Withdrawals can save Eurozone

Risk premiums on European government bonds rose considerably on Tuesday, including for the first time those on the securities of Finland, Austria and the Netherlands, all of which have very high ratings. To save the monetary union the pros and cons of reducing the size of the Eurozone should at least be seriously considered, writes the liberal-conservative daily Die Presse: "Some legal experts say it might be possible to convert back to the drachma or lira at the original exchange rate, and only then devalue the new currency. If that won't work there will be no alternative but a hefty debt restructuring. In any case the costs would be carried by the other euro countries when they bail out their banks. After leaving the euro the crisis countries would nevertheless regain the freedom to adjust their currency to their economic performance. There is still hope things won't go that far, because if individual countries leave the Eurozone it could tear apart the European Union and its financial system. On the long term, however, it might be the only way of saving the euro project."

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