There we have it. After a marathon session in Brussels last night there is a \u201cdeal\u201d that is supposed to keep Greece in the Eurozone and set the country onto a path of sustainable economic recovery. You might well question the nature of this \u201cdeal\u201d given that it turns a sovereign country effectively into a protectorate as at least one of the Eurozone leaders \u2013 Robert Fico \u2013 apparently admitted (see @JakubPotocka).<\/p>\n\n\n\n
Make no mistake: the handling of the Greek crisis has fundamentally changed the European Union. This is not a situation in which we can just go back to business as usual \u2013 there has been way too much bad blood for this. So what are the consequences of the Greek \u201cdeal\u201d? Here are my first thoughts:<\/p>\n\n\n\n
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A senior official in the room believed that Germany was now the country that appeared to be acting in bad faith \u2014 no longer the Greek prime minister Alexis Tsipras. At one point, Mr Tsipras had to endure a lecture from the Slovenian prime minister, to which Italian prime minister Matteo Renzi objected.<\/p>\n\n\n\n
Eventually, Fran\u00e7ois Hollande, the French president who has battled to keep Greece in the fold, ushered Ms Merkel and Mr Tsipras into Mr Tusk\u2019s office to finalise a compromise on the privatisation fund. Although they were ultimately successful, the negotiations appeared to strain the Franco-German relationship long at the heart of the European project.<\/p>\n\n\n\n
We will now see whether the ECB gives more breathing space to the Greek banking system and how national parliaments in Greece and elsewhere react to the new developments. This \u201cdeal\u201d has taken fears of Grexit away in the short-run but you shouldn\u2019t think that this solves the problem. When it comes to Greece there are too many questions (debt restructuring, \u2026) that remain unanswered and the general direction is continuation down the wrong path. But yesterday\u2019s events have also revealed a whole set of wider issues in the Eurozone that will be very difficult to address (especially the lack of democracy). Stay tuned for more trouble\u2026<\/p>\n\n\n\n