News / Europe

European Leaders Pressed to Deliver at Crisis Summit

European leaders are gathering in Brussels for a critical end-of-year summit, another attempt to resolve a sovereign debt and banking crisis threatening the very future of the euro currency union.  Pressure is on for them to come out with a definitive deal this time around, after what critics claim are months of half-measures.

This is not the first time a European Union summit has been described as the last chance to save the struggling euro currency union.  But the 27 EU leaders gathering Thursday and Friday in Brussels face extraordinary pressure, at home and abroad,to deliver a lasting solution to the two-year-old eurozone crisis.

The plan on the table is authored by Europe's two biggest economies, France and Germany.  They want to overhaul EU treaties to forge a more binding and fiscally responsible eurozone. The two leaders outlined the details of their vision on Wednesday, in a letter to EU President Herman van Rompuy.

Watch related report by Al Pessin:

At a joint press conference with his German counterpart Angela Merkel earlier this week, French President Nicolas Sarkozy said the crisis has given the two countries an extra reason for unity.  He said both countries envision the same kind of Europe.

But their plan must still be accepted by the other 25 EU members or at very least, the 17 members of the eurozone.  And that, says analyst Philippe Moreau Defarges, of the French Institute of International Relations, is not at all certain.

"There will be a very strong pressure to accept this deal.  Not only from the eurozone members, but also outside the eurozone," he said. "I think the British should back this agreement.  But it will be difficult. "

British Prime Minister David Cameron, whose country is not part of the euro currency union, has already expressed reservations.  He told British TV his first priority at the summit will be to defend British interests.

"Eurozone countries do need to come together, do need to do more things together.  If they choose to use the European treaty to do that, Britain will be insisting on some safeguards too.  And as long as we get those, then that treaty can go ahead," said Cameron. "If we cannot get those, it will not."

BNP Parisbas bank economist Shahin Vallee, a visiting fellow at Brussels economic think-tank Bruegel, does not think any deal reached will be enough.

"I think not, unfortunately.  I think this proposal rests on the idea that with stronger fiscal rules and more automaticity of those rules the euro area will be stronger and financial markets will be comforted and have more belief in the long term sustainability of the euro area, and I think this is an illusion," said Vallee.

French analyst Moreau Defarges also has his doubts about the French-German plan.

"It is a very partial, a very institutional, a very budgetary and fiscal answer to the euro crisis.  The euro crisis is a growth crisis, a problem of growth," said Defarges. "Will the European Union find a new path toward growth?  That is the key question."

Even if the other EU countries accept the French-German plan, it will take months, if not years, to fully implement it, because it may require amending EU treaties.  Analysts like Vallee say Europe's crisis needs immediate action.

"I think the right solution  would be to have a more ambitious treaty change, take the necessary time to negotiate the provisions of this new treaty, while at the same time doing something that is immediately operational to respond to the crisis and the urgency of the crisis," noted Vallee.

Adding to the pressure, ratings agency Standard & Poor's has threatened to downgrade the credit rating of 15 eurozone members, including heavyweights France and Germany.  There are fears the crisis could spread overseas, slowing growth in Africa and Asia and threatening America's fragile recovery.

U.S. Treasury Secretary Timothy Geithner has been meeting with top officials and heads of state in Europe this week, underscoring Washington's concern.

"I am here in Europe, of course, to emphasize how important it is to the United States, and to the world economy as a whole, that Germany and France succeed alongside the other nations of Europe in building a stronger Europe," said Geithner.

The eurozone crisis has rekindled longstanding debates on whether the European Union should head toward more unity, economically and politically or does the crisis underscore the failure of European integration?  Vallee believes resolving these and other EU visions is also critical to resolving the eurozone crisis.

You May Like

US Investors Eye IPO for China's Alibaba

E-commerce giant handled 80 percent of China's online business last year, logging more Internet transactions than US-based Amazon.com and eBay combined More

Video Uneasy Calm Settles Over Israel, Gaza Strip

As cease-fire begins, Palestinians celebrate in streets; Israelis remain wary More

Video Chinese Doctors Use 3-D Spinal Implant

In treatment of a 12-year-old boy Chinese doctors used a 3-D printer and special software to create an exact replica of vertebra 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.
Chinese Doctors Use 3-D Spinal Implanti
X
August 27, 2014 4:53 PM
A Chinese boy suffering from a debilitating bone disease has become the first patient with a part of his spine created in a three-dimensional printer. Doctors say he will soon regain normal mobility. VOA’s George Putic reports.
Video

Video Chinese Doctors Use 3-D Spinal Implant

A Chinese boy suffering from a debilitating bone disease has become the first patient with a part of his spine created in a three-dimensional printer. Doctors say he will soon regain normal mobility. VOA’s George Putic reports.
Video

Video Uneasy Calm Settles Over Israel, Gaza Strip

Israel and the Gaza Strip have been calm since a cease-fire set in Tuesday evening, ending seven weeks of hostilities. Hamas, which controls Gaza, declared victory. Israelis were more wart. VOA’s Scott Bobb reports from Jerusalem.
Video

Video India’s Leprosy Battle Stymied by Continuing Stigma

Medical advancements in the treatment of leprosy have greatly diminished its impact around the world, largely eliminating the disease from most countries. India made great strides in combating leprosy, but still accounts for a majority of the world’s new cases each year, and the number of newly infected Indians is rising - more than 130,000 recorded last year. Doctors there say the problem has more to do with society than science. VOA News reports from Kolkata.
Video

Video Northern California Quake: No Way to Know When Next One Will Hit

A magnitude 6.0 earthquake rocked northern California’s Napa Valley on Sunday. Roads twisted and water mains burst. It was the wine country’s most severe quake in 15 years, and while hospitals treated many people, no one was killed. Arash Arabasadi has more from Washington on what the future may hold for those residents living on a fault line.
Video

Video Scientists Unlock Mystery of Bird Flocks

How can flocks of birds, schools of fish or herds of antelope suddenly change direction -- all the individuals adjusting their movement in concert, at seemingly the same time? British researchers now have some insights into this behavior, which has puzzled scientists for a long time. VOA's George Putic has more.
Video

Video Ukraine: Captured Troops Proof of Russian Role in Separatist Fight

Ukrainian officials say they have captured Russian soldiers on Ukrainian territory -- the latest accusation of Moscow's involvement in the conflict in eastern Ukraine. VOA's Gabe Joselow reports from the Ukrainian side of the battle, where soldiers are convinced of Russia's role.
Video

Video Rubber May Soon Come From Dandelions

Synthetic rubber has been around for more than a century, but quality tires for cars, trucks and aircraft still need up to 40 percent or more natural rubber content. As the source of natural rubber, the rubber tree, is prone to disease and can be affected by bad weather. So scientists are looking for replacements. And as VOA’s George Putic reports, they may have found one in a ubiquitous weed.
Video

Video Jewish Life in Argentina Reflected in Yiddish Tango

Jewish people from across Europe and Russia have been immigrating to Argentina for hundreds of years. They brought with them dance music that were eventually mixed with Argentine tango. The result is Yiddish tango -- a fusion of melodies and cultural experiences that is still evolving today. Elizabeth Lee reports from the Skirball Cultural Center in Los Angeles, where one band is bringing Yiddish tango to an American audience.

AppleAndroid