Blogging about Europe

Archive for the tag “germany”

Merkel: Our generation must create a political union in Europe

Step by step, Europe needs to move towards political union, said German Chancellor Angela Merkel. She define the debt crisis in the euro area as “the most serious challenge for the region after World War II.”

With its one-hour speach infront thousands of delegates of the Christian Democratic Union, Merkel did not offer new ideas to solve the crisis, which forced Greece, Ireland and Portugal to seek international financial assistance and pose existential concern for monetary union as a whole.

Merkel, however, clearly pointed out that Germany will have to make additional sacrifices. Party congress in Leipzig runs under the motto “For Europe – for Germany.”

“The challenge of our generation is to finish what we started in Europe, and namely the step by step to create a political union,” she said infront of the party congress in Leipzig. “Europe is experiencing one of its worst crises, perhaps the worst since the Second World War,” she said.

The focus on the two-day party meeting had to be the German education system. Instead, the talks were dominated by issues of European debt crisis, which continued to grow even after the election of a new expert governments in Greece and Italy.

If Germany does not have early parliamentary elections, the mandate of Merkel, who came to power in 2005, will expire in 2013. The German Chancellor seems aware that she can easily become another victim of a political crisis if she fails to play her cards cleverly enough.

In 1999, exactly the Christian Democratic Union, led by then-Chancellor Helmut Kohl united Germany to the Pact for the euro.
Almost 13 years later, many German conservatives are worried about the funded with taxpayers’ money aid for troubled eurozone countries. Conservatives are extremely sensitive to the fiscal irresponsibility of the countries of the periphery of the euro area and the danger to the crisis to compromise the independence of the European Central Bank (ECB).

Some fractions of the party of Merkel even agree that the whole project with the European single currency was a mistake that must now be corrected.

Merkel, however, highlighted that Germany has a responsibility to their partners and that it is vulnerable if other eurozone countries are overtaken by the crisis. Chancellor reminded her colleagues that 60% of German exports go to the European Union (EU).

“Irish problems are Slovakian problems, Greek problems are Dutch problems, the Spanish problems are our problems,” said Merkel. “Our responsibility does not end at the German border,” she said.

Meanwhile, Merkel emphasizes that there are “red lines” that Germany is not ready to cross, rejecting once again the idea of ​​issuing common Eurobonds and other hasty decisions that in Berlin would not encourage European governments to adhere to responsible fiscal policy.

The problem is that the crisis was not created overnight, but it is result of decades of mistakes. Therefore we can not resolve it by waving a magic wand, says Merkel. “We are facing a long and difficult road,” she added.

If the crisis deepened in the euro zone before the next elections in Germany in which one or more countries are forced to leave the union – an event with serious economic consequences for the region as a whole, even the most skillful political maneuvering would not save Chancellery chair.

The fate of the euro area is in the hands of Germany

The fate of the euro is in the hands of Berlin, writes, “Daily Telegraph”. The decision of the Italian Parliament to adopt measures to cut government spending, less calm the market, but the crisis in the euro area is not over, says the publication cited by Cross .

British Prime Minister David Cameron said that eurozone countries must take urgent measures, not just react to what happens in the market.

First, it is vital that the eurozone to reduce its budget spending. Moreover, economists believe that the package of aid to countries that have suffered most from the crisis should be increased to 2 trillion. euros, as this will calm the markets.

But the essence of the problem is that the eurozone as a whole and Germany in particular, refuse to recognize that only the creation of monetary union can lead to certain results.

German economy is the largest in Europe. Now stands before her selection. Firstly, it can insist on a fundamental integration of the area where the EU will control budgets and taxes, as markets are concerned only the situation in some countries but not in the eurozone as a whole.

Another point is that she just might leave the eurozone.

The third option is Germany just waiting for the next financial crisis. Ireland, Greece or Italy will be able to solve their problems. Now everything is in the hands of Germany, said the publication.

Post Navigation