CityAM, May 21, Barnabas Reynolds
The Eurozone is half-complete.
Control over the euro currency is centralised, but member state financial arrangements are individualised, creating almost intolerable tensions. That much is well known. What is not so well known is how this set-up operates to the detriment of the UK in three crucial ways. First, the value of the euro is structurally depressed relative to the economies in the northern Eurozone as a result of the over-indebtedness of the southern countries.
As a result, northern Eurozone exporters are dumping artificially low-priced products on the UK (and around the world), contravening WTO law rules on fair trade. Secondly, the Eurosystem makes available unlimited funding to any Eurozone buyer wanting to buy (predominantly northern) Eurozone products, unfairly subsidising Eurozone manufacturers. And thirdly, the entire set-up creates phenomenal financial risk through EU law’s misapplication of international regulatory rules, failing to recognise that because member states do not control the European Central Bank they are constantly at risk of defaulting on their debts.
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