Fragile economics of the eurozone (1)

I read with interest the comments made by our erudite MEP Simon Busuttil regarding the gratitude Malta should show for being part of the European monetary mechanism and having adopted the euro as our national currency, thereby apparently affording us some level of protection from the disasters which have affected the countries out of the Eurozone.

However, while an admirer and supporter of Dr Busuttil I fear his logic is somewhat fundamentally flawed, dare I say myopic, in his submissions and tend to side with the rebuttal and argument put forward against his assertions as provided by Joseph Farrugia (August 5).

Absolutely no reference is made to the financial dire straits of countries within the eurozone that find themselves entangled in severe difficulties and whose precarious and massive balance of trade deficits are attributed to possessing the euro as their trading currency. Italy and Spain are two of the more obvious examples that spring to mind in this dilemma, both countries' economies, and respective tourist industries, having been immensely damaged by trading with the euro as their bargaining tool.

It has been successfully argued that the euro has in fact been a bad thing for these economies, by more learned and expert financial advisers than our dear Dr Busuttil who have expounded upon this by actually challenging the perceived wisdom in whether or not the problems caused by migrating to this currency was a good idea. Focusing on this fledgling currency, because in the grand scheme of things that is what the euro is, financial wizards are actually predicting its eventual demise, not imminently but certainly within the next generation, as such a fragile single monetary union is evidently not working. I would argue that the one true viable way forward, and pivotal financial option, is for the EEC to adopt and cultivate a free trade zone.

In conclusion, how does a strong euro benefit our economy? How does it impact on our balance of trade figures or boost tourism prospects? Ultimately, I fear that what will materialise is that present individual eurozone countries will initiate protectionis measures and policies in their respective countries and ditch the euro to safeguard their and their peoples' own interests, or else face the grave potential of financial collapse and ruin. Who can say precisely how the euro will ultimately damage our economy or, with conviction, extol exactly on the long or short term benefits and how much good it has done it thus far? Moreover, can it get worse?