Gold Magazine September - October 2013, Issue 30 | Page 20

interview

five minutes with...

Tony Barber

Europe Editor, Financial Times
Panelist at the 4th Limassol Economic Forum

W

ith fiscal adjustment
programmes, rising
unemployment and
social outrage aimed
politicians and the EU institutions, is
Europe going in the wrong direction?
For sure, these are the most difficult
times facing Europe in economic terms
since the aftermath of World War II. The
failure of EU institutions and national
politicians to find satisfactory answers
as fast as the public wants is dividing
some countries from others and is straining faith in the ideal of European unity.
To that extent, Europe is going in the
wrong direction. However, it is mistaken
to think there is a “right” direction on
which everyone can agree. The crisis of
low long-term economic growth, high
public and private sector debt, fragile
banking systems and weak job creation
is one that predates the financial turmoil
that erupted in 2008. There was no
agreement on common solutions before
2008 and I see no reason to believe there
will be such agreement in the future
– though that does not preclude more
short-term fixes and medium-term good
intentions of the kind we have become
familiar with.
Five months after the events of March
2013, which ended with the painful bail-in of the two major banks in
Cyprus, how would you rate the EU’s
decision-making procedures?
For many years the EU has made a habit
of taking its most important decisions

at meetings that drag on throughout the
evening and night, making the participants tired, irritable and better at haggling
than arriving at optimal solutions. The
first March summit on Cyprus was a classic of this kind. But, in their defence, the
reason why EU policymakers go about
their business in this way is that they
regard the Union as a family or club in
which decisions should be reached by
compromise and consensus wherever
possible. This explains why the initial
decision on Cyprus incorporated the wish
of President Nicos Anastasiades to make
ordinary bank deposit holders share some
of the cost of the financial rescue. But one
has to ask if eurozone finance ministers
would have made this unfathomably inept
choice if they had been discussing Cyprus
with clear heads at a normal time of day.
How much is the result of the German
elections likely to alter the economic
debate in Europe?
I doubt that the German e