An uncertain future

The future of the euro — and of the European Union — are the most important topics for the business press this week.

Not so bad

The Financial Times argues that a weak euro is good for the eurozone economy, since it makes European exports cheaper.

…If the euro’s weakness — or the eurozone’s competitiveness, which is the same thing — persists for some time, it will boost the net exports of all eurozone countries. That would move the common currency area into external surplus from the broad balance it maintains today. This should please Germany, the external surplus nation par excellence, which seems to think that the eurozone’s main problem is that other members are not sufficiently similar to itself. …

No going back

The rescue plan for the euro is ambitious and necessary. But no one is sure how it will work, writes The Economist.

… The one thing that seems clear is that all this will lead to greater interference in countries’ politics. … Just as weak southern-tier economies need to free up their labour and product markets and boost competitiveness, so surplus countries like Germany need to promote spending at home. The scene is set for an ugly political battle over how to run Europe.