It is no longer difficult to predict that the EU is on the road to encounter chaos in the upcoming days. As the ECB president Mario Draghi said this month that a Targeted Long-Term Refinancing Operation (TLTRO) program, which is planned to invigorate the eurozone, can ultimately provide as much as one trillion euros and cheap funds for up to four years. It was thought that these funds would be used in real fields by banks and, thus, the risk of recession in southern European countries would be removed gradually. Following Portugal's Banco Espírito Santo default that came out last week, the question of whether southern European banks could shoulder this burden has become a matter of debate once again. As Germany is against the monetary expansion policies of the ECB and does not find Draghi's latest stimulus very applicable, the German Bundesbank made use of this opportunity.
Actually, the tension between the ECB and Bundesbank is a problem that indicates how the EU will proceed on its way. Bundesbank president Weidmann made a statement which corroborated the perception that the tension between the ECB and Bundesbank will escalate further. Weidmann said the interest rate level that was reached after the ECB amended its policy in June, was very low for Germany. Weidmann stated that a loose monetary policy would be more beneficial for Germany, the largest economy of Europe, and highlighted that the present monetary policy of Germany cost a pretty penny itself. He noted that if they were using their own currency instead of being a part of a currency union, the situation would be much different. He also said that they had to accommodate themselves to the current order as required by the structure of the monetary union. He underlined that a low interest rate policy was an expensive monetary policy, which should not be continued for a long time.
These remarks by Weidmann constitute basic matters of debate for us. If you pay close attention to his statements, Weidmann does not talk about Europe in general, but Germany in particular. This shows us that Germany does not regard the EU as a union, but rather as a Germany-oriented project and a means of consolidating itself.
This situation, along with the standpoint of Germany, is no longer a question that is of particular concern to Germany alone. As long as Germany views the EU from the same perspective, this situation continues to constitute economic and political problems for the entirety of southern Europe, the Balkans and Turkey. This self-centered attitude of Germany, which withstands the ECB-oriented monetary expansion and hampers the fiscal union of the EU, will definitely instigate southern countries. This will not only have economic outcomes, it will also set the stage for more complicated political problems that could evolve into a war in Europe in the near future.
Although the unemployment rate has been falling in the U.S. and Japan, it continues to increase in the EU and in the eurozone in particular. There is only one reason why unemployment climbs to such a great extent in the EU: the distorted and multi-valued pricing of euro. This is largely caused by Germany, which keeps the euro at high levels, and its oppressive policy toward the ECB.
Therefore, it is possible to say that this is in a way a euro crisis and Germany and a market conflict are hiding behind it. This is also the reason why the U.K. has been verbalizing secession from the EU.
The majority of the EU's trade is moving toward developing Asia. However, the highpriced euro and the German crackdown have prevented southern Europe from establishing a market presence in Asia. The EU has to overcome this handicap and expand toward its east in order to set its economy on a sustainable growth path.
One of the characteristic features of this hegemonic transition period is that actors who keep hold of the control mechanisms of the system establish new alliances and endeavor for new regional unions and integration in order to maintain the current structure. At this point, the Transatlantic Trade and Investment Partnership (TTIP), on which the EU and the U.S. are negotiating currently, is a good example for a strategy that concerns Turkey closely.
Nowadays the EU and the U.K. have started to work on how they will minimize their dependency on Russia in terms of commercial transit and energy until 2030. Here, TTIP stands out as a great integration project which will be possible only through middle and southern commercial transits that connect Pacific Asia and Europe. It will pass through Turkish territory and Turkey will make use of this advantageous position.
The EU has to acknowledge that China and Asia have adopted a new path to enhance the quality of exported goods. Last year, EU's imports from China constituted 20 percent of total imports, thus, railway transport has come to the forefront more so than sea transport.
When the middle corridor, which will originate from China and reach Europe passing through Kyrgyzstan, Uzbekistan, Turkmenistan, Caspian Sea, Azerbaijan, Georgia and Turkey, is interlaced with a high-speed railway network, the TTIP will come into effect.
The fact that this network will coincide with the southern road in Turkey and Iran indicates a new period. This big integration is the only way out for Europe, but it is being hampered by Germany.
In recent years, the European Commission has put forward many times in its reports that approximately 90 percent of the world's aggregate demand will be generated outside Europe. Parallel to this, the EU should spread free trade agreements swiftly and open a Pacific corridor. It should prefer to consolidate its relations with Turkey and launch initiatives to end all fields of conflict in the region including the Kurdish and Palestinian questions. It should also develop a certain stance against Israel instead of succumbing to the impositions of Germany.