Daily Management Review

King: Germany Should Leave Eurozone


Germany had become too powerful and must leave the euro zone in order to avoid collapse of the monetary union, said the former governor of the Bank of England Mervyn King.

fdecomite via flickr
fdecomite via flickr
"This is the best way to break forward, and I hope that many of my American friends will no longer push the Europeans to the fact that they have invested in this business, as the euro has to become successful," - said King at CNBC.

As he said, the tragedy of the eurozone is that Germany took part in this project in an attempt to integrate into the EU as much as possible, so that no country would no longer be afraid of the power of the state. Now, however, Germany has become a country more powerful economically and politically than it was before the entry into the monetary union.

He also noted that in order to participate in this process, Germany has also donated a German brand, "really successful symbol of postwar German reconstruction."

While the United States, United Kingdom, as well as some European countries have to export and invest more and reduce costs, Germany, and China need to increase spending and reduce exports, King said.

"If we are not willing to solve the problem by restructuring the economy once and for all, you have to follow the path of the lower rates and the lack of economic growth", - said he.

Last week, Head of the ECB Mario Draghi warned European leaders that only one monetary policy is not enough to stimulate the economy: governments need to pursue structural reforms.

"I made it clear that even if monetary policy has been the only way to economic recovery in the past few years, it still will not solve a number of fundamental structural problems of the Eurozone economy," - Draghi said to reporters.

European leaders will discuss further integration of the economy and policies of 19 countries towards the euro at a summit in June.

source: cnbc.com