Christian Odendahl (4)

  • Three ways COVID-19 will cause economic divergence in Europe

    Three ways COVID-19 will cause economic divergence in Europe

    By agreeing a proposal for a €500bn EU recovery fund with Emmanuel Macron on May 18th, Angela Merkel broke two rules of Germany’s EU policy: that there should be no common borrowing and no transfer union beyond the existing EU budget. The Franco-German proposal could be a historic step towards more fiscal integration in the EU, but the Northern European ‘frugals’, led by the Netherlands, will have to be persuaded not to whittle down the size of the transfers.

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  • The low-hanging fruit of European capital markets

    The low-hanging fruit of European capital markets

    Europe's economy is too dependent on bank finance. A greater reliance on capital markets would help to boost the region's economic growth and resilience in future financial crises. To this end, the Commission is aiming to create a capital markets union in an effort to lower Europe's dependence on bank finance and encourage the integration and deepening of its capital markets.

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  • Greece will remain in the euro, for now

    Greece will remain in the euro, for now

    Greece will hold a snap election on 25 January, after the country's parliament failed to elect a new president with the necessary majority. Syriza, a left-wing party led by Alexis Tsipras, currently leads the polls. Given Syriza's outspoken criticism of Greek economic and social policies over the last four years, and its confrontational statements vis-a-vis the Eurozone, some fear that Greece might quit the single currency. This prompts several questions: is it in Greece's interest to leave? What would be the consequences for the Greek economy and that of the Eurozone? And is the rest of the Eurozone willing to let Greece go? Are there any benefits of Grexit for Greece? Greece would regain autonomy over its monetary policy – the most effective tool for maintaining demand in an economy. An independent Greek central bank, if it were able to control inflation, could raise those expectations, leading consumers and investors to spend and invest. The Bank of Greece would also be in a position to ensure that real interest rates were low enough to stimulate investment.

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  • Euro is too strong for the Eurozone

    Euro is too strong for the Eurozone

    The val­ue of the euro is a top­ic of con­stant debate in Euro­pe­an pol­i­cy cir­cles. The debate fol­lows a reg­u­lar pat­tern: French or Ital­ian pol­i­cy-mak­ers bemoan the strength of the euro because it hurts their exports; Ger­man pol­i­cy-mak­ers rebuff such claims; the Euro­pe­an Cen­tral Bank (ECB) claims it is not aim­ing for a par­tic­u­lar val­ue of the euro as its man­date is focused on price sta­bil­i­ty only; and inter­na­tion­al com­men­ta­tors point out that the Euro­zone is sim­ply too large to pur­sue a pure­ly export-ori­ent­ed strat­e­gy any­way.

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