Eurozone: Varoufakis discusses the 'greatest beneficiary' in 2018
When you subscribe we will use the information you provide to send you these newsletters. Sometimes they’ll include recommendations for other related newsletters or services we offer. Our Privacy Notice explains more about how we use your data, and your rights. You can unsubscribe at any time.
Eurozone leaders have recently been warned a spike in inflation could lead to southern member states leaving the bloc to escape the unsustainable common currency. Generation Frexit leader Charles-Henri Gallois claimed sustained high inflation in the eurozone could lead to the euro “exploding”. Sharing an article by BFM businesses warning about the rise of prices by 4.2 percent in the US due to an inflation spike, Mr Gallois warned the same fate will await EU countries that have adopted the common currency.
The article also warns: “The latest figures from the United States speak for themselves: in April, prices rose 4.2 percent over one year.
“A first since September 2008 which has made the markets particularly nervous in recent days.
“Within the eurozone, although more moderate, inflation (+ 1.6 percent over one year) also seems to be accelerating.”
Mr Gallois echoed: “If inflation reached the eurozone for a long time, this could lead to the euro exploding.
“More inflation means higher interest rates and southern countries no longer able to finance themselves will cause forced exits from the eurozone in order to be able to monetise.”
As fears across the eurozone mount, unearthed reports shed light on how the bloc dealt with the southern-European debt crisis in 2010.
Ten years ago, British taxpayers were faced with a hefty bill when the UK was forced to sign a controversial EU bailout deal.
Former Chancellor Alistair Darling, who was representing Britain until a new government was formed, had to participate in a £95billion “stabilisation mechanism” aimed at saving the euro, even though Britain was never part of the monetary union.
JUST IN: EU’s Brexit punishment plan torn to shreds
In 2019 BBC documentary “Inside Europe: Ten Years of Turmoil”, Mr Darling recalled: “I was sipping my well-earned glass of wine when I got this very unwelcome call from my private officer saying: ‘Look you will need to go to Brussels on Sunday.
“‘Obviously, you are the Chancellor of the Exchequer until a new one is appointed, so you have got to go.'”
According to the documentary, EU commissioner Olli Rehn was next to phone Mr Darling to tell him that Britain had to contribute to save the euro.
Mr Darling added: “I said ‘look this is about stabilising the euro, we are not in the euro, there is no way I could agree to that even if we were definitely going to the Government.
“But even if we did agree to it, there is no way I can bind a new incoming Government, so I can’t agree to it and he was very taken aback by that.”
GB News’ Neil Oliver in withering attack against ‘squabbling’ SNP [REVEALED]
Keir Starmer’s brutal description of Jeremy Corbyn as leader [INSIGHT]
‘Boris burrow’ tunnel linking Scotland to NI may derail independence [ANALYSIS]
After an emergency meeting was called in Brussels, which then German Finance Minister Wolfgang Schauble could not attend, Mr Darling revealed how what he saw made him “very angry”.
He said: “The final attempt to get us in was amazing.
“What happened was they simply reordered the paragraphs on a piece of paper and it was still there that we were liable to contribute.
“And I really was getting very angry at this stage, we had been sitting around all afternoon.
“And I’m very slow to get angry with people but I was just so frustrated when all the time the clock was ticking away and they would not accept this.”
Despite Mr Darling’s opposition, he had no choice but to back down because the decision was taken under a Lisbon Treaty “exceptional occurrences” clause that stripped Britain of its veto.
The UK escaped being sucked into the wider bailout loans, but it was forced to underwrite the “stabilisation mechanism” which, added to an existing “facility” of £43billion, made the British taxpayer liable for £13billion of a new £95billion (€110billion) fund.
Source: Read Full Article