Austerity Hits Health in Peripheral Europe

Published by City Blaster on Wed, 27/03/2013 - 11:41 in
slow recovery

Daily Market Commentary for March 27: A research study shows that austerity measures applied in peripheral European countries are undermining a long term decline in suicide rates, coupled with outbreaks of some worrying diseases including HIV and malaria. It’s like we have been on war.

The study was the result of an investigation about European health published at The Lancet journal. Even though it is within the mandate of the European Commission to study the impact of all its policies on health, as one of the parties involved in troika bailouts, the European Commission has been more concerned with guaranteeing a return on loans for creditors than on any social impact. Hospitals in Greece are struggling to maintain basic standards, which has resulted in a rise in antibiotic resistant infections and in patients suffering shortages of many medicines needed for their treatment. In Portugal, for example, it has been said hospitals are rationalising expensive cancer treatment medicines and doctors have orders to reduce the number of exams they prescribe patients.

People can’t afford to buy medicines nor to see their doctors,  a situation that poses a severe health risk to the whole society and its past standards of living.

Unfortunately some countries are just losing the “developed” designation in Europe and we are assisting to worrying consequences. Whilst unemployment and growth aren’t at the top of priorities, long-term damage will continue to rise exponentially and the EU incurs in the risk of being broken as peripheral countries don’t see any advantage of belonging to it.

Whilst health is deteriorating in Europe, wealth is also declining in Cyprus. People continue to queue on teller machines to withdraw €100 per day, the current imposed limit, until tomorrow, a day banks are set to reopen. With expected losses of 40% on their deposits, all those with deposits above €100,00 will certainly try to get the remaining, while all other will also try to save their money before the troika sees another hole and decides to tax them too. Capital controls will be applied and will certainly avoid a collapse tomorrow but I still don’t see how banks will get money from savers in the future to lend companies, unless the ECB provides it.

Just two final notes: firstly, I still want to know weather the Cypriot main government officials will be affected by the deposit confiscation; secondly, I want readers to know that Cypriot banks now on rupture have passed the latest stress tests.