Actual Euro crisis

History – important data

 European Coal and Steel Community
- escape from the extreme forms of nationalism (Belgium,
France, Italy, Luxembourg, the Netherlands, and West Germany)

 Treaties of Rome (1957)

- European Economic Community
- European Atomic Energy Community
- came into force in 1958
 European Communities

1st July 1967

Single set of institutions for the three communities

Enlargement include Denmark (including

Greenland, which later left the Community in
1985), Ireland, and the United Kingdom
 In 1985, the Schengen Agreement
- creation of open borders
 Maastricht Treaty

- In 1995 Austria, Finland and Sweden

- In 2004 Cyprus, the Czech Republic, Estonia, Hungary,
Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia
- In 2007 Romania and Bulgaria

 On 1st December 2009 Lisbon Treaty

- changed the legal structure of the European Union
 Irresponsible bankers

Expansionary policy of cheap credit

Debts

15th September 2008 hit the crises

Debt crisis

High public debt

Source: www.wrsc.org
 Structural disparity

The euro zone is not an optimal currency

area

Differences in competitiveness
Bad allocation of capital

The capital began to flow into the economy which,

although offer higher interest profit, but only at
the cost of higher risk
 Wrongly institutionally set

How to deal with crises and how to solve it?

How can country leave EU?

Postponing problems……

Countries were entering the crises with some

degree of structural deficits
 Debt transfer

Debts of
private sector
Debts of
public sector

Debts of
international
Institutions
(MMF, ECB)
 Dealing with crises
 European Financial Stability Facility (EFSF)

- May 2010

- Protect members of euro-zone against financial instability

(financial assistance )

- Agreed by the 27 member states

- Issue bonds or other debt instruments

 European stabilization mechanism

- In March 2011

- Permanent rescue funding programme

- Launched as soon as Member States representing 90%

of the capital commitments have ratified it

- Expected in July 2012

 Euro-Plus Pact

– Commitments

– Political reforms

– To improve the fiscal strength and

competitiveness of each country

– Ordered to anchor in the Constitution balanced

management of public finances, ordering raise
the age of retirement, allows to influence wages
and determine unified corporate tax base
Euro-Plus Pact participants Euro-Plus Pact participants Other EU members
members of the Eurozone not members of the Eurozone
 Future…?

Global debate

Should be
Unsuccessful
preserved project
 Angela Merkel:

„If the euro currency fails, it will not mean only

the failure of the currency. It will be the failure of
Europe and the idea of European unification. We
have a common currency but no common
political and economic union. And that’s exactly
what we need to change.”
 Václav Klaus

“Creating a common European currency was not

necessary and how the reality in past years
shows, it was not far-sighted step.”
 Angela Merkel, has the future of Europe in her
hands

 Germany holds the key to resolving the euro

zone’s sovereign-debt crisis

 Biggest creditor country

 Conclusion

 Absolutely incalculable consequences

 To get rid of the euro – no solution!

 Trade wars, devalued against each other,

implement or raising duties, limiting
imports and support exports
 Crisis of policy

 Lack the vision, objectives and with natural

ability to convince people

 Politicians can not even set a short-or

long-term goals, they provide only first aid,
and still wrong

 Human values and democracy fall

Thank you!
References:

• http://www.economist.com
• http://machacek.blog.ihned.cz/c1-53873160-krize-
evropska-a-nejen-dluhova
• http://zpravy.tiscali.cz/merkelova-krize-eura-muze-
evropu-semknout-34069
• http://zpravy.tiscali.cz/tvrda-kritika-od-klause-eurozona-
byla-od-pocatku-chybny-projekt-102118
• http://www.mediafax.cz/ekonomika/3975876-Tomsik-
Krize-eurozony-je-dlouhodoba-od-roku-2010-ma-
podobu-krize-dluhove
• www.wikipedia.org