Eurozone CRUMBLING: Alarm bells for future of euro as expert issues warning

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Dr Daniel Stetler also claimed the bloc’s determination to phase out fossil fuels in favour of renewable energy posed a grave risk to its economy. The management consultant and founder of the discussion forum Beyond the Obvious said the euro was increasingly causing splits because the introduction of the single European currency was making stronger countries stronger, and weaker ones weaker.

This development has been whitewashed for years by the policy of the ECB

Dr Daniel Stetler

Writing for German magazine Focus, Dr Stetler explained: “This development has been whitewashed for years by the policy of the ECB, the increasing imbalances in the European payment system Target2 and the ever-increasing national debt.

“This was the only way to keep the illusion of prosperity up.”

Referring to the £677billion coronavirus rescue package agreed by the European Council in June, Dr Stetler said: “With the corona crisis, the problems came to light again and led to the breach of the dam: the open entry into a transfer and debt union.

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“Both of these only work because Germany’s economic performance is now available as collateral.

“The possibility of the German state to burden local citizens and companies in the future gives the EU creditworthiness.

“In plain language: As long as the German economy is running, the EU will stick together.”

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Neither Brussels nor Berlin doubted Germany’s ability to be the guarantor of a “an increasingly ailing EU”, Dr Stetler said.

However, he added: “The advances in productivity – ie the growth in prosperity – have been falling significantly for years.

“Industry is increasingly relocating production abroad and we are lagging far behind on important issues such as digital infrastructure.”

Dr Stetler is also deeply concerned at EU energy policy, which he said was becoming “an existential threat”.

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He explained: “The tightening of climate protection targets is supported by the Europeans’ conviction that they must – and can – take on a global pioneering role.

“In Japan alone over 20 new coal-fired power plants will go live by 2025? Doesn’t matter.

“Over 150 new coal-fired power plants are being prepared worldwide? Doesn’t matter either.

“The local hope is that renewable energies will soon make fossil fuels redundant.”

Because renewable alternatives were not always available, it was vital to have a fossil or nuclear back-up available, Dr Stelter said.

He added: “Therefore, the higher the share of renewable energies, the higher the electricity costs.

“This can be seen in Germany, the country with the highest electricity prices in Europe, despite, no, because of the high proportion of renewable energies.”

He also highlighted the push to dramatically reduce the number of cars in Europe by 2040, and the requirement that they should be electric – a change Germany’s massive car industry is not well-prepared for.

Dr Stetler added: “One thing is certain: it is of very little use to the global climate if CO2 emissions occur in other regions of the world instead of here.

“It is also clear that the EU as an affluent community has no chance if Germany’s economic power falls away.

“The EU can still decide how to achieve the CO2 targets. With or without preserving the Union.”

(Additional reporting by Monika Pallenberg)

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