Eurozone Future In Question – OpEd


By Vesnovskaya Maria

Debt problems in Greece have already claimed George Papandreou, and similar problems in Italy have ended the reign of Silvio Berlusconi. The entire Eurozone is desperately trying to find ways to have itself fixed.

Just two weeks ago, an EU summit announced a decision to create a trillion-euro international Eurozone rescue fund. Russia, however, remains skeptical.

Dr Arkady Dvorkovich is a senior economic advisor to President Dmitry Medvedev:

“Russia cannot subscribe to the idea until full clarity has been obtained. At present, only 250 billion euros are available, and there is no word of how the EU is going to raise another 750 billion. In these circumstances, this country prefers to flex its rescue muscle entirely within the IMF.”

Observers believe the matter was discussed between Russian leaders and the IMF head Christine Lagarde when she visited Moscow earlier this week.

In Berlin, meanwhile, there were chilling reports – not helped by official denials from the Chancellery – that the proposed rescue fund’s main proponents Germany and France are mulling initiatives for a two-tier Europe, in which some of the Eurozone’s weaker members would be left out in the cold.

Chief Editor of the Russia in Global Politics journal Dr Fyodor Lukyanov attaches considerable credibility to these reports:

“The Eurozone will have to re-invent itself and to shrink. Indeed, the problems in Greece are now set to be dwarfed by those in Italy, which is a major Eurozone economy. What this means in political terms is anyone’s guess. But ideologically, it spells the death of the long-cherished concept of a closely-knit family within Europe. Some European nations will emerge more equal than others.”

“Another likely victim would be the European Union’s enlargement strategy, aimed at including and bringing peace to the European periphery, where war has been a way of life for a number of centuries. After 15 years of aspiring tor EU membership, the Balkan nations, for instance, are now faced with very uncertain prospects. One large European nation, Ukraine, is losing the main topic of its domestic political discourse. Entering the EU any time soon will now be highly unlikely.”

Chief analyst for the Grandis Capital company Dr Denis Barabanov sees a smaller wealthy Europe as the best way to avert the collapse of the Eurozone and the European Union:

“The nations in Europe’s ‘South’ would be best advised to leave the euro and revitalize their economies by reverting to weakened national currencies. As long as they are inside the Eurozone, they simply cannot compete with Europe’s ‘North’. Countries like Germany continue to swamp them with exports, sending their domestic industries to the scrapheap.”

“The ‘North’, however, may prove unwilling to let the weaker brethren go. Indeed, it derives economic benefits from killing competition in the peripheral European economies.”

At present, only one thing is 100-percent clear: there is no way forward for Europe other than drastic reforms.


VOR, or the Voice of Russia, was the Russian government's international radio broadcasting service from 1993 until 2014, when it was reorganised as Radio Sputnik.

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