Debt crisis continues in Europe owing to turmoil in Greece, Italy

There seems no end to political chaos in Greece and now even in Italy, which lingers over the fate of euro’s health. Italy faces crisis due to high-rise in its debt rates. Markets stay unstable due to political chaos in Italy and Greece and more negative traits are looming over the fate of European Union that will ultimately affect the entire global market too.

Greeks are looking forward to form a new transitional government. In Italy, the political chaos emerged with possibilities of Prime Minister Silvio Berlusconi losing power. This has put investors in doubt over the future market trends  as new democratic governments are likely to make changes unfavorable to investors and so they are pulling back their money leading to more financial turmoil.

Interest rates for Italy’s debt have been increased to 6.6 percent reaching its highest so far since the inception of euro. The finance market set itself into fire following the rumors of prime minister’s possible withdrawal from power but he refuted it later.

Greece’s rush to pull itself away from EU to save itself from the depreciating value of euro had ignited a crisis as international leaders severely criticized the decision. The EU threatened to expel Greece and stop providing any aid. This compelled the political parties of the country to make a written commitment and follow European leaders’ demands in order to get the next installment of aid of $11 billion from the EU.

European Union warns Greece against drama over referendum to stay

European Union warns Greece against drama over referendum to stay

Tired of Greek illusion over the decision to withdraw from European Union to avoid damage to Greek currency, the EU threatens to expel.

European leaders—French Prime Minister Nicolas Sarkozy and German Chancellor Merkel told Greek leader that Greece should help EU to stabilize euro instead of withdrawing to save its own national currency. The leaders also warned Greek Prime Minister George Papandreou that if Greece pulls itself from the union, they would stop providing any aid to the country. The meeting between EU leaders and Greek premier was held in in Cannes.

Following this dilemma, France’s biggest bank BNP Paribas also pulled its exposure to Greece, Spain and Italy to safeguard its balance sheet by reducing the total amount by $17 billion.

Greece was expected to receive an additional aid of 8 billion euro from EU in Novemeber.

German Chancellor Merkel stated during a news conference that she desired Greece to stay as a member of EU and help in stabilizing Euro.

Following the warning, Papandreou talked with Greek finance minister by calling emergency Cabinet meeting in Athens to solve the crisis and seek for a midway.

At the same time, Brazil, Russia, India, China and South Africa also gathered to discuss and solve economic crisis in G20 summit that ended recently.

Serbian military officer Mladic likely to face extradition

A judge in Belgrade Serbia has ruled Friday that the former Serbian military officer can be extradited to the world court sitting in Hague to face charges on the atrocities he committed. Ratko Mladic was arraigned before the court. However he has three days to appeal against the ruling.

The arrest and subsequent arraignment of Mladic a former Serbian army general who was accused of being the mastermind of the worst atrocities committed against mankind in Europe since the end of the Second World War was a major breakthtough. He was accused of supervising the massacre of over 8000 Muslims during the Bosnia war that lasted between 1992 and 1995.

His capture is a major breakthrough towards allowing the 2 neighboring countries from joining the European Union. It is expected that his arrest and subsequent prosecution will begin the process of healing the old wound and animosities between the two countries.

It was surprised to the world how the former army general was able to evade for more than 15 years after the massacre. The 60 year old general has developed ill health and his son said that his health is failing and called for international medical experts to examine him. With the decision of the judge it is now clear that he would be transferred to The Hague unless he appealed against the decision.