Tag Archives: European Financial Stability Facility

Can Greek crisis make euro rather than break it?

It may not seem likely as we head toward Thursday’s eurozone summit but the European Union could be thanking Greece in a few years’ time. Granted, the mutual appreciation and back slapping seems a distant dream given the current angst over the debt crisis, with Italy becoming the latest euro country to run into trouble almost two years after Greece became the first member of the single currency area to hit a wall. Yet the crisis has made the European Union, and the eurozone countries in particular, re-examine their economic and monetary union. The euro area is experiencing a make-or-break moment and while there are some who fear the consequences of the debt crisis are so wide and deep they will lead to the breakup of the single currency as we know it, there are plenty who believe, and are working on, this period of turbulence being the moment that really makes the euro.

“What we’re witnessing is that the EU and the eurozone are at a turning point,” says Jens Bastian, a senior economic research fellow at the Athens-based think tank ELIAMEP (Hellenic Foundation for European & Foreign Policy). “The debt crisis is not only forcing the 17 eurozone members to pool their resources in an unprecedented manner but also to readjust economic sovereignty. That was unthinkable just a year ago.”

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Independence Day

Illustration by Manos Symeonakis

Every year, Greece celebrates its independence on March 25. It marks the date when the revolution against Ottoman rule began in 1821. This March 25, though, the proposition of Greece standing on its own will not seem so attractive. Should the European Union leaders’ summit on March 24-25 end in disappointment — as many expect it to — debt-stricken Greece will be left dangerously isolated.

Prime Minister George Papandreou has spent the last few weeks furiously trying to cultivate contacts with his European counterparts — including German Chancellor Angela Merkel, French President Nicolas Sarkozy and European Council President Herman Van Rompuy — in the hope they might be able to sway opinions ahead of the March 25 summit and a meeting of leaders from eurozone countries on Friday, March 11.

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