The EU economy has not really recovered since 2008, except for Germany. The latter remains an atypical economy among the other big economies of the EU, but the fact is that since 1958, Germany remains the growth engine of the Single Market.

After two oil shocks and a long inflation period, in the 1980's the EU economies started to converge under the impulse of the Objective 92 policy, which laid the basis of the Economic and Monetary Union. The single currency system worked mostly fine until 2009 and the Greek catastrophe. Since then, more and more drastic measures have been sought to bring together all the EU economies within the eurozone, around a common "austerity" policy to create stable and steady growth and employment.

Chancellor Merkel has been lecturing her colleagues about the virtue to abide by the rules of the Growth and Stability pact, which basically prevents larger budget deficits that would jeopardize "austerity". There are EU countries, using the Euro but are definitely unable to abide by the Pact limits. Greece, Portugal and recently Greek Cyprus are among them. Ireland fares better, but suffers from increasing unemployment. When it comes to three of the biggest economies of the EU, Spain, Italy and France, by size and order, the whole strategy becomes much more delicate.

Manuel Valls and Matteo Renzi, premiers to France and Italy, have been heavily criticizing this "over austerity" policy, invoking that if the budget strictness creates a loss of GDP greater than indebtedness would create; all the system makes virtually no sense. Anyhow France cannot have an "aligned" budget for another two years, until 2017.

Now the problem is the fact that the newly elected President of the European Commission, Jean Claude Juncker, the candidate of Germany, is a much experimented conservative politician, beforehand he was the speaker of eurozone countries. He has the right to oversee national budgets, together with the collegial management of the commission, and issue warnings to member states which are not abiding by the rules. That is not very promising for the economic policies of François Hollande.

There has been another development, which tarnished further the image of austerity policies wanted by Germany: the German economy has been performing well below expectations recently. Growth rates have been revised at much lower ceilings and that is very bad news for the "balanced budget" objective dearly sought by Wolfgang Schäuble, the conservative minister of Finances. Such a "perfect" budget has not been seen in Germany since 1969 and Schäuble's main achievement would have been to implement one.

The embargo on Russia has also adversely affected Chancellor Merkel's previsions. She has been the first Western leader, apart from the Serbs, to hold a bilateral meeting with Vladimir Putin. Germany seems to distance itself from its EU partners more and more, and this is not good news. The EU needs a thorough overhaul, the eurozone should start creating employment, and the present strategy bears the risk of turning the Single Market into a Japanese style deflationist economic zone. Everyone is eyeing Germany, which does not seem to have any "grand strategy" for the time being. It requires perhaps more than spying on Turkey to become a real economic and political power.