The European debt crisis: Is maybe time for a Maastricht Treaty II?

This blog is not political but exceptionally I write a comment on issues outside the scope of the blog when these issues are of great importance. The current European Union debt crisis is such an issue indeed.
I watched the other days a TV interview of the old Dutch politician and ex-EU commissioner Frits Bolkestein. Bolkestein argues that the solution to the Greek debt crisis will be that Greece should voluntary withdraw from the Euro zone, go back to the drachma as a national currency and solve its debt problems itself. Bolkestein recognizes that there is no mechanism provided in the EU for such a step, so a country who will do that must take the initiative itself. He also said in the interview that the entry of Greece in the Euro zone was the result of a compromise despite the fact that Greece did not need at that time the Maastricht treaty criteria; according to Bolkestein neither Italy met the criteria at that time but since Italy was allowed in the Euro zone Greece was not possible to be refused.
Bolkestein is in line with other politicians and ex-politicians in Europe, mostly from the ultra- right side of the political spectrum, who have made similar suggestions in the past. These views are however not shared by most mainstream politicians and the financial world due to the fact that that such an act will create a precedent that could lead in the end to the Euro zone and maybe of the union itself. What is true in his argumentys is that the EU does not have any mechanisms in place to deal with such situations and that  Greece seems not to be able to meet the targets set by the EU and the IMF / WB with regard to increase of public revenue and decrease expenditure in combination with a rigorous privatization program. However this is something one should normally expect considering the fact that Greece is at this moment in the middle of a worsening recession, with unemployment in levels unknown before and dealing with the effects of the global financial crisis that started back in 2008. Dealing with the rampant tax evasion, making the Greek economy more competitive by opening the “closed” professions and trying to privatize public organizations are on the other hand are time consuming issues that face also a lot of resistance: from corrupted officials and public servants who profit from corrupted practices, from a disillusioned and not well informed public and also from employees of privatization candidates semi-public organizations who will lose some of their privileges, life-long employment being the most important one.

With the crisis sentiment now expanding to Spain and Italy (look to the financial market results of today 5 September) the suspicion that Greece was just a test case of speculators many are wondering how this crisis will be managed. It seems that the European Monetary System suffers from a structural weakness that in the time of the 1992 Maastricht Treaty that set the foundation of the Euro was overlooked. This is a mechanism that guarantees that the Euro zone countries meet the treaty criteria without exceptions all the time and also lacks a mechanism that in case of serious disruptions like the ones we face at the moment with Greece and possibly with more countries would interfere automatically, i.e. without the political bargaining we see at this moment, and correct the situation swiftly and in a way convincing the markets.

The only way the European Union can deal with the situation today and secure its future is to stop the spasmodic and gutless approaches we see since the Greek crisis begun; this approaches failed to convince anyone, bringing more uncertainty to the financial markets and fuel speculation. I think it is time ( almost 20 years later) to deal with the problem head on with a Maastricht Treaty II.

I wonder however any of the present EU leaders has the guts to put the subject at the table, ignoring the usual voices about a federalist Europe that will surface again putting every time the whole discussion on hold. If the EU is serious about maintaining the Euro as common currency and even prevent itself from falling apart this step is inevitable. A Maastricht Treaty II repairing the flaws of the Maastricht Treaty I will be the only way out of the crisis and the only guarantee that the Euro will survive as the common EU currency. The European politicians must take their responsibilities seriously, stop using the issue for internal consumption and political gains and do their best to correct a mistake their counterparts did back in 1991: creating a monetary union without controlling and support mechanisms that would prevent a crisis like the one we experience at the moment.

2008: 12% of EU turnover online

Forecasts made some years ago about the growth of E-Commerce (by Forrester if I remember well) were estimating that in 2010 10% of the business would be realized online. It seems that such predictions were rather pessimistic: according to a Eurostat press release published on Jan 19, 2010 E-Commerce in the EU accounted in 2008 already for 12% of enterprises' turnover. According to the same report 93% of the European enterprises have access to the Internet (champions were Finland (100%), Denmark, Austria and Slovakia (all 98%) and Germany (97%) and 82% have also access to fixed broadband connection with the highest percentages in Finland (94%), Spain and Malta (both 93%) and France (92%). As to the E-Commerce turnover by destination the largest percentage in the EU is done within the country (73% average); 19% is realized with other EU countries and 8% outside the EU. I expect in 2010 that EU E-Commerce will exceed 15% of the total turnover in the union.


Conclusions: E-Commerce has become mainstream business activity in the EU but more effort must be done to reach international markets. In the global Internet marketplace the potential is enormous. The summary of the report is available in
 http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/4-19012010-BP/EN/4-19012010-BP-EN.PDF

Governments and Social Media

Last week I participated in the DEXA 2008 Conference that took place in the beautiful city of Turin (I recommend it). Next to my track (EC-Web) I followed many of the paper sessions and panels of the E-Government track that I found especially interesting. The reason is that like the corporate world the European public sector begins to explore the possibilities of the Social Media as a new and very promising communication channel with the citizens.
There are already several such projects internationally. I could mention some examples like the New Zeeland Ministry of transport: Road safety forum or the New Zeeland State Services Commission ParticipationNZ wiki , the Government of Canada with the BarCamp a forum for Government employees to get together and talk about what they're doing with social media and new technologies and many other. We must also not forget the impact of the online campaign of Barack Obama in the primaries: using a combination of Web 1.0 and Web 2.0 techniques Sen. Obama managed to spread his message very quickly and effectively and ensured large amounts of campaign money from small donations of online fans.
Following the conference proceedings I was pleased to find out that many initiatives are taking place at the moment in Europe with the support of the EU / European Commission Information Society and Media Directorate – General that also gives the good example with the epractice.eu Social Media portal. In the EU there is already a lot of experience with e-petitions and a number of projects under way in several countries.
This form of Government Marketing is certainly interesting and I see here several parallels with the way corporations are using the web 2.0 domain as marketing tool. Whether the initiatives will be successful in closing the chasm between the citizens and politicians is still too early to tell. The positive thing is that citizens are offered now the possibility to participate actively in pan-European or national forums and express their opinion and ideas. Since the (online) citizen is per definition willing to contribute to anything that has to do with online community and participation the success of these experiments will depend on the listening side. Let’s wait and see.