Wolfgang Munchau talks on the Eurozone and the current financial crisis
The Director of EuroIntelligence and Associate Editor of the Financial Times gives a talk to staff and students on the development of the current crisis in Europe
On 17 February 2009 iCES Distinguished Visiting Fellow at the European Business School London, Mr Wolfgang Munchau delivered an iCES and Student Union Lecture on Europe, the Eurozone and the global economic crisis.
Professor Scriven introduced the speaker on behalf of iCES commenting on the strategic importance of Munchau's work on EuroIntelligence as one of the foremost essential online resources on European financial matters.
During the event, Professor Scriven presented Mr Munchau with the iCES Distinguished Visiting Fellow certificate Award which recognises outstanding achievements in the spheres of business and finance.
A crisis of global finance
In his talk, delivered to an audience of over 80 staff and students, Mr Munchau examined German, French and other European perspectives on the crisis, in particular the relationship between the crisis and the allocation of markets in Europe.
Understanding Global Trade
Mr Munchau argued that the crisis is clearly a crisis of global finance, and that, more specifically, it is a crisis of global trade. He argued that the collapse in global trade is what is not fully understood in current analysis of how the Eurozone will be affected by the financial crisis.
Comparing the industrial production in Europe and the latest IMF forecasts of global growth, Munchau argued that the tensions within Europe need to be examined in the light of the divergence in the types of competitiveness among European economies.
Mr Munchau speculated on the possibility of an unlikely break up of the Eurozone suggesting that it is not the case that the departure of either a weak or strong member will be a defining factor of the break up. However, he argued, a possible scenario may include a combination of external and internal 'shocks' that would see an 'unbearable rise in protectionism invalidating the rationale for EMU'. This, he suggested, could be tackled by the member states reassessing fiscal union.
Reducing the European dependency on exports
In his conclusion, Mr Munchau pointed out the way in which the crisis had been underestimated so far affecting, in particular, European nations that based their finances on trade exports. During a focussed Q & A session Mr Munchau further concluded that the crisis will continue with the possibility of stabilisation within a year. However, for Europe, such a stabilisation would have to be based on a decrease of the financial sector, an increase in economic co-ordination, a reduction of dependency on exports, and a reassessment of trade.
The President of the Student union concluded the event by giving a vote of thanks to Mr Munchau, emphasising that the event had given students a deeper and more contextualised understanding of the impact of the crisis for Europe and for globalised relationships between European nations. The lecture was followed by a wine reception where students had the chance to speak directly with Mr Munchau.
Mr Wolfgang Munchau, newly appointed iCES Distinguished
Visiting Fellow talks to Regent's College Students
Tuesday 17th of February 2009
Institute of Contemporary European Studies (iCES)
European Business School London