Friday 13 December 2019

Adrian Hamilton: Greece still a fly in the EU ointment as consensus proves elusive

Adrian Hamilton

Europe is preparing for Greece to leave the eurozone but it doesn't want it to do it. That is the central dichotomy of the summit which ended in Brussels in the early hours of yesterday.

All the pressure put on Germany to change its stance has had the opposite effect. If Germany is to change, if Greece is to be kept in the euro, it is going to have to be through a Europe-wide consensus which will enable Germany to adjust its position and Greece's partners to moderate theirs.

On that score, there's still room for hope, or, at any rate, manoeuvre. One thing that did come out of Europe was that, with Francois Hollande, we have a French leader who is clearly determined to push a growth agenda.

Mr Hollande is proposing a consensual shift which may suit a Germany concerned at faltering growth among its partners and anxious to avoid the role of EU dictator.

You can see the outlines: a further direct bailout of the banks that might be unpopular, but would be more acceptable to German feeling than more extensive bailing out of states; a renewed commitment to fiscal discipline with tighter monitoring; a general growth strategy.

It won't eliminate the worries over Spanish and Italian debt, but, for the markets, a sense of common political purpose is probably more important than impossible targeting.

The fly in the ointment remains Greece. Mr Hollande has so far kept to the austerity script where Greece is concerned. But an early visit to Athens to give hope as well as sober advice could do wonders for the election campaign there and for the European cause. (© Independent News Service)

Irish Independent

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