In a speech at the European Parliament, Bronislaw Komorowski, the Polish President, called for greater European integration as the solution to the Eurozone crisis.
Although Poland is outside of the Euro area, it currently holds the Presidency of the European Union. The country also has a historic attachment to the European political project. On 13th September 2011, the Polish President hailed the integration of Europe as a positive factor which helped Poland to develop after the fall of the Iron Curtain in the early nineties.
“We know that at stake is the future of the project of fundamental importance for Europe and its place in the world. The disintegration of the Euro and monetary union could be a prelude to the reversal of the process of integration with the worst possible consequences, including rejection of the union as a political project.”
The President underlined his support for the EU’s Stability and Growth Pact and promised to keep EU public finances in check.
His comments come amid growing speculation over the future of the Euro and European economies in general. On 11th September, the Deputy Prime Minister and Finance Minister of Greece, Angelos Venizelos, admitted that governance of the Euro was becoming unwieldy:
“There is no doubt that the lack of comprehensive institutions of economic governance at European and international level, acts as a catalyst for influencing political and institutional developments, particularly as the European Union is an intermediate stage in the historical and institutional process of European integration.
“This is the big problem of our continent, this is the big problem of the Eurozone which has the force of the common currency, the Euro, which is equally important to the dollar in international markets, but is not accompanied by the appropriate institutional and political support, because the Eurozone is a union of states that operates as an enlarged cooperation within the European Union rather than a mature integrated federal state like the U.S..”
The Minister went on to blame bad publicity for a misunderstanding about the magnitude of the Greek debt crisis, downplaying the effect of Greece’s fiscal crisis on the debate over the future of the Euro:
“Greece is a typical European country belonging to the 27 strongest economies in the world despite the crisis, and despite the recession, is a country that has achieved a lot in recent decades thanks to its citizens and their sweat, but it is not the center of Europe. It is very small. Greece is not the catalyst for the future of the Eurozone.
“We are approximately 2% of GDP in the Eurozone, a little less than 3% of public debt in the Eurozone. There are other countries that have 25% of government debt in Euro area alone. These are the countries that can influence the GDP of the Eurozone.”
It has long been known that the Euro project would need to address a governance issue in the future in order to co-ordinate policy in the face of significant currency pressures. As a whole, the European Union has been accused of creating a “democratic deficit” that distances citizens from decision making and ultimately putting the fates of millions in the hands of supranational and ad-hoc bodies such as the IMF and the G7.