he's had a change of heart and is now warning it's 'dividing Europe'</b></li>
	<li><b>Cypriot-British economist calls for action to 'restore euro's credibility'</b></li>
</ul>
One of the world’s leading economists will today admit he was wrong to back the creation of the euro – and call for it to be dismantled.

Sir Christopher Pissarides, who won the Nobel Prize for economics in 2010, was once a passionate believer in the benefits of the single currency.

But in an extraordinary change of heart, today he will warn the euro is creating a ‘lost generation’ of unemployed youngsters and is ‘dividing Europe’.

The Cypriot-British economist will call for action to ‘restore the euro’s credibility in international markets’ and to ‘restore the trust that Europe’s nations once had in each other’.

But, in a lecture at the London School of Economics, where he teaches, he will add: ‘Regretfully, I do not see either materialising.’

His comments come days after Christine Lagarde, head of the International Monetary Fund, dismissed claims that the crisis in the eurozone is over.

She said: ‘Can a crisis really be over when 12 per cent of the labour force is without a job? When unemployment among the young is in very high double digits, reaching more than 50 per cent in Greece and Spain?’

Experts believe Europe will never be able to implement the policies required to boost growth and create jobs because of the huge differences between economies across the region.

German taxpayers in particular will not tolerate spending vast sums to prop up failing economies such as Greece and Spain.

Even France, the region’s second-biggest economy behind Germany, is in crisis with the country now labelled ‘the sick man of Europe’.

But with no fiscal union, through which wealthy countries support poorer countries, and the European Central Bank limited in what it can do in a ‘one size fits all’ currency union, the outlook is bleak.

Professor Pissarides, one of the most respected European economists of his generation, has lived in the UK since 1974 and was knighted in June.
He will say that unless there is a dramatic change of policy the euro should be broken up.

‘The euro should either be dismantled in an orderly way or the leading members should do the necessary as fast as possible to make it growth and employment-friendly,’ he will say.

‘We will get nowhere plodding along with the current line of ad hoc decision-making and inconsistent debt-relief policies.

'The policies pursued now to steady the euro are costing Europe jobs and they are creating a lost generation of educated young people. This is not what the founding fathers promised.’

The eurozone economy grew by just 0.1 per cent in the third quarter of the year compared with 0.8 per cent in Britain and 0.9 per cent in the US.

<b>'The euro should either be dismantled in an orderly way or the leading members should do the necessary as fast as possible to make it growth and employment-friendly'</b>

<i>Sir Christopher Pissarides</i>

Unemployment in the single currency region is at 12.1 per cent – meaning more than 19million people in the bloc are out of work

The 65-year-old was instrumental in getting his homeland of Cyprus to join the euro in 2008. ‘I was completely sold on the idea,’ he will say.

‘Back then, the euro looked like a great idea. But it has now backfired. It is holding back growth and job creation and it is dividing Europe. The present situation is untenable.’

Professor Pissarides is the regius professor of economics at the LSE and chairman of its new Centre for Macroeconomics.
<p style="text-align: justify;">He is also European studies professor at the University of Cyprus and chairman of the Council of National Economy of the Republic of Cyprus, one of the eurozone’s most troubled countries.</p>
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