Daily Management Review

Germany and France set up to stabilize the eurozone


Berlin and Paris are stepping up efforts to strengthen the euro area. The countries are setting up a joint working group, which should submit concrete proposals by July.

World Economic Forum via flickr
World Economic Forum via flickr
Germany and France intend to accelerate adoption of decisions aimed at strengthening the Pan-European monetary union. By the time of the joint meeting of the councils of ministers of both countries in July, the ad hoc working group should submit concrete proposals on stabilizing the Eurozone. Finance ministers of Germany and France, Wolfgang Schäuble and Bruno Le Maire, announced this at the end of the meeting in Berlin on Monday, May 22.

Paris and Berlin are in favor of giving the euro area integration "a new dynamic," the French minister said, adding that there is a lot of work to be done in this area, and it should be done together.

Schäuble told about ambitious intentions. According to him, we are talking about introduction of a general tax law of enterprises or the general basis for calculating corporate tax.

The EU Commissioner for Economic and Financial Affairs, Pierre Moscovici, welcomed the German-French initiative. The cooperation of the two largest economies of the European Union is very important, but other countries of the single currency zone should also be involved, he said.

Germany, Great Britain and France were the EU’s main backbone. Brexit has significantly weakened the EU, both economically and ideologically. Germany and, in particular, Angela Merkel were afraid of two factors: victory of Marin Le Pen in the elections in France and the Brexit trend taking over other EU countries.

The "National Front" chairman has repeatedly expressed her opinion about the European cooperation, which has exhausted itself and "violates the sovereignty of France". It is possible that one of the solutions to the problem for France would be to leave the union - a blow, which the EU would not stand. Economic and migration issues completely beset Germany, and Berlin would not have coped on its own. But this point did not materialize, and, thus, Merkel hospitably met Macron in the FRG.

The withdrawal of France could have been a continuation of Britain’s decisive step, which in the future would lead to separation of Eastern European countries and final split in the EU. Eastern Europe has long been tossing European values, which have become a burden, on the second and third plane, pushing forward the national interest of its state. 

Unequivocally, the coming to power of Macron will improve the after-Brexit imbalance. Macron’s first visit abroad apparently was not surprising. Of course, it is impossible to settle the EU crisis for one meeting. However, the essence of the visit of the new owner of the Elysee Palace was symbolic - to demonstrate clearly that France does not plan a referendum on leaving the organization.

Germany has been backed up by France, and the next step towards the European community will be reformation. Reforms aimed at strengthening the EU, as well as cooperation with the UK - so that the lack of such a weighty brick in the foundation of Europe became less noticeable and painless.

source: dw.de