Thursday, 13 September 2012

A Good Day For Europe

At last, after months of discussions and speculation, the German Federal Constitutional Court has given the green light towards the creation of the European Stability Fund (ESM). This means that the Fund can give up to €500 billion of loans to Member-States in need. In addition to Draghi's announced bond-buying program, this is expected to bring a new era of calm in the markets. However, what is more important is that they are giving out the signal that both the EU and the common currency are here to stay.

In essence, this would mean that all rumors and speculation concerning the fall of the euro, the Union, a sovereign exit or bankruptcy are unfounded. Thus, after these are refuted, stability and calmness is expected to appear on the markets, in contrast to the panic which lasted for almost a year. Nevertheless, not to be forgotten is that individual nations are still struggling to survive
, and for some (Cyprus, Italy and Spain), the worst is yet to come.

Tomorrow, in Nicosia, Cyprus, the Greek Prime Minister, Antonis Samaras, is expected to announce the new austerity measures at the Eurozone finance ministers meeting. Although the flow of cash to Greece is not expected to halt as none of the decision-makers has ever stated such an interest, the Troikans will issue their next report in October where the Greek government is expected to come short of its targets. In the same meeting the situation in Spain is expected to be discussed. Even though a package of €100 billion has been made available
to the country in order to assist its ailing banking system, the actual situation of Spain's banking system is still being reviewed.

The bad news is that although the plan for an EU-wide bank regulation system directly from the ECB is already drafted, Germany and other non-Eurozone countries want to avoid having it implemented from January 2013 as they believe that this time frame is too short. The problem is that they are not proposing something else in its place neither suggesting another date of implementation. As we have seen through our recent experience delays cause only problems in the EU. Although an exact date is not extremely important (unless of course it means moving it to 2020!), delaying it indicates that measures to safeguard the Union are not taking place as fast and as good as we have hoped. 

What gives me great pleasure is none other than the Dutch election results. The pro-European party has been re-elected to govern Holland, and Euro-skeptics as well the right-wing party have seen a large reduction in their seats. What does this mean? Well, Europeans are more pro-European than the media and some politicians have proclaimed them to be. 

I think it is time to distinct people from politicians who claim to be representing them while they are not actually doing such a thing. At last, a harder line has been drawn by EU officials with regards to anti-European comments by individual politicians in individual countries. Politicians will do almost anything to win public support and they will not stop at blaming the EU or other Member-States to achieve that. The problem is, since bad news and comments sell more than good ones, the media will continue to publish more of the former. What we can merely do as the public is to have our ears, eyes and mind open to find the many  inconsistencies and lies these people use in order to persuade. All hope is to the people, and to the youth. Let's hope they do not fall victims to Euro-skeptic or anti-European propaganda.

No comments:

Post a Comment