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Tuesday, August 16, 2011

Eurozone crisis fatigue

It has reached crunch time in Europe. French President Nicolas Sarkozy and German Chancellor Angela Merkel have had yet another round of emergency talks in Paris today in a bid to solve the eurozone crisis for the umpteenth time. On Wednesday, the Swiss Central Bank is holding a meeting to discuss how it can prevent its currency’s strong appreciation against the euro; to peg or not to peg? And also this week, the Dutch parliament is holding a round of parliamentary debates on the country’s participation in the EFSF. These debates are significant because come October, there will be key votes in national parliaments on some of the rescue measures which have yet to be approved.

And the popular opinion in Triple A countries seem to showing signs of some serious bailout fatigue - spilling over to fading support for the euro itself (and probably the European project as a whole). On Saturday, a poll commissioned by Dutch paper AD found that 48% of those questioned wanted the Netherlands to leave the euro and would prefer a return to the Dutch guilder.

A separate poll published on Sunday by Maurice de Hond and No Ties BV was more damning, showing that 54% of Dutch voters want Greece and other peripheral countries expelled from the eurozone rather than being rescued again. It also found that 60% want the Netherlands to stop lending money to other eurozone countries while 48% of respondents believe that the euro’s negatives outweigh its benefits. Pretty heavy stuff.

It will be interesting to see how much these parliamentary debates are influenced by the recent poll results, and whether the Liberal-Christian Democrat coalition can muster the support from opposition parties needed to pass the bailout legislation. Despite domestic opposition, our bet is on the latest bailout rounds being passed fairly comfortably in the Dutch parliament.

Over in Germany, the picture looks very similar. A survey recently conducted by the German institute Emnid and published by German paper Bild am Sonntag showed that 31% of Germans believe the euro will disappear by 2021.

Another poll carried out by British pollster YouGov, reveals that 44% of Germans respondents want Germany to leave the eurozone, compared to 48% who want Germany to stay in. And 58% of respondents in Germany and 53% in France said they want Greece to leave the eurozone.

Meanwhile, in Finland, a Helsingin Sanomat poll conducted in July revealed that 44% of Finns questioned said Greece should leave the euro. Although, only 23% said they wanted to return to their previous currency - the Markka.

As ever, the question is when such public sentiments will seriously begin to feed through to national elections - and when politicans will begin being thrown out of office over them.

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