24/1/11

The Future of Euro-zone by Dinos Stasinopoulos, formerly with the European Commission

  
Δευτέρα, 24 Ιανουάριου 2011 22:38
The Euro-sceptics of London and the neo-cons of New York and Washington have been lately predicting the collapse of the Euro-zone area as it relates to Greece, Ireland and Portugal.
There are of course huge economic strains for the weaker member states of the Εuro-zone but despite the crisis no country is about to leave the single currency. Talks of the demise of Euro are   premature. The Euro is here to stay. It's end is not in sight. As Paul Volcker, the x-Chairman of the Federal Reserve of the United States once said following the Asia financial crisis: it is best to be on a big ship when the waters get rough. If there is one lesson to be learned it is that markets are subject to wide swings that can damage the real economy in Europe. Member states know that euro membership provides a safe haven which would mitigate negative impacts of the financial/economic crisis.
Greece, Ireland, Portugal and other Southern European countries are taking austerity measures to deal with  balance of payments problems and reduction of public debts. Germany and other member states with large external surpluses are also taking modest steps to rebalance their economies.
In addition to measures taken by member states national authorities, the European Union is going beyond national solutions. Efforts are being made to present a comprehensive package of measures emphasising Community, but Germany led solutions to fiscal and banking problems. It is hoped that this package of framework of laws, discipline and fiscal austerity will be adopted by the Head of States during the February and March EU Summits.

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