According to influential German Chancellor Angela Merkel the only way the Eurozone can come out of the current devastating crisis stronger than it entered it is if all its members commit to action. During a meeting of the Federation of German Industries (BDI) Merkel commented that if the dream of a successful, solvent Europe is to be realised leaders nationwide must power on with harsh reforms and develop more feasible budget policies.
Merkel went on to paraphrase John Donne and acknowledge that Germany is ‘not an island’ entire of itself which can exist independently of wider developments in the European economy. The Chancellor asserted; ‘We are feeling that Germany is not an island. We are an export nation. Forty per cent of our exports go to the euro zone, 60 per cent to the European Union. We can’t disconnect from European and global economic developments.’
She urged Germany’s floundering Eurozone allies to step up to the mark when it comes to repairing their damaged economies.
Merkel also rejected the concept that other nations should be helped by Germany calming its own productivity drive. She stated: ‘We need to take a deep breath to overcome this crisis. We must make the efforts that will allow Europe to come out of this stronger then it went in. There is a lack of confidence on financial markets that some Eurozone states can pay back their debts in the long term. The world wonders how competitive Eurozone countries are’.
Although Merkel did comment on the success of painful reforms in Southern Europe when it comes to converging unit labour costs she inferred it was a partial success and asserted there was still a great deal of work to do.
The German leader also discussed the limited authority of the European Court of Justice with regret and implied that the institution should have been granted more power to intervene in Eurozone budget policies saying; ‘We can’t have support without controls. The two go hand in hand.’
Merkel even had something to say on plans to introduce pan-European banking supervision. Despite recent reports that Merkel had clashed with French President Francois Hollande over the proposed timeline for banking reform the notion that Berlin was holding up the process was neatly sidestepped. Merkel merely proclaimed that Germany wants ‘stronger European banking supervision.’
The Pound to Euro exchange rate is currently trading at 1.2552
The Pound to US Dollar exchange rate is currently trading at 1.6244
The Pound to Australian Dollar exchange rate is currently trading at 1.5545
The Euro to US Dollar exchange rate is currently trading at 1.2940
The Euro to Pound exchange rate is currently trading at 0.7966
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