Adrian Hamilton: There's still (a slim) hope for the eurozone yet

World View

Share

You wouldn't know it from the coverage over here, but the Eurozone crisis has actually eased quite a lot of late. Stock markets are up, even ours (although it is flattening out at present). The euro has risen on the foreign exchanges. Most importantly, the bond yields of Spanish and Italian sovereign debt – the great worry of a month ago – are down substantially.

"The calm before the storm," cry the pessimists. "Just wait until the markets and the politicians return from holiday and you'll see." Greece is in as much trouble meeting its deficit-cutting promises as ever. Angela Merkel, together with François Hollande, is due to meet with the Greek Prime Minister next week. The so-called "troika" – of France, Germany and the European Central Bank – are due to report in late September, early October. The odds are still on a Greek failure to meet its obligations and an enforced exit from the currency.

At the same time, there is nothing in the figures to suggest that Spain or Italy's debt problems are getting any the better, while Germany's willingness to increase the scale and scope of a bailout is, if anything, hardening. The bailout itself is up before the German court as unconstitutional. Senior members of Chancellor Merkel's own party are becoming more open in their criticism of her policies.

If you want to find the negatives for the Eurozone, as 90 per cent of the British seem to want, you don't have to peer round the back of the curtains and behind the sofas to come across them.

And yet there is an alternative scenario which should not be ignored. It is that the eurozone doesn't just muddle on but muddles through this crisis. Tory MPs and anti-Europeans this side of the Channel keep presenting the markets as if they were some form of Old Testament host come down to Earth to punish sinners. They're not.

Funds and investors have reasons for nervousness but they also have reasons to wish the eurozone to succeed. What they have wanted, and until recently lacked, is some sign that European leaders were willing to let the ECB act, as the Bank of England has in the UK and the Fed has in the US, and enter the market in a big enough way to support Spanish and Italian bonds.

That, they believe, is now the case after the statements from both the Bank and Germany last month. ECB plans are still to be fleshed out in positive action. But the intention is there and this, for the moment, has proved enough to stem the crisis.

It's not the grand leap to common eurobonds that France wants or the fiscal union which Germany seeks. But there isn't the political consensus for that. Despite that, it should be enough to keep the financial crisis boiling over. Which might then allow leaders to concentrate on the most pressing problem of all, which is the economic slowdown in the region.

Even Germany is now not immune, which gives some hope that Europe will begin to take the action needed to raise spending and allow a degree of reflation. A slim hope, perhaps, but not an impossible one.

Syria's Christians don't benefit from false declarations of havoc

To read the British newspapers, you would think that the Christians of Syria were against the uprising and that they were under extreme threat from insurgents bent on the Islamicisation of the country.

Not so. The truth, according to Monsignor Mario Zenari, the papal nuncio in Damascus, is that relations with the Syrian Free Army are good and, despite some aggression from fundamentalists in the country, Christians have so far experienced no threat from the rebels.

Reports by the Greek Patriarch and others that non-Muslims are under attack are, so it is said, being deliberately manipulated by the government to spread alarm.

One hopes they are not true. The experience of Christians in Iraq or Egypt has not been good. But then the Coptic-Muslim tensions in Egypt were there well before the revolution. Syria has long been a multi-religious and multi-ethnic country. There is a real danger of inter-ethnic violence. But it hardly helps to declare havoc when it hasn't occurred nor to fall for Assad's claim to be the last barrier to anarchy. That's always the last refuge of authoritarian regimes.

a.hamilton@independent.co.uk

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Mobile Developer (.NET / C# / Jason / Jquery / SOA)

£40000 - £65000 per annum + bonus + benefits + OT: Ampersand Consulting LLP: M...

Humanities Teacher - Greater Manchester

£22800 - £33600 per annum: Randstad Education Manchester Secondary: The JobAt ...

Design Technology Teacher

£22800 - £33600 per annum: Randstad Education Manchester Secondary: Calling al...

Foundation Teacher

£100 - £125 per day: Randstad Education Chelmsford: EYFS Teachers - East Essex...

Day In a Page

Read Next
Critics of Fiona Woolf say she should step down amid accusations of an establishment cover-up  

Fiona Woolf resignation: As soon as she became the story, she had to leave

James Ashton
 

Letters: Electorate should be given choice on drugs policy

Independent Voices
Bryan Adams' heartstopping images of wounded British soldiers to go on show at Somerset House

Bryan Adams' images of wounded soldiers

Taken over the course of four years, Adams' portraits are an astonishing document of the aftermath of war
The drugs revolution starts now as MPs agree its high time for change

The drugs revolution starts now as MPs agree its high time for change

Commons debate highlights growing cross-party consensus on softening UK drugs legislation, unchanged for 43 years
The camera is turned on tabloid editors in Richard Peppiatt's 'One Rogue Reporter'

Gotcha! The camera is turned on tabloid editors

Hugh Grant says Richard Peppiatt's 'One Rogue Reporter' documentary will highlight issues raised by Leveson
Fall of the Berlin Wall: It was thanks to Mikhail Gorbachev that this symbol of division fell

Fall of the Berlin Wall

It was thanks to Gorbachev that this symbol of division fell
Halloween 2014: What makes Ouija boards, demon dolls, and evil clowns so frightening?

What makes ouija boards and demon dolls scary?

Ouija boards, demon dolls, evil children and clowns are all classic tropes of horror, and this year’s Halloween releases feature them all. What makes them so frightening, decade after decade?
A safari in modern Britain: Rose Rouse reveals how her four-year tour of Harlesden taught her as much about the UK as it did about NW10

Rose Rouse's safari in modern Britain

Rouse decided to walk and talk with as many different people as possible in her neighbourhood of Harlesden and her experiences have been published in a new book
Welcome to my world of no smell and odd tastes: How a bike accident left one woman living with unwanted food mash-ups

'My world of no smell and odd tastes'

A head injury from a bicycle accident had the surprising effect of robbing Nell Frizzell of two of her senses

Matt Parker is proud of his square roots

The "stand-up mathematician" is using comedy nights to preach maths to big audiences
Paul Scholes column: Beating Manchester City is vital part of life at Manchester United. This is first major test for Luke Shaw, Angel Di Maria and Radamel Falcao – it’s not a game to lose

Paul Scholes column

Beating City is vital part of life at United. This is first major test for Shaw, Di Maria and Falcao – it’s not a game to lose
Frank Warren: Call me an old git, but I just can't see that there's a place for women’s boxing

Frank Warren column

Call me an old git, but I just can't see that there's a place for women’s boxing
Adrian Heath interview: Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room

Adrian Heath's American dream...

Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room
Simon Hart: Manchester City will rise again but they need to change their attitude

Manchester City will rise again but they need to change their attitude

Manuel Pellegrini’s side are too good to fail and derby allows them to start again, says Simon Hart
Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

A Syrian general speaks

A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities