Italy's Monti: euro crisis risks reviving European instability

Feb 4, 2012, 15:02 GMT

Munich - Europe has found itself at more risk of instability by sharing a common currency, said Italian Prime Minister Mario Monti at the Munich Security Conference on Saturday.

'There are also insecurities ... within Europe due to that wonderful construction which is the euro,' he said during a panel discussion on the financial crisis and international security.

Many of the tensions originate from countries that require bailouts, chafing against requirements they say have been piled upon them, he said. At the same time, many taxpayers in lending countries feel the recipients of aid are being ungrateful.

'The crowning of European integration, the euro, has indeed, because of the eurozone crisis, brought back into the European picture misperceptions and prejudices, the north vs south, the big vs small countries.

'We certainly do not need to have in Europe phantoms of the past coming up again. That is why it's important to have a positive view,' the Italian premier said.

He bemoaned the challenges of austerity, which is being pushed by many European leaders as a hurdle that must be cleared to restore faith in the continent's economies

'We have to go down the tough path of austerity. But we must do it in ways that at least give a reasonable promise of a bright future.'

He said that more financially stable countries like France and Germany had to accept the fact that their own bending of eurozone budget rules a decade ago gave other countries the wiggle room to bend the rules themselves, leading to the current debt crisis.