News / Europe

EU Divided on New Deal to Save Eurozone

Slovenia's Prime Minister Barut Pahor (L), Germany's Chancellor Angela Merkel (C) and Finland's Prime Minister Jyrki Katainen attend a European Union summit in Brussels December 9, 2011.
Slovenia's Prime Minister Barut Pahor (L), Germany's Chancellor Angela Merkel (C) and Finland's Prime Minister Jyrki Katainen attend a European Union summit in Brussels December 9, 2011.
Lisa Bryant

Stock markets and the value the euro currency rose after most members of the European Union agreed to a new deal Friday, increasing their economic ties to save the struggling eurozone. But reaction is mixed about the agreement, cobbled together after marathon talks among European leaders in Brussels.

European Central Bank chief Mario Draghi reacted positively to the agreement for stronger fiscal ties and better control over government budgets.

"It's a very good outcome for the euro area, very good. It's quite close to a good fiscal compact, and certainly it's going to be the basis for a much more disciplined economic policy for euro-area members, and certainly it's going to be helpful in the present situation," Draghi said.

Graphic map of countries that use the Euro

Twenty-three of the EU's 27 members have agreed to the pact, championed by economic heavyweights France and Germany to make sure Europe's sovereign debt and banking crisis doesn't happen again.  That includes all 17 members of the embattled eurozone. But at a final press conference on Friday, European Union president Herman von Rumpoy said three more countries are considering joining - which would leave Britain as the single holdout.

"Our preference went to a full-fledged treaty change with the 27, changing the treaties of the Eurpean Union. We tried it, but because there was not a unanimous decision, we have to take another decision," he said.

German Chancellor Angela Merkel hailed the deal as a success.  She said those who opted to create a new fiscal union chose a future of more solidarity and economic coherence which will make the euro currency more secure.

EU members adhering to the new treaty must commit to keeping their deficits below 0.5 percent of their economic output - or risk sanctions.  The pact is expected to be signed by March. European leaders also agreed on other measures to stop the eurozone crisis from spreading - like giving the International Monetary Fund another $260 billion to bolster financial firewalls.

But Simon Tilford, chief economist of the London-based Center for European Reform, says the new treaty does nothing to resolve to resolve Europe's debt crisis.

"The problem is that fiscal austerity will not solve this crisis - at least not alone," Tilford said. "Fiscal austerity has in many ways been part of the crisis. Enforcing unending austerity on the countries in the periphery has already made their predicaments much worse and threatens to make a bad situation in Spain and Italy already worse than it currently is."

Other analysts fear the deal weakens European unity - with one group of countries part of the new pact and another out of it.  British Prime Minister David Cameron defended his decision to reject the treaty - and offered another vision of Europe.

"We're not in the euro, and I'm glad we're not in the euro," Cameron said. "So i think the idea of Europe being more of a network - you choose those organizations you join, you choose those organizations you don't join - is actually a way in which Britain can get what we want and what we need in Europe."

Analyst Tilford says whether Britain and others will be weaker for opting out of the fiscal pact depends on what happens to the eurozone.

"If the eurozone does master this crisis and holds together, we're likely to see increased integration within participating countries within the eurozone, and Britain will become progressively marginalized within the EU," Tilford said.

But if the eurozone crisis drags on and the euro area fractures, he says, that's another story. And Tilford sees nothing in the new pact EU leaders agreed on that makes him optimistic about the euro's future.

You May Like

US Border Patrol Union Accused of Taking Sides on Immigration

Report alleges agents leaking info to immigration opponents, appearing at their private events; Center for Immigration Studies director defends agents' actions More

Video Blind Somali Journalist Defies Odds in Mogadishu

Reporting from Somali capital for past decade, Abdifatah Hassan Kalgacal has been working at one of Mogadishu's leading radio stations covering parliament More

Video Rights Monitor: Hate Groups' Use of Internet to Inflame, Recruit Growing

Wiesenthal Center's Abraham Cooper says extremists have become skilled at celebrating violence, ideology on Web More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Hate Groups Spread Influence Via Interneti
X
Mike O'Sullivan
June 30, 2015 8:20 PM
Hate groups of various kinds are using the Internet for propaganda and recruitment, and a Jewish human rights organization that monitors these groups, the Simon Wiesenthal Center, says their influence is growing. The messages are different, but the calls to hatred or violence are similar. VOA's Mike O’Sullivan reports.
Video

