No change at the top
In the October economic update video for eZonomics, Brzeski acknowledges there was speculation before the German elections last month over a possible change to the strategic handling of the Eurozone crisis. With Merkel strongly reinstated, “these fears have proved unnecessary”.
No big bang
Brzeski says that the task of finding a new coalition partner will be time consuming for Merkel. But the “underlying stance will not change”.
“It will be a continuation of the famous muddling-through towards a stronger and more integrated monetary union, rather than a big bang quantum leap.”
Europe must wait, but it should be worth it
It could be the end of the year before the new German government is in office. So, says Brzeski, pressing issues such as a third rescue package for Greece, a second package for Portugal and more financial burden sharing towards a fully-functioning banking union could remain unsolved for a while.
“But it should be worth the wait,” he says.