Greece Can No Longer Delay Euro Zone Exit
18/05/2012 6 comentarios
After Greek voters rejected austerity in last week’s election, plunging the country into a political crisis, Europe has been searching for a Plan B for Greece. It’s time to admit that the EU/IMF rescue plan has failed. Greece’s best hopes now lie in a return to the drachma (…..) The conclusion is clear: The current strategy to rescue Greece has failed, but at the same time the risks of a withdrawal are shrinking. This makes it all the more important to take advantage of the opportunities of a new beginning, in the interest of both Greece and euro zone. It would make eurozone more attractive to new members, such as Poland, with its strong economy. Foreign Minister Radoslaw Sikorski has already signaled Warsaw’s desire to join the euro zone. If Athens were to leave the euro zone, it would send a message that the fiscal and budgetary rules in the monetary union must be more closely adhered to in the future. It would also make it easier for Europeans to implement necessary resolutions to save the euro. In many countries, the situation in Greece only inflames resistance to bailout funds and aid programs. A comeback of the drachma would change this, so that it comes as no surprise that in Germany, in particular, many people are inclined to take a hard line on Greece. Horst Seehofer, head of the conservative Christian Social Union, the Bavarian sister party to Merkel’s Christian Democratic Union, has long called for a Greek withdrawal, and he now feels vindicated. If Athens were to reintroduce the drachma, it would be “neither the end of the euro nor the end of the EU”. “We must preserve Germany’s economic strength. That’s more important that Greece remaining in the euro zone.” The two other partners in Germany’s ruling coalition are sharpening their tone toward Athens. “Greece only has a future in the euro zone if its debts are consistently reduced and structural reforms are put in place,” says Economics Minister Philipp Rösler, leader of business-friendly Free Democrats. “A softening of, or deviation from, the established programs will not occur.” Volker Bouffier, CDU governor of western German state of Hesse, argues for strictly adhering to the current austerity course. “Greece has already received more money than was paid out under the Marshall Plan”. “Greeks must treat the measures as an opportunity, or else they don’t stand a chance.” But even with a comeback of the drachma, the Greek problem would not be solved by a long shot. A withdrawal from the monetary union would subject the EU to the biggest test in its history. It would have to continue supporting Greeks to prevent the country from descending into chaos and anarchy. One thing is clear: If Greece returns to the drachma, that will be the point when Europe’s work really begins.