The leaders of countries and organisations in the European Union gathered and made the first step towards 'tightening the screws' in the financial sector of the European Union. In countries such as Cyprus and Greece, banks are failing and the economy is falling apart completely. As these countries are part of the Eurozone, it is up to them to do something about it. For months and even years have the Eurozone leaders relied on powers such as Germany, however Germany can not fund them forever either. A plan worth EUR 55 billion has been created, that will be backed up by various banks and agencies in order to fix the situation of the failing banks, as well as reduce the costs of doing this, as over EUR 1 trillion has potentially been spent to 'prop' up the Eurozone banks, which is not acceptable, and must be dealt with immediately.
"If we continue... on the path toward banking union then we will be able to continue the stabilisation of the European currency as the basis for a return to stable growth in Europe," said German Finance Minister, Wolfgang Schaeuble.
This plan will try to reduce, limit or even finish the reliance of governments on taxpayers bailouts. The Cyprus situation has taught us enough, and that is exactly what is being avoided.
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| http://roarmag.org/2011/07/greece-to-default-on-debt-amid-escalating-euro-crisis/ |
Source(s):
http://www.bbc.co.uk/news/business-25441232
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