At the end of the “European generosity attraction”, when rich countries pay for the needs of the poor, the eurozone may fall apart. Vladimir Grigoriev, Associate Professor of the Institute of World Economy and Business of the Peoples’ Friendship University of Russia, spoke about this on September 1.
In free fall: the euro has become cheaper than the dollar for a long time
The European currency is under pressure from two sides at once – due to the energy crisis and the financial policy of the ECB
In an interview with the Prime agency, Grigoriev said that under a mild scenario of collapse, the states that make up its core will remain in the eurozone: Austria, Belgium, Germany, Italy, Luxembourg, the Netherlands, and France. In the case of a tough scenario, the expert predicts the full restoration of the national economic sovereignty of countries.
As the expert recalled, the European Union adhered to the policy of cohesion, which involves subsidizing countries with weaker economies.
Grigoriev stressed that with the advent of the economic and energy crises in the region, such a policy is gradually being curtailed.
“Now this happiness is ending: the generosity of the core countries of the European Union, appropriate in the years of economic growth, is giving way to tough pragmatism and austerity, which are more than appropriate now, in an era of crisis, intensified first by the coronavirus pandemic, and now also by the reverse effect of anti-Russian sanctions,” the expert explained.
Earlier in the day, the economist warned about the risk of the collapse of the EU due to Poland’s refusal to adopt the euro. According to the head of the department of world financial markets and fintech of the Russian University of Economics. G.V. Plekhanov Denis Perepelitsa, Poland’s proposal to allow eurozone countries to return to the use of national currencies and Warsaw’s unwillingness to switch to the euro could lead to the collapse of the European Union.
Earlier, on August 31, the statistical office of the European Union reported that annual inflation in the eurozone will be 9.1%, showing the highest level in history. According to preliminary data, the largest contribution to inflation will be made by energy, the price growth for which will accelerate to 38.3%.
Prior to this, on August 29, Polish Prime Minister Mateusz Morawiecki said in an interview with Le Figaro that disagreements between EU countries on the issue of Ukraine could lead to an “internal explosion” in the EU.
On August 22, Polish Foreign Minister Zbigniew Rau said in an article for the newspaper Rzeczpospolita that in order to restore equality of the EU member states, it is necessary to reform the eurozone. In his opinion, this reform should not exclude the possibility of temporary or permanent refusal of some states from the common European currency.
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