European Unity Threatened by Economic Slowdown

Slowdown in Spain is representative of the EU's growing economic ills
By Clay Dillow,  Newser Staff
Posted Aug 12, 2008 11:50 AM CDT
A man works on a new building in construction in Pamplona, Spain. Promoters are giving away a year's worth of mortgage payments, cars, trips and other freebies to lure buyers.   (AP Photo/Alvaro Barrientos)
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(Newser) – Europe seems to be catching the economic malaise that has already affected the US, and the downturn is putting a damper on member nations' enthusiasm for the 15-year-old Economic Union, the Washington Post reports. Revised projections show European economies slowing down as much, if not more, than the US over the next year and a half.

The financial interests of the EU's 27 countries now diverge, as downturns in Spain, Ireland, and Denmark are more like the US than the situation in France and Germany. "The deteriorating economic condition is putting new stress on Europe, which seems to be even weaker now than the US," says a Deutsche Bank economist. "Some pessimists even talk now about the euro area breaking apart. I would not go that far, but we do know the honeymoon is over and this is the first real test of the marriage that we have seen."