Sarah Hewin on the German Bailout Vote

09:45 Thursday 29th September 2011
BBC News 24

SIMON JACK: We can talk to Sarah Hewin now. She’s Head of Global Research at Standard Chartered. What do you expect to happen Sarah?
SARAH HEWIN: Well we think that the vote will go through. The question is how far Angela Merkel has to rely on the opposition to get this ratification of the EU, the new powers of the EU bailout facility. There’s been some opposition amongst her own coalition partners, and if she does end up having to rely on support from the opposition to get this motion passed, it’s going to reflect very badly on her. It could really undermine her position in the run-up to the general election. That’s not going to take place for another eighteen months or so, but nevertheless it’s still something which could undermine her political authority.
SIMON JACK: Is she faced with a rather Hobson’s Choice of save the Euro and lose her job? Is that what she’s looking at?
SARAH HEWIN: Well, all along her position has been one of trying to save the Euro, but also trying to make sure that her coalition is not acting in direct contravention of what the German public want. So it’s really steering a very careful path between those two. The Euro needs Germany to survive, and the Euro bailout programme needs Germany’s backing. So that’s going to continue to be the case. At the same time, she has to be very careful about what policies she makes. So if she goes too far, then that is going to reflect very badly in those elections in 2013.
SIMON JACK: Alright Sarah. Thanks very much indeed. Sarah Hewin Standard Chartered.