As discussions took place across EU capitals over whether to bail Greece out, protesters marched through Athens over the Greek government’s plans to reduce the debt deficit
The European single currency is facing an 'inevitable break-up' a leading French bank claimed yesterday.
Strategists at Paris-based Société Générale said that any bailout of the stricken Greek economy would only provide 'sticking plasters' to cover the deep- seated flaws in the eurozone bloc.The stark warning came as the euro slipped further on the currency markets and dire growth figures raised the prospect of a 'double-dip' recession in the embattled zone.Claims that the euro could be headed for total collapse are particularly striking when they come from one of the oldest and largest banks in France - a core founder-member.
'Any "help" given to Greece merely delays the inevitable break-up of the eurozone.'The alarming claim came a day after European Union leaders promised 'determined and co-ordinated' action to shore up Greece's tattered public finances, but disappointed traders by failing to provide specifics.
Further details are expected early next week, but markets were in high anxiety yesterday amid fears political divisions among rich eurozone members could derail any rescue.
The euro slid almost 1 per cent to $1.357 yesterday, meaning it has lost 10 per cent of its value since November. The pound rose to 1.14 euros.Earlier this week Business Secretary Lord Mandelson's claimed that the single currency had been a 'remarkable success' and that it remained in Britain's interests to join.
David Cameron ridiculed that claim yesterday.He told the Tories' Scottish conference: 'Are this Government the only people in the country who still think that would be a good idea? Our deficit and debt are bad enough without the straightjacket of the euro.
'If I am elected for as long as I am prime minister the United Kingdom will never join the euro.'The eurozone is facing a fully-fledged crisis. The Greece episode has made it painfully clear how flawed the euro project was from the very beginning.
'Even if Greece receives a one-off bailout it would not solve the real problem, which is the huge differences in competitiveness between the eurozone's richest and poorest members.
If these differences are to be evened out, the EU would need a single budget and common taxes so it can redistribute resources.'One thing is clear, Britain made the right choice in staying out.'Mr Edwards argued that Portugal, Ireland, Greece and Spain are too economically weak to withstand the rigours of eurozone membership.
Harvard University Professor Martin Feldstein, a long-standing sceptic on the euro, yesterday said the single currency 'isn't working' because member governments have no incentive to keep their public debts under control.
How long before all of the countries start giving up on Euro... Britain and Russia did a smart thing by not joining the EU, and number of other countries...Sooner or later other countries are gonna start requesting bailouts in order to improve their economy... its just a matter of time before the Euro is abandoned.....