Press

According to the Centre for European Reform, a pro-EU think tank, around 80 per cent of the EU's foreign policy failures are due to the inability of larger member states to arrive at a common position.... But Charles Grant, the CER's director, says creating a more effective institution to replace the confusing way foreign policy was split between the rotating presidency, the council of ministers and the commission, is overdue.

Charles Grant, director of the Centre for European Reform, complained: "On many of the world's big security problems, the EU is close to irrelevant."

Simon Tilford of the Centre for European Reform in London said the commission plan "assumes that all the imbalances can be addressed by the deficit countries." Germany must play a role too in stimulating its consumption, Mr Tilford said. "Any system of governing the eurozone that ignores the structural problems that we see in the surplus countries is doomed to fail... Nobody wants to weaken any countries' export performance," he said.

"European policymakers are being slow, almost unforgivably slow, in making changes because of the belief that Americans were almost exclusively to blame for the crisis," said Simon Tilford, an economist at the Centre for European Reform in London. But, he said, "they also engaged in similar banking practices — there was a similar property boom here, similar excessive mortgage lending."

"What we have seen, how markets have reacted on Greece, on other countries, and in particular rating agencies, this was done in an irresponsible way, an irresponsible way in the case of Greece," he said at a Centre for European Reform event in London.

Rodrigues's criticisms were echoed by Simon Tilford, chief economist at the London-based Centre for European Reform. "The eurozone economy is not strong enough to cope with the contractionary effects of a generalised budgetary tightening. And if the eurozone falls back into recession, there will be no chance of putting public finances on a sustainable footing." Some countries with high debt or budget deficits – such as Greece, Portugal and Spain, for example – have little option but to cut spending now, Tilford said.

"Joining the euro is a status issue for countries seeking to cement their position at Europe's top table," said Simon Tilford, the chief economist for the Centre for European Reform, a research organisation based in London. "But you also could call it sheer bloody-mindedness of Estonia to join now with the outlook for the currency so uncertain. … Investors will only be willing to lend to Estonia on favourable terms if Estonia can continue to compete … That is where the biggest risks for Estonia now lie."

"There is an obvious logic to this happening at 16," argued Charles Grant, director of the Centre for European Reform. "It's harder to have a discussion at 27 and the contribution of some of those not involved in the eurozone is less relevant. The more often they meet … the more they become like a college and start to understand each other." … Mr Grant highlights the need for labour market reform in southern Europe and for eurozone imbalances to be reduced through an increase in demand in Germany.

"The Greeks have one of the longest life expectancies in the world, yet their average retirement age remains well under 60," says Simon Tilford, who analyses the European economy for the Centre of European Reform. … raising the retirement age is a very good way of dealing with the crisis over public debt. It should convince investors that a government's finances are on the right track, but it won't take cash out of the economy now and jeopardise Europe's fragile recovery.