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EU in "most dangerous" crisis ever, incoming Polish presidency says

Other News Materials 5 July 2011 00:07 (UTC +04:00)
The eurozone debt crisis represents the "most dangerous" crisis ever in the European Union's history, a representative of the bloc's Polish presidency said on Monday
EU in "most dangerous" crisis ever, incoming Polish presidency says

The eurozone debt crisis represents the "most dangerous" crisis ever in the European Union's history, a representative of the bloc's Polish presidency said on Monday, dpa reported.

Over the past 14 months, the EU has been forced to bailout three eurozone members - Greece, Ireland and Portugal - and is now grappling with a second bailout package for Athens.

"I think it's very clear to everybody that we are living through interesting and therefore dangerous times, probably some of the most dangerous times that as a European Union we have lived through since 1958," Polish Finance Minister Jacek Rostowski said.

"Should this crisis get out of hand, we shall have not only a eurozone crisis, but also an EU-wide crisis, and not only an EU-wide crisis but maybe a crisis affecting the whole world economy," Rostowski told a European Parliament committee in Strasbourg, France.

Lawmakers are locked in battle with EU governments over a reform of budget discipline rules, with deputies calling for "semi-automatic" sanctions on countries running excessive deficits, while governments want more political control over the procedure.

Rostowski quoted Tolstoi's maxim that "happy families are all alike; every unhappy family is unhappy in its own way" to defend the idea that "discretion" was needed to steer economic policy during crises.

"Each bad time is different," he insisted.

Rostowski said approving the "economic governance" reforms was "vital" to prevent future eurozone crises "for a long time," but stressed that it was "slightly naive" to imagine that a definitive package could ever be worked out.

"We are always going to have crises ... We cannot kid ourselves that we will create a system of regulation that will be 100-per-cent" safe, Rostowski said.

Poland, which on July 1 inherited the EU's rotating presidency from Hungary, is expected to try and broker a deal with parliament during its six-month mandate.

"A final compromise will have to happen, we hope, before September," he told deputies, quipping about the "many a delightful hour" that EU finance ministers have already spent discussing deadlocked issues.

Rostowski also expressed scepticism over a European financial transaction tax - which the European Commission, with parliament's backing, wants to introduce to finance the EU's budget over 2014-2020.

"If we had to have an effective financial transaction tax, it would have to be worldwide," the minister said.

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