EU BREAK-UP?
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Code : ECC0056
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Region : Europe, Euro-Zone |
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Rise of Euroscepticism in Europian UnionThe public opinion on European Union was on a downward slide, after Six Southern European countries were affected by the Euro crisis that began in 2009. In order to tackle the financial, currency and debt crises, the Southern countries like Spain, Italy, Greece, Portugal and Cyprus went for budget tightening, austerity measures, and spending cuts, and later sought bailouts from rich nations. In doing so, they had to surrender sovereign powers and bow to conditions to rich nation, which led to vertiginous decline in the trust in the EU and Euro... Euro-Zone CrisisThe euro currency, Launched on January 1, 1999, was used by EU 17 (Euro Area) countries and used by more than 331 million people . The term euro came into the beginning after Maastricht summit in February 1992. At the Maastricht summit it was agreed that to join the currency, member states had to qualify by meeting the terms of the treaty in terms of budget deficits, inflation, interest rates and other monetary requirements. Of the EU members the UK, Sweden and Denmark declined to join the currency. More than a decade after the single currency was in use, there were many twists and turns for the countries that use the single currency... |
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Euro-Zone BluesAnalyst and Economists argue that the fundamental problem in the Europe union was the failure of monetary union. James M.Roberts and J.D.Foster opined that the failure of monetary policy in euro-zone and unsustainable load of debt led to a broader economic collapse among southern European countries - Portugal, Ireland, Italy, Greece, Spain and Cyprus. They opined that this could envelop and threaten the greater states...
Way Forward George Soros (Soros) opined that euro crisis has both political and financial dimension . The financial dimensions had three components – a sovereign debt crisis and a banking crisis and divergence in competitiveness. The political dimension was that Germany did not seek dominant position into which it has been thrust and did not accept the obligation and liability and was imposing wrong policies on the euro-zone. Soros compared the role of Germany with that of IMF during the Latin American’s debt crisis in 1982, where Latin America suffered a lost decade...
