Euro zone countries must "complete" their monetary union by integrating economic policies further and working towards a capital markets union, European Central Bank President Mario Draghi has said.
In an article for Italian daily Il Sole 24 Ore, Mr Draghi said structural reforms were needed to "ensure that each country is better off permanently belonging to the euro area".
He said the lack of reforms "raises the threat of an exit (from the euro) whose consequences would ultimately hit all members", adding the ECB's monetary policy could not react to shocks in individual countries.
He said an economic union would make markets more confident about future growth - essential for reducing high debt levels - and less likely to react to setbacks such as a temporary increase in budget deficits.
"This means governing together, going from co-ordination to a common decisional process, from rules to institutions."
Unifying capital markets to follow this year's banking union would also make the bloc more resilient.
"How risks are shared is connected to the depth of capital markets, in particular stock markets. As a consequence, we must proceed swiftly towards a capital markets union," Mr Draghi wrote.
