impact of the global financial crisis on sovereign debt in the european union

At European Union level, the global financial crisis intensified the issue of sovereign debts and member states had to implement a series of fiscal measures in order to reduce the budgetary deficit and public debts, that have peaked in the last decades. These changes were also imposed in the Romanian fiscal system and the effects were felt in particular through increased tax rates or even the introduction of new taxes. 2008 was the year that marked a turning point in the fiscal policy of member states of the European Union from multiple perspectives. The impact of the economic crisis was felt mainly through the drastic decrease in tax revenues for all member states, which led to an accelerated growth of the budgetary deficit and implicitly of the indebtedness degree. In this context, EU member states were forced to adopt measures that would reduce the budgetary deficit (increases in some taxes and reduction of certain public expenditures). In 2010, the sovereign debt crisis in the euro area exposed the weaknesses of the EU economic governance. In response, the so-called "six pack" regulations were introduced in December 2011. Moreover, many countries have intensified their consolidation efforts in an attempt to regain the confidence of financial markets. The new architecture of fiscal policy in the European area has undergone many changes in recent years, market not only by the fiscal harmonization process, but mainly by the temptation of fiscal coordination that aims mainly to achieve fiscal stability and reduce medium and long-term public debt. The excessive growth of countries' indebtedness degree in recent years led to the need to study the sustainability of the indebtedness policy, considering that maintaining the budgetary deficit at a prudent level would also ensure the sustainability of fiscal policy. The study analyzes the effects in budgetary plan of economic recovery measures by highlighting the evolution of public debt in EU member states. In recent years was spoken increasingly about a sovereign debt crisis in PIIGS countries (Portugal, Italy, Ireland, Greece and Spain) as the level of public debt exceeded 100% of GDP.