Consequences of French weakness

A "TEMPORARY" Greek exit from economic and monetary union, proposed by Germany, supported by many German-leaning euro members, yet hotly opposed by France and Italy, was narrowly averted in the marathon negotiations that ended on July 13. But the suggestion may still eventually decide Greece's fate in monetary union. The divergence between the two countries demonstrates new fragility in Franco-German relations that looks likely to mark European cooperation for years to come.

Wolfgang Schäuble, the German finance minister, whose hard line on Greece ended up determining Chancellor Angela Merkel's negotiating stance, has made clear in the week since the ill-tempered European summit on Greece that he still favours a Greek exit from the euro.

Whereas it once would have feared European isolation, Germany now puts forward views opposed by France with demonstrative self-confidence. This reflects not only manifest German economic strength, but also EMU (Economic and Monetary Union) membership of several smaller nations from Central and Eastern Europe that take an even more robust attitude than Germany on the Greek economy.