It is a referendum with many question marks: If this Sunday vote by the Greeks about their future, is not the issue really clear, nor are the possible consequences of the election for Greece and the euro zone. Given the scope of the decision, the population is of two minds – a clear tendency for one of the two options is not clear
And because the Greeks are in good company:. Even internationally renowned economists disagree, given the confusing situation, what should best be done in the Causa Greece. A survey of the “Welt am Sonntag” among leading economists found that half of respondents holding an exit of the country from the euro in view of the circumstances for the best solution. The other half pleaded to remain. Only then, they argue, can the country get back on its feet.
Ironically, membership of the euro, which was once intended as a coronation of the integration of an entire continent, thus becomes the vital question not only a nation, but the entire currency area. The victory will carry either the political will or the economic rationale: Because regardless of how this weekend goes in Greece, the result will set the course for the way ahead in Europe. Ensure that the operations in Athens radiate far beyond Greece. And they are also crucial for investors, companies and savers across Europe.
In the mood of the economists can thereby identify a clear dividing line. In particular, those economists who are well known for a regulatory point of view to see, in one of Greece whereabouts little sense and speak clearly for a Grexit, that the resignation of the country from the euro bond, from. “As long as Greece is in the euro zone, there will be considerable tension. Political conflict and economic problems have been programmed,” says Kai Konrad, director of the Munich-based Max Planck Institute. “The Greek economy could develop much better if the country were not in the euro area.” The member of the Scientific Advisory Board of the Federal Ministry of Finance stands out above all the fact that Greece for emergency release could act responsible again. “In recent years, the negotiations to loans and transfers have dominated politics in Greece. After leaving the country could once again concentrate on providing the foundations for an economic recovery.”
Another advantage of Grexit sees Jörg Krämer, chief economist at Commerzbank: “Then the Greeks were largely identified and forced to bring their house in order on its own.”
For Clemens Fuest, president of the Mannheim Centre for European Economic Research (ZEW), requires membership in the euro, a country that complies with basic rules. “With the current government and the existing institutional deficits Greece is better off outside the euro zone. If institutions and policy change, the country can return,” he says.
For this course, would require conditions, at least at present does not have the Greece. Still, that is decisive for the question whether it is possible to bring on a euro exit economically regain strength Greece or to plunge in the worst case to destruction.
” A wise and simultaneously strong government could try to take advantage of the departure from the euro to to put Greece back on its feet. However, when Athens the temptation can not resist to increase the pensions and hire more public servants to the to fight extremely high unemployment and growing poverty of the population – then the risk is great that the exit from the euro in hyperinflation ends “, the economy Peter Bofinger outlined the problem
The US currency expert Barry Eichengreen of the University of Berkeley in California sees many question marks in the case of a Grexit. “A farewell of Greece from the monetary union would make the country a test of endurance and trigger an even more shrinking economy and inflation,” he warns. “The chaos would still exist for a very long time, probably for years.” Even the euro zone came to not inconsiderable risks. “A Grexit would weaken the cohesion of the monetary union and make it even more vulnerable to future crises. The next time, when a country suffers an economic shock, investors are likely to look for much faster than before the emergency.”
becomes even clearer Marcel Fratzscher, President of the German Institute for Economic Research (DIW) and former ECB economist:” The euro is not Greece’s problem The two biggest problems of Greece are the bad state institutions and outdated. economic structure. This will not be eliminated by a new currency, but even more difficult to solve. ” In his view, would the Grexit even lead to an even deeper humanitarian crisis. And also for Germany and Europe is the Grexit the worst possible option, as in this case, much less repaid loans and thus higher costs would still come to the German taxpayer. Fratzscher therefore warns against repeating the mistakes of the Lehman bankruptcy in September 2008, playing down the risk of contagion. “We all – Greek, German, all Europeans – will greatly benefit from the common currency.”
Even Dennis Snower, president of Kiel Institute for the World Economy (IfW) can see no advantage in a Grexit. So the consequences of a euro exit for fiscal policy and the security policy in Europe are incalculable. “Being part of a stable monetary system is in the short term a burden, but in the long term a basis for the return of confidence and investment into the country.” The introduction of whatsoever “weak currency”, however, is not a recipe for success and the worst possible outcome for all parties. “Uncontrolled slip off from the euro would hit the Greek economy and thus many citizens of the country hard. For creditors, this would also be associated with the highest losses,” says Snower.
However, many of the experts also point out that the economic consequences of a Grexits for the rest of the euro zone would be quite low. Contagion effects on other levels could give it yet: “Politically, it would certainly be a disadvantage, since the stability and unity of Europe could be at risk,” says about Stefan Biel Meier, chief economist at DZ Bank
Other economists expect, however, a withdrawal of Greece from the euro could even be to the advantage of the crisis-ridden monetary union. “The marathon negotiations has poisoned the political climate in Europe and pushed to its limits. The permanent distribution conflicts would only come to an end,” says financial expert Konrad. “The Grexit would also be a clear signal for the remaining members: Who is betting that the euro zone to a transfer union is carrying at the end of the consequences.”
According to exactly should watch in the coming days, as the outcome of the referendum affects the markets savers. Depending on which side prevails, are also provided for Europe decisive course. Should Europe and Athens by wrestling at the last minute to find a political solution, this is likely the only postpone problems again. Europe would then probably continue to stumble from crisis to crisis and remain in distribution struggles. Otherwise it could look like when the Greeks drama ends with a clear cut. Then, however, investors would have to adjust to high market volatility. At the same time the ECB is expected to then probably extend their multi-billion bond purchase program indefinitely. The struggle between political will and economic ratio in Europe will therefore continue to accompany us.
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