The Eurozone's shelf life: when it expires?

Ljumović, Isidora and Pavlović, Dejana (2013) The Eurozone's shelf life: when it expires? In: Rethinking Europe after the Economic Crisis : lessons for the european core and periphery. Faculty of Economics, Niš, pp. 45-63. ISBN 978-86-6139-084-5

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Abstract

European monetary integration or the Eurozone is the greatest achievement in the history of European integration. There were many crises in the EU, certain problems and disagreements in the Eurozone, internal troubles caused by a lack of respect for rules, but the true sustainability test came with the global credit crunch. The EU’s first response to the crisis was mostly on a national level was not coordinated at union scale and it came quite late. A series of rescue operations started with Greece and continued with Spain, Portugal, Ireland, Italy and most recently with Cyprus. European Monetary Union terms were defined as political compromise, where economic theory that could provide long-term sustainability was neglected. This crisis also showed that Eurozone has turned into two-tier community with the core (first division) and the fringe countries (second division). The Eurozone is considered to be a greatest achievement, but also it turned out to be the weakest link and the biggest threat and danger to the European Union.

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