The problems plaguing Europe show no signs of abating, which could have a negative impact on the Australian economy, ANZ chief executive Mike Smith has claimed.
During a speech in Sydney late last week, Mr Smith said “the problems in Europe are going to take many years to work through.”
"Despite the relative calm that has followed the Greek bailout, the basic problem still hasn't been resolved - which is, the economies of Greece, Portugal, Spain and Ireland simply aren't competitive while they are part of the Eurozone,'' he said.
While Australia remains fairly well shielded from any problems in Europe thanks to its strong ties to the Aisan markets, Mr Smith said another meltdown abroad would inevitably “shake Asia”.
But while Mr Smith believes the problems in Europe have only just begun, not everyone shares this thought.
AMP chief economist Shane Oliver told Real Estate Business' sister title The Adviser that the chance of another recession in Europe had been “substantially reduced”.
“It’s better than we expected, it turned out to only be a mild recession.”