Eurozone Crisis and Its Impact on the European Integration Project Essay Example
2. What effect does the “Euro zone crisis” have on the European integration project? Discuss.
The European integration project is a political-economic partnership amongst 27 countries, located primarily in Europe, operating through a hybrid system, forming what is called today the European Union (EU). According to Johnson and Turner (2006), the main purpose of the Project is economic integration, based upon free movement of goods, labour, services and capital throughout state members, thus formation of a customs union, free trade area, a single market leading to an economic and monetary union.
The global financial crisis had a significant adverse impact on the EU economy, affecting some members more than others and triggering the so called Euro zone crisis. The discrepancies between member states within the EU, the obligations and risks involved in integration, especially regarding monetary unification and lack of confidence by investors are putting at risk the stability of the unification process. This essay aims to first briefly explain what the Eurozone crisis is and then discuss the impact of the Eurozone crisis on the European integration project focusing on four aspects: (1), the political dimension, whereby Eurozone members are shifting to a deeper integration seeking unified political governance. (2), the monetary dimension, including the crisis’s impact on the role of the European Central Bank. (3), the fiscal dimension, focusing on the credibility of the Stability and Growth Pact since the Eurozone crisis has erupted and finally, (4) the external relation’s dimension, the crisis’s effect on the perception of the EMU and the EU as frameworks for monetary and regional integration respectively.
EUROZONE CRISIS
The Eurozone sovereignty debt crisis developed from late 2009, due lack of investment confidence on some European states, including Portugal, Italy, Ireland, Greece and Spain or “PIIGS”. Since joining the EMU, those countries have received
The European integration project is a political-economic partnership amongst 27 countries, located primarily in Europe, operating through a hybrid system, forming what is called today the European Union (EU). According to Johnson and Turner (2006), the main purpose of the Project is economic integration, based upon free movement of goods, labour, services and capital throughout state members, thus formation of a customs union, free trade area, a single market leading to an economic and monetary union.
The global financial crisis had a significant adverse impact on the EU economy, affecting some members more than others and triggering the so called Euro zone crisis. The discrepancies between member states within the EU, the obligations and risks involved in integration, especially regarding monetary unification and lack of confidence by investors are putting at risk the stability of the unification process. This essay aims to first briefly explain what the Eurozone crisis is and then discuss the impact of the Eurozone crisis on the European integration project focusing on four aspects: (1), the political dimension, whereby Eurozone members are shifting to a deeper integration seeking unified political governance. (2), the monetary dimension, including the crisis’s impact on the role of the European Central Bank. (3), the fiscal dimension, focusing on the credibility of the Stability and Growth Pact since the Eurozone crisis has erupted and finally, (4) the external relation’s dimension, the crisis’s effect on the perception of the EMU and the EU as frameworks for monetary and regional integration respectively.
EUROZONE CRISIS
The Eurozone sovereignty debt crisis developed from late 2009, due lack of investment confidence on some European states, including Portugal, Italy, Ireland, Greece and Spain or “PIIGS”. Since joining the EMU, those countries have received