May 16, 2009
The Economist magazine has an elegant and brief summary of the economic and political crisis in Central Europe.
Thanks to a mix of luck and good decisions, the economic apocalypse that loomed over central and eastern Europe seems to have been averted. But dizzy current-account deficits, wild foreign-currency borrowing and reckless fiscal policy are leaving a horrible hangover for some. The IMF forecasts a 4.9% average fall in GDP, with far bigger falls for some. The European Bank for Reconstruction and Development (EBRD) reckons on a 5.2% drop. The downturn is certainly nasty; but some changes have staved off the worst.
I cannot agree less with the political analysis quoted from Ivan Ivan Krastev, a Bulgarian political analyst.
Author : Dániel Antal
…the fear of unemployment will disillusion middle-class voters and stoke protest voting. A bigger problem may be the fear among political elites, some of whom will stick at nothing to stay in power and out of jail. “The model is Berlusconi,” he says glumly.