The battle is won, but the war goes on
Greece bailout program ends, but the EU still can’t handle shocks
I have worked out the ideal solution for the Greek economic crisis a long time ago. But unfortunately, I haven’t had a chance so far to share my wisdom with the decision-makers of the troika. Maybe now that they are all relieved after closing a 10-year-long saga after a marathon Eurogroup meeting at Thursday night.
My recipe for happiness is very simple: we should move all the EU institutions to Athens. The construction work and the rising demand for flats, hotels and restaurants would kick off the economic boom and they would contribute to its sustainability in the long term. We, Eurobubble workers would also be happy to have tons of hours of sunshine and a beautiful seaside in a half-an-hour reach from the office. I can only see one counter-argument for my hilarious scenario: we wouldn’t be able to complain about Brussels weather for twenty minutes as a small talk with new acquaintances.
Apart from daydreaming, this week has really seen a historic Eurozone meeting in Luxemburg. As French finance minister Bruno Le Maire pointed out very optimistically, “the Greek debt problem is behind us”. However, he is only partially right. Because even if the country managed to secure its last 15 billion payment, got some moderate debt relief and therefore can officially quit the bailout program in August, the debt problem has remained with us. The EU is still not able to tackle major asymmetric economic shocks, like the bloc wasn’t able to do so ten years ago at the beginning of the crisis or in the early 1990s, at the creation of the Economic and Monetary Union.
Without denying the faults of the Greek governments in power before the crisis, the Mediterranean country has always been treated during the crisis management as a black sheep. Toying with the idea of Grexit was a convenient way to gain votes from angry taxpayers in Germany as well as to build some sense of unity in the EU, like ECB President Mario Draghi did with his famous “whatever it takes” declaration.
We will see if Greece is able to fit the public debt and GDP growth criteria in the upcoming years. But it is obvious that the country with a population of 10 million people and a moderate economy is not the real problem. The real problem lays behind the absence of any effective tool to help out a country in economic crisis.
French President Emmanuel Macron won elections with the promise of reforming the eurozone, but it turned out to be very soon that his audacious dreams are a bit similar to mine for moving the institutions to Athens. In fact, nothing happened last year due to the difficulties of forming a German government. Now, with the frightening CDU-CSU split over migration, the already moderate plans suggested by Chancellor Angela Merkel this week seem to go in vain.
The upcoming European Council’s summit might be one of the hardest ever. Still, we can hope that if the Eurozone finance ministers could have ended a ten-year-long story this week, the heads of governments and states will be able to finish the other never-ending story of the monetary union next week.