Next week at the latest, the Commission’s emergency plan is expected to prevent the re-opening of the pipeline that transports Russian gas to Europe.
By Chrysostomos Tsoufis
Rarely a regular meeting of Eurogroup is being held under such dramatic circumstances as today’s meeting of the Eurozone Finance Ministers.
By the time the ministers arrive in Brussels, Russia will shuts down the Nordstream 1 pipeline for maintenance and remains doubtful if he will reopen it. The price of natural gas is at a four-month high, the euro is at a 20-year low and the price of oil is falling amid fears of a global recession.
Of course the discussions will revolve around the economic environment. After all, just yesterday that the most likely scenario is that Nordstream it will not reopen while next week at the latest is expected emergency plan of the Commission to deal with exactly this eventuality. The scenario of the closed faucet gives another dimension to the consultations of the Ministers of Finance to determine the fiscal rules next year, a matter of great interest to the Greek government.
The basic scenario, despite the fears, remains that the Eurozone will not be in recession this year or next year. It is, however, worrying that large economies such as Italy and her Germany they will be flirting with technical recession – 2 consecutive negative quarters – while flights of the French economy are also very low.
Despite the fact that the inflation gallops from record to record, the Eurogroup is divided in terms of a European support mechanism for households and businesses, while National support is the highest in the Eurozone in terms of GDP. In this context, the upcoming double increase in interest rates (July and September) announced by the ECB is certain to be of concern. Possibly there will be a “lively” discussion about the new tool that Frankfurt is preparing that will prevent the fragmentation of bond yields. Despite assurances that there will be some kind of flexibility for countries that will reap the benefits of the tool, the Germans have already openly expressed their objections and the concerns their.
THE Christos Staikouras will come to the discussion with the Greek economy showing remarkable endurance since the growth rate this year will certainly be higher than the initial estimates and among the highest in Europe, while with the help of inflation the debt as a percentage of GDP will be at the end of the year at the pre-pandemic level of 180% having recovered all of its losses biennium 2020-2021. Good news also from the execution of the budget which will produce a primary surplus of 1% in 2023.
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