George Soros: EU in 'mortal danger' following Brexit
The EU is in "mortal danger" and faces an "existential threat" following Britain’s decision to leave the EU, investor George Soros told Parliament on Thursday.
George Soros | Photo credit: Press Association
He also warned of a looming financial crisis that he believes will be comparable to that of 2008.
"This has been unfolding in slow motion, but Brexit will accelerate it. It is likely to reinforce the deflationary trends that were already prevalent," the billionaire said.
Soros warned before the referendum that the pound may slump more than 20 per cent against the dollar if Britain voted to leave. Britain’s currency plunged to the lowest in 31 years after the result.
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The Eurozone, he said, will have to contend with an impending slowdown, adding, "The orthodoxy of German policymakers stands in the way of the only effective response: having a Eurozone budget that could adopt counter-cyclical policies."
Soros told a packed meeting that the Europe’s "enemies" would also be "emboldened" by current events afflicting the EU.
Last Thursday’s vote to leave the EU was, he believes, the "starkest example yet" of the consequences of "failing" to manage the migrant crisis.
Leave campaigners put immigration to the top of their agenda during the referendum campaign, with many people voting to leave and saying that the issue was their main concern.
There has been a spate of racist incidents in the UK since the result.
Soros condemned the "anti-immigrant rhetoric" that had "fuelled" the Brexit result, which now threatened to leave refugees and migrants being "marginalised and ostracised."
Despite the problems it faces, he said that "allowing the EU to disintegrate" would be the "height of irresponsibility."
Soros, who created the Open Society foundations, was in Parliament to participate in a debate on the budgetary implications of the current refugee and migration crisis.
Soros, who rose to fame as the money manager who broke the Bank of England in 1992 with a wager that the UK would be forced to devalue the pound and pull it from the European exchange rate mechanism, was particularly scathing of the EU’s response to the migrant crisis, saying it was "riddled with flaws."
"Angela Merkel showed great moral leadership in the opening the door to refugees but, unfortunately, this was not welcomed and public opinion turned against her.
"Greece, as a result, has been turned into a de facto holding camp with totally inadequate facilities for refugees. The situation is increasingly deteriorating and ember states are unwilling to cooperate with each other and instead follow discordant policies."
Soros also called for radical reform of the EU budget, saying that funding for cohesion funds, which account for 32 per cent of total spending, and agriculture (38 per cent) had to be "sharply reduced" in the next spending cycle.
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