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Prodi's prescription for euro zone's woes

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Prodi's prescription for euro zone's woes

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Italy’s former premier Romano Prodi spoke to euronews about the financial turmoil facing the euro zone, and his homeland in particular. Prodi, an ex-president of the European Commission, was speaking in Bologna.

Simona Volta, euronews:

“First of all, let’s start with the crisis that does not seem to be letting up in the euro zone. The European Central Bank is still talking about this possibly spreading from Greece, Ireland and other European countries, among them Italy. Do you think this is the beginning of the end of the euro?”

Romano Prodi:

“Absolutely not, because it is in no-one’s interest that the euro disappears, least of all the Germans.”

euronews:

“You say Germany has no interest in the euro disappearing. What do you mean by that?”

Romano Prodi:

“Since we have had the euro, Germany has generated an asset with its spectacular economic balance. So Germany can build a long-term economic programme without the obstacles it had before. The Germans know very well that no euros would be a real disaster for them.”

euronews:

“Were you to criticise Europe for anything, what would it be?”

Romano Prodi:

“It is still the same criticism: a lack of unity, the fact that history demands a Europe, strong and united. We have macro-economic data infinitely better that the Americans. The Americans are not under attack. We are. And why?… because we are divided.”

euronews:

“The US rating agencies bring a lot to bear on the European situation… the same agencies, we remember, that failed to raise the alarm in 2008 about the state of Lehman Brothers and others, and now they are calmly downgrading the economies of European countries. What can be done to limit their impact on the markets and what do you think of Chancellor Angela Merkel’s idea of creating a European ratings agency?”

Romano Prodi:

“I would like to see more competition among ratings agencies, so if a European ratings agency was created it would be much better. It could not be an official agency because it would lose its authority but if an agency were created to evaluate Europe, be it European, Chinese, Indian, it would be much better because the American agencies have the power of make-or-break according to political interests or simply political sentiments.”

euronews:

“The eyes of Brussels are fixed on Italy. But do you think the financial measures prepared by Berlusconi’s government to balance the budget by 2014 seem a realistic objective?”

Romano Prodi:

“The goal is possible. But I would have started with greater coherence already this year. To transfer the toughest measures to 2013-2014, which is still possible, is certainly no proof of political intelligence and that won’t reassure the international markets.”

Romano Prodi:

“But will the plan be enough to kick start the country’s economy?”

euronews:

“Development could not be relaunched rapidly if there were not structural reforms as part of the financial plan. This plan means the firemen have put out the fire. To rebuild the house you need time, but I also hope there will be more strength in Italian politics.”