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Deja-vu? EU braces for another turbulent spring
Market jitters and clashing interests likely to hamper grand deal on eurozone rescue
German Chancellor Angela Merkel attends a joint news conference with the Prime Minister of Luxembourg, Jean-Claude Juncker, after a meeting at the chancellery in Berlin, Germany, Friday, March 4, 2011. (AP Photo/Michael Sohn)
Gabriele Steinhauser, AP Business Writer, On Friday March 11, 2011, 7:24 am EST
BRUSSELS (AP) -- When EU leaders gather here Friday to build the "comprehensive response" to the debt crisis that will be unveiled later this month, they will face much the same problems as a year ago -- except that after endless promises, bailouts and negotiations, jittery markets now appear at the end of their tether.
The leaders are expected to commit to keeping labor costs and public deficits in check to make their economies more competitive and their government finances more sustainable. They also will discuss lowering the interest rates on Ireland's euro67.5 billion ($93 billion) bailout and giving Greece more time to pay back its euro110 billion ($152 billion) rescue loan.
But the measures that markets have been waiting for the most -- giving the 17-nation eurozone's euro750 billion ($1 trillion) bailout fund powers that go beyond national loan packages -- already appear to be off the table.
Roughly 12 months into the debt crisis, economists are still wondering how Greece will ever pay off its enormous debt pile. Borrowing costs for Europe's weakest states are at record highs, rating agencies are downgrading their debt, while big question marks loom over the health of the continent's banks.
And the Germans are blocking any requests for more help.
Spring 2011 in Europe looks eerily like spring 2010.
And what's the likely reaction if the "comprehensive solution" fails to convince financial markets on March 25? The same as last year, a hastily called emergency meeting on a Sunday night, said Michels, possibly already on the first weekend of April.
Market jitters and clashing interests likely to hamper grand deal on eurozone rescue
German Chancellor Angela Merkel attends a joint news conference with the Prime Minister of Luxembourg, Jean-Claude Juncker, after a meeting at the chancellery in Berlin, Germany, Friday, March 4, 2011. (AP Photo/Michael Sohn)
Gabriele Steinhauser, AP Business Writer, On Friday March 11, 2011, 7:24 am EST
BRUSSELS (AP) -- When EU leaders gather here Friday to build the "comprehensive response" to the debt crisis that will be unveiled later this month, they will face much the same problems as a year ago -- except that after endless promises, bailouts and negotiations, jittery markets now appear at the end of their tether.
The leaders are expected to commit to keeping labor costs and public deficits in check to make their economies more competitive and their government finances more sustainable. They also will discuss lowering the interest rates on Ireland's euro67.5 billion ($93 billion) bailout and giving Greece more time to pay back its euro110 billion ($152 billion) rescue loan.
But the measures that markets have been waiting for the most -- giving the 17-nation eurozone's euro750 billion ($1 trillion) bailout fund powers that go beyond national loan packages -- already appear to be off the table.
Roughly 12 months into the debt crisis, economists are still wondering how Greece will ever pay off its enormous debt pile. Borrowing costs for Europe's weakest states are at record highs, rating agencies are downgrading their debt, while big question marks loom over the health of the continent's banks.
And the Germans are blocking any requests for more help.
Spring 2011 in Europe looks eerily like spring 2010.
And what's the likely reaction if the "comprehensive solution" fails to convince financial markets on March 25? The same as last year, a hastily called emergency meeting on a Sunday night, said Michels, possibly already on the first weekend of April.
