ISSN 2330-717X

Eurozone Governments Change, But Crisis Persists

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By Nawab Khan

Governments have changed in two Eurozone countries facing serious debt crises, Greece and Italy, while a third, Spain, where elections are taking place today, is on the way to change the government.

However, the appointment as premiers of the two technocrats and non-politicians, Lucas Papademos in Greece and Mario Monti in Italy, has not been met with great enthusiasm or raised any expectations that the deep and complex debt crisis in Europe would be resolved any time soon.

In contrast, the European Union, last week, declared that economic recovery in Europe is at standstill and there is a risk that it will get worse, leading to depressive and gloomy comments in the European press.

“The euro has become a divisive rather than a unifying force in Europe,” commented the German weekly paper Die Zeit (The Time). “Europe could fall apart in the same way that it was united, if it remains an elitist project that does not involve Europes citizens,” it warned.

“Greece in collapse, Italy crumbling, and France threatened with slashed credit ratings, all bound up in a looming collapse of the eurozone: thats not enough to glue together the inhabitants of the Old Continent,” wrote a columnist in the Czech paper Hospodarske Loviny (Economic News).

Moreover, EU states are still at odds over their contribution to the much-publicized bail-out fund the European Financial Stability Facility (EFSF).

The crisis has become so insurmountable that ideas are now being floated in Berlin, Brussels and Paris for the creation of two-tier Europe where the rich countries will speed up integration and leave the poorer EU states behind.

Europe has turned to China for help to borrow from its 3 bilion euro foreign exchange reserves but analysts say the Chinese put some conditions like granting Beijing market economy status and lifting of the European arms embargo in exchange for the bailout.

China has also told the Europeans to solve the debt crisis in Greece before it can think of giving a helping financial hand to Europe.

Analysts opine that on the international scene the failure of Europe to deal with its debt and financial crisis is damaging its political influence.

“There was a time when Europeans went to China in gunboats extracting concessions and dictating terms. Today, they are arriving cap in hand to beg for the money to bail out their indebted governments,” commented the Indian paper Business Standard.

Turkey’s former ambassador to the EU, Volkan Bozkir, has described the EU as a spent force in world affairs.

Speaking at a business congress in Istanbul last Friday he commented that “the EU dream has come to an end for the world. There is a paradigm shift. The EU is no longer the same Union that provided comfort, prosperity and wealth to its citizens as in the past.”

KUNA

KUNA

KUNA is the Kuwait News Agency

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