CERNOBBIO, Italy, Sept. 7 (Xinhua) -- The European Central Bank (ECB) bond-buying plan announced on Thursday might be the beginning of "moving away from the bottom," but there is still a huge way before the eurozone start recovering from the crisis, American economist Nouriel Roubini said here on Friday.
"The eurozone's policy makers have realized they need to move towards an economic union ... where growth is restored," Roubini, an economics professor at New York University, said at the Ambrosetti economic forum in northern Italy.
The ECB willingness in trying to reduce spreads between borrowing costs "potentially is positive, but within the ECB there are many forces .. that are skeptical about the program," said the economist, mainly known for having forecast the 2008 financial crisis.
The eurozone crisis is still "deep and ongoing," and could even become "more disorderly" in an international context where the U.S. economy was showing weaker performance and the slowdown of emerging markets' growth was accelerating, he said.
In his view, there is the risk that weaker economies such as Spain "fall off the cliff even with the support of the ECB," which may not be able to continue to purchase bonds of countries that have fundamental economic problems.
"Spain is in deeper trouble than Italy and most likely has to ask for the EU rescue funds and ECB support," Roubini said, adding that in the case of Italy "things are borderline."
He said although Italy has now a "solid government with sophisticated ministers who know what needs to be done," things cannot change overnight. It will take a decade to reverse the decline of growth which has been flat, and "a lot of things can go wrong in the meanwhile."
He also added that a second mandate for the current Italian Prime Minister Mario Monti is possible. However, any new government coming out from elections scheduled in 2013 will have no alternative but to continue with Monti's austerity program, he said.
According to the economist, "the question is if things become bumpier for Spain, whether markets are going to decouple Italy from Spain," which will partly depend on what the two countries do but also on the eurozone's sentiment as a whole.
"So I think what the ECB has suggested was a step in the right direction, but is not a game changer by itself," he said.
Roubini said that restoring growth, debt sustainability, competitiveness, external balance and job creation in the single currency region are challenging objectives that require a "change of power from national states to the center."
It is by thinking and acting as a whole body that Europeans can fight balkanization (the process of division of a region into smaller parts non-cooperative to each other) of their economies and avoid break-up, he said.
The three-day forum, which was started in 1975 and traditionally takes place behind closed doors, is an annual international economic conference held at a prestigious location in the Italian town of Cernobbio on the shores of northern Como lake.
The conference, which brings together distinguished leaders, professors and businessmen to discuss forecasts of the economic and geo-political outlooks for the world, attracts hundreds of Italian and international journalists.
Forum participants, typically business leaders from major Italian and international corporations, are privately invited.
Among speakers participating in this year's edition which kicked off Friday, there will be the European Council President Herman Van Rompuy, Israeli President Shimon Peres, the CEO of the European Financial Stability Facility (EFSF) Klaus Regling, former President of the Executive Council of Hong Kong Donald Tsang and the senior U.S. senator from Arizona John S. McCain III.
Monti will also take part along with several ministers of his technocratic government.