Main focus of Thursday, December 10, 2009

Greek crisis endangers the EU

Greek Prime Minister George Papandreou has declared that the current debt crisis threatens Greece's national sovereignty. New indebtedness is being estimated at roughly 13 percent of the country's gross domestic product, while the national debt also lies far above EU requirements. A situation that could soon mean trouble for all of Europe.

Le Monde - France

The EU must help Greece out of its current economic plight, writes the daily Le Monde: "It could be that the events in Greece signal a key moment in the history of national debts, that is the first payment default of a Eurozone state. In theory the Treaty of Maastricht forbids any assistance for a Eurozone state faced with bankruptcy. In practice it's hard to see how the countries of Northern Europe and the European Central Bank could let a failing economy go under without provoking a major crisis of confidence in the euro. Still it remains to be seen how German, Dutch or French taxpayers will react when their taxes are raised to save the Greeks or the Portuguese. That will be the common currency's first real 'crash test', in other words test of its capacity to stand up to serious accidents." (10/12/2009)

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More from the press review on the subject » International Relations, » EU Policy, » Fiscal Policy, » Tax Policy, » France

NRC Handelsblad - Netherlands

The countries of the Eurozone should not help Greece out of its present crisis under any circumstances, the daily NRC Handelsblad writes: "The problems Greece is experiencing today have little to do with the credit crunch. They are homemade. Financial support for Greece would set a dangerous precedent. The Stability Pact, which prescribes cautious state finances, has already been grossly violated in several cases. The no-bail-out clause [in the Maastricht Treaty] is the only remaining guarantee. There are other euro countries with wobbly budgets that are potentially headed for a financial debacle. Greece is relatively insignificant, but what if the same happened to Italy? It must be made clear that Greece is responsible for its own chaos and that it must clean up its own mess." (10/12/2009)

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More from the press review on the subject » Fiscal Policy, » Greece, » Europe

Frankfurter Rundschau - Germany

In view of the news of crisis from Greece, Dubai and Japan, the left-liberal daily Frankfurter Rundschau criticises the lack of action being taken by the EU: "What exactly has been done in Brussels since February? Has the Eurozone introduced new rules for rescuing countries in difficulty? If so we wouldn't need to fear renewed speculation against the euro. Have hedge funds been regulated and controlled by driving them from tax havens? Have short sales been banned? Of course not. Have our politicians enforced transparency on credit derivatives and subjected them to compulsory exchange trading? Far from it. ... Yet they should know that the risk tolerance of states like Germany or the US is at an end. Billions of dollars for banks, recovery and businesses are no longer on the cards, and the only alternative is state crisis. Anyone who wants to avoid that must take brutal action against financial gamblers, and now." (10/12/2009)

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More from the press review on the subject » Fiscal Policy, » Economic Policy, » Greece
All available articles from » Robert von Heusinger

Sme - Slovakia

The economically hard-hit countries of Central and Eastern Europe could soon be facing the same problems as Greece, the liberal daily Sme writes: "For a long time the Greek risk was taken lightly because the idea of a national bankruptcy with the euro seemed so unlikely. The investors lived in the expectation that the bigger countries like Germany would drag the smaller countries out of the crisis. …But the investors' mass exodus from Greece could easily extend to Central and Eastern Europe, which has been described as the region worst affected by the crisis worldwide. The US, Germany and the UK are in a position to be constantly in debt. Their creditworthiness won't suffer from this. We, on the other hand, must regard each bankruptcy or even the threat of a bankruptcy with great apprehension." (10/12/2009)

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More from the press review on the subject » Fiscal Policy, » Financial Markets, » Greece, » Central Europe, » Eastern Europe
All available articles from » Peter Schutz

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