Is the Euro the Biggest Threat to the Global Trading System?
July 17, 2019
By Robert Swift
Delft Partners is pleased to provide a link through to an excellent article on why it’s not just China that should be in the spotlight for unfair trade. This is written by an old friend Stewart Paterson now a research fellow at the Hinrich Foundation which prudently believes in the economic and social benefits of global trade and in the value of sustainable trade for creating positive engagement between nations.
At a time of borderline lunatic monetary policy which has produced little in the way of sustainable growth, it is about time someone spent some money – we need a fiscal contribution to raise productivity and reduce imbalances. The responsibility for that rests not only with the Asian surplus nations, but also Germany which has quietly amassed a Net Foreign assets position of over 60% of GDP in under 20 years, through running persistent current account surpluses and refusing to recycle them productively. These surpluses are not due solely to the desirability and export revenues of the new range of illegally emitting VWs, but more due to the mercantilist nature of German economic policy.
Without a change it is very likely that the Euro and EU will face more ‘populism’ and hopefully an economic crisis which causes a complete re-think. However more populism and an economic crisis are not desirable. We need a change and maybe this article will provide the prod? We changed our name to Delft Partners during a strategic meeting at which we investigated the social and economic history of the town. It was the centre of European innovation in engineering (including wind power), science, fine arts, open trade and economic engagement, especially with Asia.
Such a combination raised living standards very rapidly during what became known as the Dutch Golden Age. So we firmly believe in what Stewart and the Hinrich Foundation are saying.