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

Austen Lloyd: Private Client Solicitor - Oxford

Excellent Salary : Austen Lloyd: OXFORD - REGIONAL FIRM - An excellent opportu...

Austen Lloyd: Clinical Negligence Associate / Partner - Bristol

Super Package: Austen Lloyd: BRISTOL - SENIOR CLINICAL NEGLIGENCE - An outstan...

Recruitment Genius: Sales Consultant - Solar Energy - OTE £50,000

£15000 - £50000 per annum: Recruitment Genius: Fantastic opportunities are ava...

Recruitment Genius: Compute Engineer

Negotiable: Recruitment Genius: A Compute Engineer is required to join a globa...

Day In a Page

Read Next
Syrian refugee 'Nora' with her two month-old daughter. She was one of the first Syrians to come to the UK when the Government agreed to resettle 100 people from the country  

Open letter to David Cameron on Syrian refugees: 'Several hundred people' isn't good enough

Independent Voices
Amjad Bashir said Ukip had become a 'party of ruthless self-interest'  

Could Ukip turncoat Amjad Bashir be the Churchill of his day?

Matthew Norman
Syria crisis: Celebrities call on David Cameron to take more refugees as one young mother tells of torture by Assad regime

Celebrities call on David Cameron to take more Syrian refugees

One young mother tells of torture by Assad regime
The enemy within: People who hear voices in their heads are being encouraged to talk back – with promising results

The enemy within

People who hear voices in their heads are being encouraged to talk back
'In Auschwitz you got used to anything'

'In Auschwitz you got used to anything'

Survivors of the Nazi concentration camp remember its horror, 70 years on
Autumn/winter menswear 2015: The uniforms that make up modern life come to the fore

Autumn/winter menswear 2015

The uniforms that make up modern life come to the fore
'I'm gay, and plan to fight military homophobia'

'I'm gay, and plan to fight military homophobia'

Army general planning to come out
Iraq invasion 2003: The bloody warnings six wise men gave to Tony Blair as he prepared to launch poorly planned campaign

What the six wise men told Tony Blair

Months before the invasion of Iraq in 2003, experts sought to warn the PM about his plans. Here, four of them recall that day
25 years of The Independent on Sunday: The stories, the writers and the changes over the last quarter of a century

25 years of The Independent on Sunday

The stories, the writers and the changes over the last quarter of a century
Homeless Veterans appeal: 'Really caring is a dangerous emotion in this kind of work'

Homeless Veterans appeal

As head of The Soldiers' Charity, Martin Rutledge has to temper compassion with realism. He tells Chris Green how his Army career prepared him
Wu-Tang Clan and The Sexual Objects offer fans a chance to own the only copies of their latest albums

Smash hit go under the hammer

It's nice to pick up a new record once in a while, but the purchasers of two latest releases can go a step further - by buying the only copy
Geeks who rocked the world: Documentary looks back at origins of the computer-games industry

The geeks who rocked the world

A new documentary looks back at origins of the computer-games industry
Belle & Sebastian interview: Stuart Murdoch reveals how the band is taking a new direction

Belle & Sebastian is taking a new direction

Twenty years ago, Belle & Sebastian was a fey indie band from Glasgow. It still is – except today, as prime mover Stuart Murdoch admits, it has a global cult following, from Hollywood to South Korea
America: Land of the free, home of the political dynasty

America: Land of the free, home of the political dynasty

These days in the US things are pretty much stuck where they are, both in politics and society at large, says Rupert Cornwell
A graphic history of US civil rights – in comic book form

A graphic history of US civil rights – in comic book form

A veteran of the Fifties campaigns is inspiring a new generation of activists
Winston Churchill: the enigma of a British hero

Winston Churchill: the enigma of a British hero

A C Benson called him 'a horrid little fellow', George Orwell would have shot him, but what a giant he seems now, says DJ Taylor
Growing mussels: Precious freshwater shellfish are thriving in a unique green project

Growing mussels

Precious freshwater shellfish are thriving in a unique green project