The crisis in Greece will have awful consequences on the entire Balkan region, especially for Romania and Bulgaria. What is happening in Greece could affect the emerging and already instable economies from South - Eastern Europe by creating new impediments in the economic stabilization.
For almost two decades Greece has been one of the major investor in South-Eastern Europe The Greek banking system has all its major operations taking place in Romania and Bulgaria. In Bulgaria, almost one third of the banking system is hold by different Greek banks. As for Romania they hold almost 12% of the banking system.
Experts from the European Bank (ERDB) draw the attention to the economic community of the possible negative impact of the Greek economic breakdown over the banking system and the economies from the entire region. They also said - in regards to the neighborhood countries - that being close to a state that’s going through such a major crisis could be a troublesome factor for the possible investors.
The European Commissioner Mr. Olli Rehn, said that the future of the European Union depends on whether Greece is rescued or not. He said that if Greece collapses and the EU doesn’t prevent this thing from happening, all its credibility will be lost on a long term.
This crisis brought the European Union face to face with a turning point for it as a union of states. From here onwards we’ll see if the member states are able or not to act more solitary, politically speaking.
What could all the states do in the meantime? They can try to coordinate better their economic policies in order to reduce the aggravating unbalances between them.
Another idea has been circulating these days and that is the creation of the European Monetary Fund. It will have as major task to prevent things like the situation in Greece from happening again in one of the member states.
The German Finance Minister Wolfgang Schaeuble said that that setting up the fund would involve rewriting the rules for membership in the euro zone, which currently counts 16 members, and that would take time. But he underlined that such a step was necessary.
"We need the EWF because we need tougher rules," Schaeuble said, noting that at the time of the drawing-up of the euro stability package, which outlines the terms for membership, "we did not take into consideration that a euro zone member could go bankrupt."
The German Chancellor Angela Merkel said: "We want to be able to resolve our problems in the future without the IMF". The living example o why she said so is the Greece attitude towards the whole issue. The Greeks put pressure on its EU colleagues, occasionally flirting with the IMF.
Even though this idea already gained the support from Paris and Brussels, the European Central Bank holds some objections. It considers that the birth of the European Monetary Fund could damage the euros reputation and it will show the weakness of the euro area.
Now, naturally, there are certain issues and questions arising from this idea of a European Monetary Fund. If it will be approved and if it will act as a support for those countries from the European Union that are already using the Euro as national currency, then what about the rest of the EU countries? What about the United Kingdom?
It will obviously appear a two time Europe: the first one of those countries that are in the euro area and the second one made of the rest of the countries that still holds their national currency. Could this be seen as discrimination? To their surprise some countries might see things this way. Why? For there’ll be the question: and what about those countries that aren’t yet in the euro area? In case they’ll face a crisis, who will help them?
There will be those who will suggest that the fund is supported by not just the 16 euro area members but by all 27 countries in the European Union. "That idea simply won't fly in the UK," said one British official. However the fund is dressed up it will be regarded as a bail-out body for the euro and British taxpayers are most unlikely to want to make any contribution towards rescuing a currency they have little enthusiasm for joining.
That is not the case in Romania since they’d like to adhere to the euro area. However the adherence criteria are going to be extremely harsh and severe, in order to ensure that the new euro area member states won’t re-create a new Greek crisis.
As it was expected, the creation of the EMF implies changes in the Lisbon Treaty for without these changes the founds for the fund will simply be inexistent. But in order to make any changes, there’ll have to be another round of treaty changes and that will need the consent of all 27 member states.
Whatever the decisions will be regarding the EMF, this plan will come up too late for solving the Greek problems. But instead, the EMF might turn in a real milestone for the European Union as a whole.
Why? Few years ago, before the last enlargement, there was a discussion regarding a possible division of the European Union in the new format of 27 member states. The rumor was that it will end up being a Union of two Europe: the first one made up of the old member states with a normal economic growth. The second one will be composed of the new 12 member states with a slower rhythm of development, but that will try to keep up with the first one.
Now as I’ve said before, there’ll be segregation within the member states, but instead of the old versus new member states we will have the euro area and non euro area states.
As a conclusion, this whole situation could very well be the point where the European Union will become stronger and unified as a real union of states with its own solutions and means of resolution for any kind of conflict. Or –and now comes the fatalist vision, one that is not desired by anyone- the EMF will have the opposite effect: the beginning of the end for the European Union. In the end Greece will play the major part in this whole situation. Will Greece prove out to be the modern Trojan horse for the European Union?
by Ana Dorobantu
