A crisis at the gates that should not be underestimated

Jens Bastian*

The political and central bank authorities in Tirana should not underestimate the twin Greek economic and sovereign debt crises. Their potential implications medium-term are considerable. Some spill over effects are already manifesting themselves in Albania. In a word, despite a remarkable economic success story during the past years, Albanian policy makers would make a grave mistake by judging that they are immune to developments in Greece.

Griechische Tragödie – Europäisches Schattenboxen

Nach heftigen öffentlichen Debatten hat das griechische Parlament in der vergangenen Woche der mittelfristigen Finanzplanung und einem umfassenden Privatisierungsprogramm zugestimmt. Daraufhin haben die EU-Finanzminister am Sonntag zugunsten der Auszahlung des EU-Anteils an der fünften Kredittranche an Griechenland entschieden. Schließlich haben Frankreich und Deutschland die Umrisse einer freiwilligen Beteiligung der privaten Banken und Versicherungsgesellschaften an einem zweiten griechischen Rettungspaket ausgehandelt.

So weit, so gut? Keineswegs! Die deutsche Finanzwirtschaft hat lediglich zugesagt, als Eigenbeitrag zum zweiten Paket griechische Anleihen im Wert von 3,2 Mrd. Euro zu refinanzieren sofern diese bis 2014 auslaufen. Davon kommen allerdings 1,2 Mrd. Euro von Kreditinstituten, die im Wesentlichen von staatlicher Alimentierung leben. Zudem kommt die deutsche Beteiligung ein Jahr zu spät.

A make or break moment for Greece

The Greek parliament has approved the new set of austerity measures and the privatization legislation with a robust margin. But unfortunately even this victory is not going to be a breakthrough in this crisis.

Assuring passage of the austerity and privatization legislation in parliament was only the easy part. Given the waves of discontent being expressed by the so-called indignant citizens on Syntagma Square in Athens and trade unions’ militant industrial action, the subsequent implementation process will be severely challenged by different constituencies and thus risks being delayed or sabotaged.

Memorandum to Prime Minister George Papandreou: Towards a reform and growth strategy

During a two-day international conference at SEESOX, St Antony’s College, Oxford, entitled: Whose crisis? Greece’s politics, economic and society in an era of uncertainty (27/28 May 2011) 35 speakers and more than 100 participants engaged in a frank and constructive discussion on the causes, implications and future outcomes of the current crisis. Inspired by some of the ideas in this conference, we have continued the discussion in Oxford and we are ready to engage in a cooperative spirit with your administration during these challenging times, if you so wish.

Our initiative offers a dialogue, contributing in a critical and constructive manner to key issues of your reform and growth agenda. The focus is on five aspects. Let us lay out the case for each one.

The EU needs leadership to tackle this crisis, not repeated doses of austerity

Ad hoc politics has undermined European solidarity and has created confusion and distrust among Europe's citizens

• Jürgen Habermas and 18 others 
• guardian.co.uk, Wednesday 22 June 2011 22.55 BST 

The current eurozone crisis has been an important test for the EU; and it has not done well so far. For too long, Europe's leaders have simply responded to unfolding events rather than directly confronting the root causes of the crisis. This ad hoc politics has undermined European solidarity and has created confusion and distrust among Europe's citizens. We have to change this approach and restore political leadership to prevent further damage.