The Red Cross has said that Europe is sinking into a protracted period of increasing poverty, mass unemployment, greater inequality and despair as a result of the austerity policies adopted by most European nations in response to the currency crisis that has been recently hailed as ‘over’.
“Whilst other continents successfully reduce poverty, Europe adds to it,” says a 68-page report from the International Federation of Red Cross and Red Crescent Societies which was published on Thursday morning and printed in the Guardian newspaper. “The long-term consequences of this crisis have yet to surface. The problems caused will be felt for decades even if the economy turns for the better in the near future … We wonder if we as a continent really understand what has hit us.”
The assessment by the world renowned charity seems more believable than the recent comments made by economists and European leaders that the region is on track for a recovery. On Thursday economic data showed that industrial production in Italy fell yet again in August, France’s industrial output continues to decline on a yearly basis and output in Finland weakened again.
Unemployment meanwhile continues to rise in the worst affected regions of the Eurozone. Data released on Thursday showed that the unemployment rate in Greece rose again to 27.6% in July making the number of Greeks out of work rise to 1.36 million. The conservative-led government expects modest jobs growth next year. But even then, it forecasts unemployment to remain high, at an average 26% compared with 27% for this year. The biggest labour union, the GSEE however, has painted a much darker picture and expects unemployment to exceed 30% in the coming years.
The woes for Greece were heightened last night after the Greek parliaments budget office said that It is an illusion to believe Greece could start borrowing on financial markets again next year, warning its debt will need a further “haircut” or if other words more austerity.
The Red Cross report goes on to say “As the economic crisis has planted its roots, millions of Europeans live with insecurity, uncertain about what the future holds. This is one of the worst psychological states of mind for human beings.
‘We see quiet desperation spreading among Europeans, resulting in depression, resignation and loss of hope. Compared to 2009, millions more find themselves queuing for food, unable to neither buy medicine nor access healthcare. Millions are without a job and many of those who still have work face difficulties to sustain their families due to insufficient wages and skyrocketing prices.
“Many from the middle class have spiralled down to poverty. The amount of people depending on Red Cross food distributions in 22 of the surveyed countries has increased by 75% between 2009 and 2012. More people are getting poor, the poor are getting poorer.”
The Euro meanwhile has strengthened after the European Central Bank made a deal with the People’s Bank of China agreed to establish a bilateral currency swap line which will boost access to trade finance in the Eurozone and strengthen the international importance of the Yuan. The currency also benefitted after the ECB said in its monthly report that it will keep rates low in order to support economic activity in the Euro area.
Euro (EUR) Exchange Rates
As of 11:00 am GMT
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3524
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8485
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4333
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6380
The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.4056
The Euro/ Japanese Yen Rate Exchange Rate is currently in the region of: 132.2940
The Euro/Swiss Franc Exchange Rate is currently in the region of: 1.2314
The Pound Sterling/ Euro Exchange Rate is currently in the region of: 1.1787
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7395
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6974
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6104
The Canadian Dollar/Euro Exchange Rate is currently in the region of: 0.7114
Swiss Franc/Euro Exchange Rate is currently in the region of: 0.8120
