Quadriga
One crisis meeting follows another. Europe is on the verge of financial meltdown; the continent's financial and currency watchdogs appear helpless. First Greece, Ireland and Portugal - now Italy could be the next country to go bust. Ratings agencies and financial markets have the former economic powerhouse in their sights. Brussels - which is already struggling to save Greece from bankruptcy - has to cobble together yet another bailout package. Many analysts believe Europe could crumble under the burden of Italy's debt. A frightening outlook for the euro, the eurozone and Europe.
With its tubulent domestic politics, Italy was rarely seen as one of Europe's most stable nations. But economically, it has long been Europe's third-largest power. It was a founding member of the European Economic Community, and still counts among the G8, the world's leading industrialized nations. That seems hard to believe, given the steady amassing of a national debt which now totals 1.8 trillion euros. Italy's debt is higher than its GDP. The government has to stump up 340 million euros this year to service its debt - and that sum will only increase in coming years. Italy is floundering. Prime Minister Silvio Berlusconi has announced an austerity package, but investors and others doubt this will be enough. And a bailout for Italy is more than Europe can afford.
Despite the best efforts of politicians, and daring, controversial moves by financial experts, things are coming to a head. ECB head Jean-Claude Trichet, Eurogroup chief Jean-Claude Juncker, Monetary Affairs Commissioner Olli Rehn and European Commission President Jose-Manuel Barroso are desperately seeking solutions. What should they do against markets that promote the sale of Italian assets, and stopped the trading of shares in Italian bank Unicredit after they fell by 6.6 percent? What should they do against the frequently questionable downgradings by US ratings agencies? Are they just evil speculators who should be stopped, as Chancellor Angela Merkel recently said? Or are they making the right calls and their warnings should be taken more seriously, and sooner? Why is there no sign of a well-organized European ratings agency? Politicians seem to react only on a case-by-base basis. There's no time for long-term planning - and soon, the money could run out.
What's your opinion? Italy's debt crisis - The euro under threat
Write us at quadriga@dw-world.de
Our guests:
Ulrike Herrmann – started her career in banking before taking up journalism at the Henri Nannen School afterwards studying history and philosophy at Berlin’s Free University. She then worked as a research assistant at the Körber Foundation and was the press officer for Hamburg’s Equal Opportunities minister, Krista Sager. In 2000 she became a political correspondent and business editor at the Berlin daily "taz". These days she is the responsible editor for the opinion page of this newspaper.
Quentin Peel - he is international affairs editor of the Financial Times. He is also an associate editor, responsible for leader and feature writing. He has been with the FT since 1975. Between 1976 and 1994 he served successively as southern Africa correspondent, Africa editor, European Community correspondent and Brussels bureau chief, Moscow correspondent, and chief correspondent in Germany. On his return to London he became foreign editor. He took up his present position in September 1998. He was born in July 1948 and educated at Queens’ College, Cambridge, where he
Angelo Conte - While studying literature and history at the University of Trento he worked as a freelance journalist. Since 1999 he has been with the local Italian newspaper L’Adige where he is responsible for the business desk. He is particularly interested in German-Italian relations and divides his time between Trento and Berlin. He is a regular correspondent for the German news agency DPA and several Berlin newspapers including Tagesspiegel and the Berlin Morgenpost.