15 Ağustos 2012 Çarşamba

Deeply wounded Eurozone

While our neighboring country Syria has been struggling to win democratic rights against the tyrannic leader, their conditions are not suitable to consider the economic situation.

In fact, the economy has completely collapsed, the single thought for the Syrian people immediately to get freedom, to end merciless and unjust carnages to which they have been exposed for one and half years.

In terms of Europe, its economy has been trying to get recovery since 2008.

Downward trend is persisting its impression in the economy of European Union. According to analysts and indicators, full recovery expected would be achieved in 2014 and 2015.

The foremost problem of the union is budget deficits.

In order to prevent the deficits, the officials of the union are preparing new measures to handle the crisis.

The analysts say the arguments about European policy are taking on a “very dangerous” tone, as worries mount about the future of the euro.

Pessimist and negative developments sustain their effect in the economy and cause to emerge concerns about union monetary unit, euro.

As for the European Central Bank, it is decisive to preserve euro.

Meanwhile, the constrictions in the economy lead to layoffs.

The number of people unemployed across the 17 countries that use the euro had hit a record high in June; Europe’s debt crisis has ramifications beyond the financial markets.

The unemployment rate maintains its upward trend in the eurozone, posted as 11.2 percent in June.

Eurostat, the EU’s statistics office, said 17.801 million people were out of work in the eurozone in June, 123,000 more than May, and is the highest level since the euro was formed in 1999.

Spain, which is at the forefront of Europe’s debt crisis concerns, had the highest unemployment rate across the eurozone of 24.8 percent.

Spain’s downturn deepened in the second quarter, with the economy shrinking 0.4 percent after contracting 0.3 percent in the first three months of 2012, the government said the economy would continue in recession next year, shrinking 0.5 percent instead of growing 0.2 percent as previously expected.

Spain was forecast to return to growth of 1.2 percent in 2014 and 1.9 percent in 2015.

As for Greece’s rate was not far behind staying at 22.5 percent.

According to a source, political leaders in Greece have agreed on most of the austerity measures demanded by its creditors and are now eyeing wage cuts to get the final 1.5 billion euros of savings still needed.

It was also indicated that Greece also must acquire savings worth 11.5 billion euros for 2013 and 2014 to satisfy its increasingly impatient lenders.

Many countries that use the euro, including France and Italy, also have double-digit unemployment rates. Germany, Europe’s biggest economy, its unemployment rate, according to Eurostat, dropped to 5.4 percent in June from 5.5 percent in May.

Another foremost country, the UK economy slumped 0.7 percent in the 2nd quarter, worse-than-expected amount in the second quarter.

Developments in European economy commented that conditions “bear the traits of a psychological dissolution of Europe”.

In conclusion, new measures expected to be arranged for Europe to handle the crisis.

It is said that it was not seen any room for further concession and popular budget in economy.

On the agenda of eurozone there are layoffs, a cap on pensions, cuts in welfare benefits, reductions in tax exemptions, and lower salaries for public employees as well as raising the retirement age by a year to make up for the shortfall in savings, according to the statements.

However, European Central Bank president Mario Draghi announced the bank “is ready to do what it takes to preserve the euro.”

German Chancellor Angela Merkel and French President Francois Hollande also vowed to do "everything to protect the eurozone".