Message #20333

[Psalm 51:17]

Greece was not ready for euro
27 April 2012
Greece should not have joined the euro, a former head of the German central bank, who was central to eurozone policymaking at the time, has said.

But Ernst Welteke, who was Bundesbank president from 1999-2004, told the BBC that none of the eurozone's problems would be solved if Greece left.
He added there should be greater transfer of wealth from richer parts of the eurozone to poorer parts.
He said he was confident measures were in place to ensure the euro's survival.

"The euro is not in as big a danger as is often recorded," Mr Welteke told Business Daily on the BBC's World Service.
"The euro has been stable [for] 10 years, inside and outside the European Monetary Union (EMU)."

He said that, in hindsight, it was clear that Greece was not ready for the euro.
"We can say that Greece should not have joined the EMU, but that doesn't help."
He said Greece only accounts for 3% of the economic output of the eurozone, so "if Greece leaves the EMU then monetary union will still work."
"But I don't think Greece leaving will solve any problems."
http://www.bbc.co.uk/news/business-17853552