Search

EU must put aside differences, flex world muscle-ECB

Reuters - Wednesday, June 25

BRUSSELS, June 24 - Europe needs to put aside its differences and start flexing its muscle in global affairs or face up to the fact that it may be overtaken by India and China, a top European Central Bank policymaker said on Tuesday.

"There is one big, uncomfortable fact that Europe and its member states have to face. As time goes by, their relative weight in the world economy will decrease," ECB board member Lorenzo Bini Smaghi said in a speech to a parliamentary economics committee in Brussels.

"If recent trends continue, by 2020 the share held by the European economy will fall from around 23 percent to 18 percent of the world economy ... In the decade thereafter, China and possibly India could overtake the whole of the euro area."

Bini Smaghi urged EU states to pool their representation at international bodies such as the International Monetary Fund, a stance recently backed by Eurogroup chairman Jean-Claude Juncker.

Bini Smaghi said Ireland's recent rejection of the Lisbon Treaty showed Europeans were still uncertain about the idea of a united Europe and baffled by the EU's decision-making processes and inner workings.

"Ireland's recent rejection of the Lisbon Treaty reflects the confusion that many citizens feel about Europe," Bini Smaghi said.

"Recent experience shows that opaqueness and lack of clarity undermine our fellow citizens' respect for and even their interest in the European 'construction' ... This has created confusion for the citizens of Europe," he said.

National governments and European institutions needed to stop squabbling and decide whether the EU wanted to be an influential global player.

"The euro area, and more generally the EU countries, have to make a choice. Do they want to have a say in the governance of globalisation or do they want to opt out of it?" he said.

"Assuming that the EU, or the euro area, wants to be an active player on the global stage, is it then ready to accept the consequences, particularly in terms of internal governance?"

Recommend this article

Average (0 votes)
0 stars
Sign in to recommend this article »
Most Recommended Stories »

Related Articles: China's Economy

Related Articles: Business