Protectionism.....Italian Moneylenders

      European and Southeast Asians reject protectionism. An apparent unity front has been formed by European leaders to reject protectionism, in order to protect their national interest in the face of the continued economic crisis. The summit held in Brussels was called to deal with the differences over how to deal with the recession and the fears that some countries ( France and Germany) may take steps to undermine the European committment to a single market, and also to prop up the solidarity between members. There were concerns after the French President stated that the $8 billion bailout to the car industry ( Renault and Citroen etc.), must be spent in France, and the German Chancellor rejected tghe Czech/Polish bailout plan.

      The Hungarian Prime Minister Ferenc Gyurcsany warned of " new Iron Curtain" between the rich West and the poor East, " We should not allow a new 'Iron Curtain' to divide Europe into two parts". The split in the Union is between countries such as France that want strong action to buoy industries, especially carmakers and the poorer Eastern countries, Poland etc, that cannot afford such bailouts. A statement was prepared that declared that " the meeting must ensure that maximum possible use is made of the single market as an engine for recovery to support growth and jobs". The prospects of this happeniong is at best questionable as political pressure mount in individual countries to put its interest first. When it comes to the crunch, France, Germany and Britain( where an election is to be held in a few months), will act in their own short term sel-interest, even though the single market and concerted action is the best for the long-term.

      Meanwhile in Italy, the Mafia has become the moneylender to businesses that are not able to get loans from the banks. From flower sellers to bar owners to restaurants to grocery stores to art dealers, small and medium-size businesses are turning to loan sharks for money, paying exorbitant interest ( as much as 30% a month). " The loan sharks are growing like mushrooms and becoming bolder and more visible", according to Cardinal Severino Poletto, the archbishop of Turin. The national shopkeepers association, Confesercenti, estimate that 180,000 businesses have turned to the loan sharks in desperation, and Nino Micelli, an adviser to the Confesercenti has stated that  the Mafia's goal is to take over the struggling businesses, especially when the loans are not repaid and violence is threatened and/or used and restaurants, grocery stores and bars become property of the criminal gangs. Many experts say that organised crime is already Italy's biggest business and the untaxed underground economy is growing larger and larger. The Mafia seem to be providing the same kind of financial assistance that was so useful for Italy after the end of WW11.

      South-east Asian countries at their ASEAN meeting in Thailand, endorsed fiscal stimulus, monetary easing, access to credit and trade financing and other measures to stimulate domestic demand. A statement also called for " bold and urgent reform" of the international financial system. This group, which is consensus- based, has long been dismissed as nothing more than a talking forum, for leaders to make speeches full of promises and nothing else. However the continued world economic problems has focused attention on the need to act concertedly, as no single country ( even the U.S.A.) can go it alone. ASEAN, has also announced that a road map will be implemented, with the objective of creating a single economic community  in six years. This will ( if successful), bring together 570 million people with  a combined GDP of over $2 trillion.