The Great Debate UK

German elections bring forward a possible stalemate situation for EMU

-Jane Foley is research director at The opinions expressed are her own.-

Next month’s UK general election is not the only one of significance in Europe. There is the possibility that the German regional elections in North Rhine-Westphalia on May 9 could result in the end of the CDU/FDP government’s majority in the upper house of parliament.

While this would not alter Angela Merkel’s status as Chancellor, lessened support would make it more difficult for her to implement planned tax cuts and health services reforms. Fear that she may lose support in NRW is currently delaying the transfer of a German loan to Greece. In turn this means the markets are bracing themselves for a possible default in Greece; an event which could change the present composition of the Economic and Monetary Union of the European Union.

German popular opinion is firmly set against the notion of providing loans to Greece; although Germany as the largest EU economy is obliged to lend around 8.4 billion euros to Greece very soon to help the latter avoid default. While the election in NRW will not be fought on the subject of Greece it does give an added edge to concerns about lack of fiscal manoeuvrability in the region.

Subject of Europe set to trip Liberal Democrat Nick Clegg


Jane Foley- Jane Foley is research director at The opinions expressed are her own. -

Over the past week the British electorate has taken a shine to Liberal Democrat leader Nick Clegg.

Greece and the mythology of the EU


Laurence_Copeland- Laurence Copeland is a professor of finance at Cardiff University Business School and a co-author of “Verdict on the Crash” published by the Institute of Economic Affairs. The opinions expressed are his own. -

The (probably temporary) resolution of the Greek crisis seems to have produced a result which was unexpected – by me, at least. For the first time in the history of the EU, the German taxpayer has refused to be sacrificed on the altar of European solidarity.

Too soon to predict that EMU will wobble


foley-Jane Foley is research director at The opinions expressed are her own.-

The budget crisis facing the Greek government has drawn an array of comments and responses from various parts of the European Central Bank, the European Commission, the International Monetary Fund and the financial markets.