Caught in Crisis by ProQuest

VIEWS: 6 PAGES: 4

More Info
									THEWORLDTODAY.ORG MAY 2009
PAGE 14
                                                     GLOBAL ECONOMIC CRISIS – EASTERN EUROPE
                                                     Seán Hanley, LECTURER IN EAST EUROPEAN POLITICS, SCHOOL OF SLAVONIC AND




                                                   Caught
                                                   ınCrısıs
                                                     Three governments have fallen,
                                                     the new middle classes are feeling
                                                     the pain, there is even fear of the
                                                     emergence of dark forces. Is
                                                     Eastern Europe in for a torrid
                                                     time as the economic crisis bites?
                                                     Can the once magnetic attraction
                                                     of the European Union counteract
                                                     the other factors at work?


              | INDEPENDENT THINKING ON INTERNATIONAL AFFAIRS
                                                                                             THEWORLDTODAY.ORG MAY 2009
                                                                                                                                                                   PAGE 15

EAST EUROPEAN STUDIES, UNIVERSITY COLLEGE LONDON




                                t                HE GLOBAL ECONOMIC CRISIS HAS
                                                   hit central and Eastern Europe
                                                   hard. The drying-up of external
                                                   credit and the decline of west
                                                   European export markets have
                                                   seen economies across the
                                 region contract, leading to rising
                                 unemployment, currency depreciation and
                                 ballooning deficits. The International Monetary
                                 Fund has already agreed bailouts for the most
                                 vulnerable economies of Hungary, Latvia and
                                                                                      packing if Paris engineered the relocation of
                                                                                      Renault’s Slovak car plants to France, provides
                                                                                      an early flavour of such a world.
                                                                                         Indeed, such a Latin American style vicious
                                                                                      circle of social upheaval, populist politics and
                                                                                      stop-go economic policy was precisely the
                                                                                      future many informed observers envisaged for
                                                                                      Eastern Europe in the early 1990s. That this
                                                                                      did not occur then was a result of the region’s
                                                                                      demobilised societies, more developed welfare
                                                                                      systems, and the magnetic attraction of
                                 Ukraine and the region as a whole was targeted       European Union membership. The prospect of
                                 in the support package agreed by the recent          joining the EU anchored the transition process
                                 G20 summit. The position of the new central          in much of the region, serving as both incentive
                                 and East European members has also been              and symbolic focus for painful reforms.
                                 central to European Union (EU) discussions              However, many of the factors that made
                                 about how best to respond to the crisis, given       post-communist transition relatively smooth
                                 the temptation of richer west European states        and uncontested no longer hold. Two decades
           
								
To top