Saturday 18 January 2020

Ailish O'Hora: Another summit? The reality is that all this talk of a federal Europe is grossly premature and aspirational.

Welcome to Brussels. The centre of the world, at least for the next two days.

As the great and good of Europe bed down for two days of talks on ways the save the eurozone, and indeed the global economy from the debt crisis, cracks have already begun to appear.

British leader David Cameron is facing one his biggest tests in his short time at the helm of our nearest neighbour and will come under increased pressure to cow-tow to what has now been accepted as the Franco-German approach to the future of this now shaky continent.

We, on the other hand, are firmly focused on our low 12.5pc corporation tax and avoiding a referendum on treaty changes which the new Fine Gael government knows well have never held well with the Irish electorate.

Back in Belgium, Brussels is in lock-down ahead of this key summit with security as tight here as I've ever seen it.

There's even barbed-wire cordoned off certain streets around the European Council building - no tanks and guns thankfully.

This war is being fought with different weapons.

Cash-hungry investors have replaced the more traditional fighting tools and are picking off the fragile sovereign bonds of countries like Spain and Italy - remember Ireland, Portugal and Greece have already been priced out of borrowing on the open markets and are now reliant on EU/ECB/IMF bailout loans,

There is a great air of expectation in the city that a grand decision will be made that will be key to the safety of the euro which many believe now was a well-intentioned but badly planned currency created by those who still remembered the damage done to the people of Europe during and after the second world war.

But we've had European summits before, seven so far this year, and they have not been convincing enough to keep the markets at bay.

There's talk of billion-euro bailout funds - a so-called big bazooka or as only our Finance Minister Michael Noonan could get away with calling it "a big wall of money" and the European Central Bank boosting the bonds of already damaged countries but there's an underlying problem.

While the focus in now firmly on the eurozone-17 members states, there are 10 others and many of them are relative newcomers to what we now call democracy.

That's, of course, if you take Greece and Italy out of the equation after frankly being bullied into forming technocratic government by what's now commonly known as Merkozy- remember both leaders are also fighting for their political lives in their respective countries with elections imminent.

The current focus is on staving off the markets and short-term answers to very complicated problems.

But there are a whole range of issues and complexities that have yet to focus the minds of European leaders if a true Europe is to be created.

On a recent trip to Romania, which joined the EU in 2007 and is planning to join the eurozone by 2015, these differences were clear as day.

The average monthly salary there is €300 to €400 and the country's unemployment levels make our 14pc-odd rate look attractive.

The crippline International Monetary Fund reform programme in place there also makes our recession seem like business as usual.

So much so, many people, and not just the elderly, are hankering for the days of the Ceausescu regime where, at least, on paper and propped up by a false communist system, people had enough money to live. Only, of course, where food was available to buy.

I spoke to Alex, an engineer-turned interpreter because she could not find work in here area of expertise, and did alot of her translation on the black market to avoid crippling tax rates.

While a positive person in general, she was absolutely negative about the future of Romania under the current regime - the nomenklatura or former communists who held mid-range roles during the Ceauscescu regime but were low level enough to fall under the radar when the system collapsed after the revolution of 1989.

Romania first supported Germany during World War II switching to Russia later in a position that still raises the eyebrows of many of its closer neighbours.

As a result, many of Bucharest's beautiful pre-war buildings are still intact but decrepit and there are no funds to renovate them.

Not to say the country didn't suffer, in less than a year of the war starting the country had lost 100,000 square kilometres and six million of the population and all essentially without a shot being fired.

The place reminded me of Warsaw, Poland of the mid-1990s when I worked there as a business journalist (although that city's buildings were not spared during the last world war and the country's population also suffered deeply.

A place of much despair, distrust and a palpable lack of hope - although Warsaw is much-changed now and the country's 4pc quarterly growth rate, which can in part be put down to the country not joining the euro, is the envy of many other countries.

Sadly, for Romanians, no one seems to be able to see that the country's beautiful countryside could make it a tourist-haven and maybe it will enjoy better times once this is tackled.

What's clear is that there is no way it will be ready to join the eurozone in 2015 and the problems are not just economic with many deeply disturbing throwbacks to these countries troubled pasts.

Many Romanians, and other inhabitants of former communist countries, believe that while they had enough to live on, other freedoms were firmly lacking.

Ironically, while Romanians, like many of their neighbours, could not travel abroad during the communist regime, they can now but don't have the money to do so.

All this historic homogeneity has also bred another nasty problem - racism.

Romanians joke openly that their best export are the often downtrodden Roma gypsies but it goes even deeper.

I asked Alex about problems with the mafia. While this problem is dying down in some parts of central and Eastern Europe it is still a massive issue in Romania..

I assumed she would elaborate on local gangs, which are rampant in most cities, but she highlighted the Chinese. In just under a week in Romania I didn't see one Chinese person.

But Romania is not alone in that part of the world and resentments are still rife in other more developed former communist countries like Poland where anti-semitism is, for some, a way of life.

The growth of neo-Nazism has reared also reared its ugly head in many so-called, more developed European countries, including Germany recently.

As the big guns put their heads together in Brussels over the next couple of days, the focus will mainly be financial.

But the reality is, all this talk of a federal Europe is grossly premature and aspirational.

As a committed Europhile, I would like nothing better than a united continent but while we can live in hope, it is not going to happen anytime soon.

The divisions are just too complicated - even when you keep the thorny issue of Russia out of the equation.

At home, the focus is now on whether decisions can be made on the future of Europe without a referendum and keeping our corporation tax intact.

In Brussels, it's about keeping the markets at bay with tools like that "wall of money" and Germany getting its way on keeping European countries budget deficits under contol.

These are deeply important issue for the future of both the European and Irish economies but we are light years away from a united Europe

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