An analyst says the European Union members will not reach an agreement on the bloc’s next seven-year budget, paving the way for its breakup, Press TV reports.
“…When we’re moving into a triple dip recession all around, when top of the agenda for most of the countries is austerity measures, budget cuts and trying to pay off the national debt, the likely of getting people to agree to a trillion stimulus for the European Union is highly unlikely,” said Simon Dixon, the CEO of Bank to the Future.com.
German Chancellor Angela Merkel said on Saturday that she was not sure “whether the talks will succeed,” urging EU members to work together to reach a deal as the bloc’s 27 states remain divided on the one-trillion-euro 2014-2020 budget.
Dixon described Merkel’s remarks as “real honesty,” saying that the EU will plunge into a worse economic situation in 2013 and witness its first exits.
“The pressure’s going to get a lot worse as we move into a worse economy in 2013 and more budgets are required to do more banking bailouts as well,” he said.
“I’m forecasting this year that we’re going to see some of the first exists from the European Union which will probably have the domino effect on others.”
EU leaders are expected to meet in Brussels on Thursday and Friday for a second time to reach a deal over the bloc’s next seven-year budget.
The EU leaders first met at a summit last November, but failed to reach an agreement. Most member states reportedly supported an increase in the budget, but countries including Britain, Sweden, and the Netherlands opposed a rise in EU spending.
Europe plunged into financial crisis in early 2008. Insolvency now threatens heavily debt-ridden countries such as Greece, Portugal, Italy, Ireland and Spain.
The worsening debt crisis has forced EU governments to adopt harsh austerity measures and tough economic reforms, which have triggered incidents of social unrest and massive protests in many European countries.