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Wednesday 6 December 2023 Dublin: 4°C
Eurozone crisis

Eurozone debt crisis: 9 key diary dates this month

Will this be the most important month for the 17 nations of the euro area?

LAST YEAR, NOVEMBER was the crucial month for Ireland with the arrival of the so-called Troika and the subsequent bailout package and harsh budgets.

October could prove to be an equally important four-week period in the history of the Eurozone with both G20 and European Council meetings planned.

With the markets still in turmoil, a Greek default almost an inevitability and more European banking recapitalisations on the horizon, here is a list of key dates to mark in your diary this month:

1. Sunday, October 9: French president Nicolas Sarkozy and German Chancellor Angela Merkel – who are starting to act more and more like the symbolic mother and father of the euro area babies (or peripheral economies) – are to meet tomorrow afternoon to prepare for an EU leaders conference later in the month.

Usually the pair agree on a united front on the main issues – such as the Greek bailout payments and banking recapitalisation – heading into important meetings with the rest of the Eurozone’s leaders.

2. Monday, October 10: After delaying an earlier vote, Malta will decide on whether to ratify the European Financial Stability Fund (EFSF) on Monday. The minnow country and Slovakia are the last two euro area nations to agree to the expansion of the rescue fund.

Every single country in the 17-nation-strong zone must ratify the agreement, which will allow for more bond-buying, bank recapitalisation and further sovereign bailouts, if necessary.

3. Tuesday, October 12: Slovakia votes on the EFSF. Today, the Financial Times reports that the junior party in the country’s coalition is insisting on certain conditions for its support in the vote. One such condition would be an opt-out of the permanent European Stability Mechanism (ESM). Prime Minister Iveta Radicova rejected this demand from the Freedom and Solidarity party.

4. Friday, October 14 and Saturday, October 15: The Group of 20 finance minister will convene in Paris for two days. A lot of pressure has already been piled on Eurozone leaders ahead of this meeting. Last month, managing director of the Christine Lagarde said governments need to “act together” and “act quickly” to get the global economy back on the path to recovery.

From Washington, US Treasury Secretary Timothy Geithner told European leaders to send a “decisive signal” that they have a strategy for tackling the debt crisis

5. Monday, October 17 and Tuesday, October 18: When this meeting was planned, Eurozone leaders hoped that every country would have given the green light to the EFSF so they could discuss its implementation. This will more-than-likely happen unless something unexpected goes down in Malta and Slovakia over the next three days.

The idea of recapitalising some of Europe’s weaker banks to sure up the shaky system will also be discussed.

6. Wednesday, October 19: Greek trade unions have said that they are planning a “massive” general strike on October 19 to protest against continued austerity measures in the country. The decision to hold regular walk-outs has come on the back of new property taxes and the suspension of a further 30,000 public sector workers.

The last strike, on Wednesday, turned violent in parts of Athens.

7. Thursday, October 20: The European Central Bank’s Governing Council will meet in Brussels. It will be Jean-Claude Trichet’s last meeting before handing the reigns over the Italian central Banker Mario Draghi.

8. Friday, October 21: D-DAY for Greece as about €2 billion in its treasury bills mature. We will (should?) know by then if the EFSF has been ratified and whether there will be a default – orderly or not.

9. Tuesday, November 1: Draghi, or Super Mario as he is known in Italy, takes over from Jean-Claude Trichet at the ECB. Earlier this week, Trichet said there had never been “calm waters” in the euro area in his time in office. Will Draghi’s term be the same?

Some analysts believe that he will be more proactive than Trichet in getting to grips with the debt crisis and sluggish economic growth across Europe.

His first policy decision will be made at a Governing Council meeting on November 3. Rumours are already circulating that there may be a cut in interest rates – something that Irish mortgage holders would welcome.

-Additional reporting by Simone Foxman at Business Insider>

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