Greek debt crisis: pushing more European integration?
As the Greek debt crisis rolls on, some in Britain worry that the crisis is being used to undermine economic sovereignty and pushes European integration further.
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On Thursday, the world's largest bond fund, Pimco, said that European efforts to back Greece and its austerity plans, were not enough – a warning that bodes ill for the country's future ability to raise funds at lower interest rates.
The continuing Greek crisis is reviving tensions over economic sovereignty – as well as exposing the difficulty of managing 16 diverse economies that share a single currency, the euro.
Some see the Greek debt crisis as underscoring the need for a unified European economic policy or greater “economic governance” – a vision endorsed this week by the European Commission in the EU’s Brussels executive meeting.
“Throughout the whole Greek crisis you can see that moves have been made towards increased economic governance,” says Sarah Gaskell, an analyst at Open Europe, a London-based think tank critical of European integration.
An even more contentious phrase was initially touted last week by France and Germany for new bloc-wide rules that would create a system of European "economic government" before it was watered down, partly through the efforts of Britain, which remains outside of the euro zone but is still an influential European Union member state.
Ms. Gaskell points out however that “government” has survived in the French translation of last week’s accord, which was largely about creating an IMF-linked safety net for the Greeks but also envisaged new sanctions being brought against other wayward euro zone spenders in future.
“There is obviously disagreement about economic government which Ireland and Sweden and Britain were traditionally wary because it gives suggests greater federalism,” she adds.