Austerity was essential in tackling the debt crisis in the eurozone, according to European Central Bank boss Mario Draghi.
In an interview with French newspaper 'Le Journal du Dimanche', the top banker said that the world before 2010 was "unreal".
"Our creditors, institutional investors, were not differentiating between credit to Greece and credit to Germany," said Mr Draghi.
"When people began having doubts regarding Greece's solvency, all of that came to an end.
"Austerity was essential, as it was the necessary solution to one of the most serious financial crises that we have ever seen," said Mr Draghi, pictured.
"This crisis has taught us a lesson," he added.
"It has taught us that we cannot generate either sustainable growth or a fair distribution of prosperity by amassing debt.
"It has also forced us to focus on the fundamentals in order to check the solidity of each individual economy."
He said that without the financial crisis, more time could have been spent implementing the structural reforms that have been seen and that austerity could have been accompanied by stimulus measures.
However, he said that in the event, reforms had to be implemented as a matter of urgency and in a "painful manner".
Mr Draghi also said that the region's banks needed to take the kinds of risk that are beneficial to the economy, particularly by lending to small and medium-sized businesses.
Today, he will address a quarterly hearing of the Committee on Economic and Monetary Affairs of the European Parliament.
The ECB president also said that France needed to continue a process of reforms.
"France needs to return to fiscal stability so that firms start to invest again."
Mr Draghi said that unemployment -- especially the jobless rate amongst younger people -- remained the "number-one problem" for governments in the EU.