Video Hate Groups Spread Influence Via Internet

Hate groups of various kinds are using the Internet for propaganda and recruitment, and a Jewish human rights organization that monitors these groups, the Simon Wiesenthal Center, says their influence is growing. The messages are different, but the calls to hatred or violence are similar. VOA's Mike O’Sullivan reports.
Video

Video US Silica Sand Mining Surge Worries Illinois Residents, Businesses

Increased domestic U.S. oil and gas production, thanks to advances known as “fracking,” has created a boom for other industries supporting that extraction. Demand for silica sand, used in fracking, could triple over the next five years. In the Midwest state of Illinois, people living near the mines are worried about how increased silica sand mining will affect their businesses and their health. VOA’s Kane Farabaugh has more in this first of a series of reports.
Video

Video Blind Somali Journalist Defies Odds in Mogadishu

Despite improving security in the last few years, Somalia remains one of the most dangerous countries to be a journalist – even more so for someone who cannot see. Abdulaziz Billow has the story of journalist Abdifatah Hassan Kalgacal, who has been reporting from the Somali capital for the last decade despite being blind.
Video

Video Texas Defies Same-Sex Marriage Ruling

Texas state officials have criticized the US Supreme Court decision giving same-sex couples the right to marry nationwide. The attorney general of Texas says last week's decision did not overrule constitutional "rights of religious liberty," and therefore officials performing wedding services can refuse to perform them for same-sex couples if it is against their religious beliefs. Zlatica Hoke reports on the controversy.
Video

Video Syrians Flee IS Advance in Hasaka

The Syrian government said Monday it has taken back one of several districts in Hasaka overrun by Islamic State militants. But continued fighting elsewhere in the northern city has forced thousands of civilians from their homes. In this report narrated by Bill Rodgers, VOA Kurdish Service reporter Zana Omer describes the scene in Amouda, where some of the displaced are taking refuge.
Video

Video Rabbi Hits Road to Heal Jewish-Muslim Relations in France

France is on high alert after last week's terrorist attack near the city Lyon, just six months after deadly Paris shootings. The attack have added new tensions to relations between French Jews and Muslims. France’s Jewish and Muslim communities also share a common heritage, though, and as far as one French rabbi is concerned, they are destined to be friends. From the Paris suburb of La Courneuve, Lisa Bryant reports about Rabbi Michel Serfaty and his friendship bus.
Video

Video S. Korea Christians Protest Gay Rights Festival

The U.S. Supreme Court decision mandating marriage equality nationwide has energized gay rights supporters around the world. Gay rights remain a highly contentious issue in a key U.S. ally, South Korea, where police did a deft job Sunday of preventing potential clashes between Christian protesters and gay activists. Kurt Achin reports from Seoul.
Video

Video Saudi Leaks Expose ‘Checkbook Diplomacy’ In Battle With Iran

Saudi Arabia’s willingness to wield its oil money on the global diplomatic stage appears to have been laid bare, after the website WikiLeaks published tens of thousands of leaked cables from Riyadh’s Ministry of Foreign Affairs. VOA's Henry Ridgwell reports.
Video

Video Nubians in Kenya Face Land Challenges

East Africa's ethnic Nubians have a rich cultural history that dates back thousands of years, but in Kenya they are facing hardships, including the loss of lands they have lived on for generations. They say the government has reneged on its pledge to award them title deeds for the plots. VOA's Lenny Ruvaga reports.
Video

Video Military Experts Question New Russian Tank Capabilities

Russia has been showing off its new tank design – the Armata T-14. Designers claim it is 20 years ahead of current Western designs - and driving it feels like playing a computer game. But military analysts question those assertions, and warn the cost could be too heavy a burden for Russia’s struggling economy. Henry Ridgwell reports.
Video

Video In Kenya, Police Said to Shoot First, Ask Questions Later

An organization that documents torture and extrajudicial killings says Kenyan police were responsible for 1,252 shooting deaths in five cities, including Nairobi, between 2009 and 2014, representing 67 percent of all gun deaths in the areas reviewed. Gabe Joselow has more from Nairobi.
Video

Video In Syrian Crisis, Social Media Offer Small Comforts

Za’atari, a makeshift city in Jordan, may be the only Syrian refugee camp to tweet its activities, in an effort to keep donors motivated as the war in Syria intensifies and the humanitarian crisis deepens. Inside the camp, families say mobile phone applications help hold together families that are physically torn apart. VOA’s Heather Murdock reports.

VOA Blogs