Fair Observer’s Editor-in-Chief Atul Singh discusses John Bruton’s observation that Europe faces a tough winter. Bruton was prime minister and finance minister of Ireland. He was also the EU ambassador to the US.
Singh agrees with Bruton about his prognostication. Rising energy and, in particular, gas prices has led to record postwar inflation. Both households and industry are in trouble. Germany and Italy, the two European manufacturing strongholds, are suffering most.
Germany might face a winter of discontent. Italy has already elected Giorgia Meloni, a fiery populist politician, as its first woman prime minister. Meloni and her counterparts in Greece, Spain and Portugal face a grim challenge. Their economies are stagnant with high debts, aging populations and few jobs. High inflation is leading to higher interest rates. This makes debt more expensive and these southern economies might need another bailout.
So far, Germany has largely bailed out Southern Europe. That might be difficult given the state of the German economy. The economic trouble triggered by the Russia-Ukraine War will deepen divisions in Europe. The EU and its Euro project will face unprecedented strains in the pivotal winter ahead.
The views expressed in this article/video are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.