A top official with China's sovereign wealth fund has issued a blunt warning that the latest unrest across the eurozone shows austerity has stretched the public's tolerance "to breaking point".
Jin Liqun, chair of the supervisory board of the $480bn (£300bn) China Investment Corporation (CIC), warned that undue harshness risked a backlash which could end with necessary economic reforms being abandoned.
Jin has been extremely critical of Europe's handling of the debt crisis, warning that authorities have taken a piecemeal approach and suggesting Greece should be given more time to work off its debt.
But he has previously stressed the need for Europeans to "work a bit harder … work a bit longer" like Chinese citizens, complaining about "sloth-inducing" labour laws.
Speaking at a forum in Beijing on Friday he repeated his warning that governments had spent unsustainably in the past. But he went on to warn that Europe was now seeing social and political unrest across several states.
"One commonality is that unions are now involved in organised protests; demonstrations and strikes. It smacks of the solidarity movement witnessed in the 1930s," he said. "The general public's tolerance of austerity has been stretched to breaking point."
Jin pointed to the unemployment rates in Spain and Greece and added: "The worst case could be a complete discarding of austerity programmes.
The fact the public are taking to the streets and resorting to violence indicates the general public's tolerance has hit its limits."
He went on: "The eurozone needs to strike a proper balance between austerity and growth. Austerity without growth is a cul de sac." Jin also suggested that the European Central Bank should launch further unorthodox measures to help the eurozone, which is now officially in recession.
"Monetary easing is considered too radical but we believe it to be a practical move. The crisis is pulling the economy underwater. "People need breathing space. People should be helped to implement austerity programmes."
Jin told the Guardian after his speech: "European governments should be given some time … If you ask the Greek people to slash their spending by 30-40%, it's not possible. So there should be some tolerance, but the determination to carry on austerity should not be relaxed.
It is only the issue of how you can balance one against the other." CIC is one of the world's biggest sovereign wealth funds and recently bought a 10% stake in Heathrow airport. On Wednesday, Europe saw its biggest ever protests against austerity.
There were general strikes in Spain and Portugal, walkouts in Italy and Greece, and demonstrations in hundreds of cities across the region.
Demonstrators clashed with riot police in Milan, and rubber bullets were fired in Madrid and Barcelona.
guardian.co.uk
Jin Liqun, chair of the supervisory board of the $480bn (£300bn) China Investment Corporation (CIC), warned that undue harshness risked a backlash which could end with necessary economic reforms being abandoned.
Jin has been extremely critical of Europe's handling of the debt crisis, warning that authorities have taken a piecemeal approach and suggesting Greece should be given more time to work off its debt.
But he has previously stressed the need for Europeans to "work a bit harder … work a bit longer" like Chinese citizens, complaining about "sloth-inducing" labour laws.
Speaking at a forum in Beijing on Friday he repeated his warning that governments had spent unsustainably in the past. But he went on to warn that Europe was now seeing social and political unrest across several states.
"One commonality is that unions are now involved in organised protests; demonstrations and strikes. It smacks of the solidarity movement witnessed in the 1930s," he said. "The general public's tolerance of austerity has been stretched to breaking point."
Jin pointed to the unemployment rates in Spain and Greece and added: "The worst case could be a complete discarding of austerity programmes.
The fact the public are taking to the streets and resorting to violence indicates the general public's tolerance has hit its limits."
He went on: "The eurozone needs to strike a proper balance between austerity and growth. Austerity without growth is a cul de sac." Jin also suggested that the European Central Bank should launch further unorthodox measures to help the eurozone, which is now officially in recession.
"Monetary easing is considered too radical but we believe it to be a practical move. The crisis is pulling the economy underwater. "People need breathing space. People should be helped to implement austerity programmes."
Jin told the Guardian after his speech: "European governments should be given some time … If you ask the Greek people to slash their spending by 30-40%, it's not possible. So there should be some tolerance, but the determination to carry on austerity should not be relaxed.
It is only the issue of how you can balance one against the other." CIC is one of the world's biggest sovereign wealth funds and recently bought a 10% stake in Heathrow airport. On Wednesday, Europe saw its biggest ever protests against austerity.
There were general strikes in Spain and Portugal, walkouts in Italy and Greece, and demonstrations in hundreds of cities across the region.
Demonstrators clashed with riot police in Milan, and rubber bullets were fired in Madrid and Barcelona.
guardian.co.uk
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