CURRENCY WARFARE AS PRACTICE OF THE EUROZONE’S EFFILOCHEMENT: THE LOGIC OF GEO–ECONOMY IN LIEU OF THE EUROPEAN INTEGRATION THEORIES

Since the Eurozone’s Effilochement has become a fact and European integration theories, as defined in existing theories, falls short of offering a hope for the salvation of EU’s monetary integrity, the logic of geo-economy is prevailing among the European states. In particular, it means that the Eurozone has introduced currency warfare against the currencies of EU states that do not use the euro. The argument is that a paradigm shift away from solidarity towards quite narrow-minded policy has occurred; different from what has been understood by European integration thus far. This paper outlines a two - level geo-economic approach to analyse how and why the current Eurozone’s Effilochement - structural and political - are solved by means of currency wars. On a theoretical level, the paper argues that such behaviour systematically undermines the status of the euro as a currency of public trust and reframes the economic benefits and international importance of the EU. The empirical tier of the work shows that the euro is perceived as a differentiation tool to impede the tempo of the real enlargement process of the EU that began in 2004. The Eurozone’s efforts to adopt its exclusive institutional and governance structure despite the potential risks involved, provide all the elements of this demonstration. The conclusion leads to the thesis that we need to be think more about geo-economics, this specific example being currency wars, to discern whether this paradigm of IPE became either a hindrance or a vehicle of the European integration ‘game’.