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

Video Five Patients Given Experimental Ebola Drug Said To Be Improving

Experimental drugs have been tried on six people: three Westerners and now, three African pyhysicians More

Video In Ukraine, Fear and Distrust Remain Where Fighting has Stopped

As Ukrainian military reclaims control of eastern cities residents rebuild their lives, but many say everyone is being treated with suspicion More

Video In Rural Kenya, Pressure Builds Against Female Circumcision

Girls learn to object; FGM practitioners face penalties from jail sentences to stiff fines 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.
Five Patients Given Experimental Ebola Drug Said to Be Improvingi
X
Carol Pearson
August 19, 2014 11:43 PM
The World Health Organization has approved the use of experimental treatments for Ebola patients in West Africa. The Ebola outbreak there is unprecedented, the disease deadly. The number of people who have died from Ebola has surpassed 1,200. VOA's Carol Pearson reports on the ethical considerations of allowing experimental drugs to be used.
Video

Video Five Patients Given Experimental Ebola Drug Said to Be Improving

The World Health Organization has approved the use of experimental treatments for Ebola patients in West Africa. The Ebola outbreak there is unprecedented, the disease deadly. The number of people who have died from Ebola has surpassed 1,200. VOA's Carol Pearson reports on the ethical considerations of allowing experimental drugs to be used.
Video

Video In Ukraine, Fear and Distrust Remain Where Fighting has Stopped

As the Ukrainian military reclaims control of eastern cities from pro-Russian separatists, residents are getting a chance to rebuild their lives. VOA's Gabe Joselow reports from the town of Kramatorsk in Donetsk province, where a sense of fear is still in the air, and distrust of the government in Kyiv still runs deep.
Video

Video China Targets Overseas Assets of Corrupt Officials

As China presses forward with its anti-graft effort, authorities are targeting corrupt officials who have sent family members and assets overseas. The efforts have stirred up a debate at home on exactly how many officials take that route and how likely it is they will be caught. Rebecca Valli has this report.
Video

Video Leading The Fight Against Islamic State, Kurds Question Iraqi Future

Western countries including the United States have begun arming the Kurdish Peshmerga forces in northern Iraq to aid their battle against extremist Sunni militants from the Islamic State. But there are concerns that a heavily-armed Kurdistan Regional Government, or KRG, might seek to declare independence and cause the break-up of the Iraqi state. As Henry Ridgwell reports from London, the KRG says it will only seek greater autonomy from Baghdad.
Video

Video In Rural Kenya, Pressure Builds Against Female Circumcision

In some Kenyan communities, female genital mutilation remains a rite of passage. But activists are pushing back, with education for girls and with threats of punishment those who perform the circumcision. Mohammed Yusuf looks at the practice in the rural eastern community of Tharaka-Nithi.
Video

Video For Obama, Racial Violence is Personal Issue

The racial violence in the St. Louis suburb of Ferguson is presenting U.S. President Barack Obama with an issue to which he has a deep personal connection. To many Americans, Obama's election as America's first black president marked a turning point in race relations in the United States, and Obama has made ending the violence a policy priority. On Monday he issued a new call for calm and understanding. Luis Ramirez reports from the White House.
Video

Video Clinton-Obama Relationship Could Impact 2016 Election

President Barack Obama and former Secretary of State Hillary Clinton have a long and complicated relationship. That relationship took another turn recently when Clinton criticized the president’s foreign policy. VOA National Correspondent Jim Malone reports there is renewed attention on the Clinton-Obama relationship as Hillary Clinton considers running for
Video

Video Iran Looks to Maintain Influence in Baghdad With New Shia PM

Washington and Tehran share the goal of stopping Syrian-based militants in Iraq. But experts say it's Iran, not the United States, that will most influence how the new government in Baghdad approaches internal reforms and the war in Syria. VOA State Department Correspondent Scott Stearns has the story.

AppleAndroid