The book trade and EU

02.12.11 | Paul Smiddy

It’s like those gritty Second World War black-and-white movies—bedraggled sailors clutching a piece of driftwood or a tattered lifebelt in a stormy and debris-strewn North Atlantic. As the weaker fall off, those remaining give a quick benediction, and then focus on their own survival. How has it come to this? These sailors were never a team; they had dissimilar skills, strengths and objectives. Indeed none of them passed the entrance exam (the Maastricht criteria). Ironic then, that-Switzerland, the only country that could have passed the tests, chose not to board the ship. Too many had joined the crew for what they could extract from it, rather than what they could contribute.

Note too, that if the European Union was a business—rather than an undemocratic political club—any sane businessman would choose not to trade with it. National accounts, and those of many of the hydra-like funds of the EU, have been questioned by EU auditors for years on grounds of poor financial management and missing funds.

One of the ingredients of this year’s perfect storm that is the eurozone crisis is that there are so many weak governments around Europe, too many leaders unsure of their own longevity. This is a partial excuse for their collective and individual failure to enact timely decisions. If there is one thing that the markets hate it is uncertainty, and investors have been given that in spades this autumn.

But putting politicians to one side, and most of us would like to (mocking the afflicted is cold comfort), what does this mean for the book trade? Exporting to any of the Club Med countries that fall out of the euro will become more difficult. Conversely, publishing directors will have to keep a closer eye on movements in the lira and the drachma to judge whether it makes sense to procure editing services or print from those countries. Of more direct concern, keep an eye on Germany—growth in the powerhouse of the EU is slowing.

Banks have had to write down their exposure to sovereign debt, and this has further curtailed their ability to lend to responsible businesses in the UK. Fragile UK consumer confidence has been knocked further, with our prime minister forced to tread a fine line in spin: trying to talk up confidence while laying the blame for our current woes on both the previous government (an open goal), and the inept fiscal determination of our eurozone neighbours (most of the defenders have gone off for a fag, taken early retirement, or are simply having a traditional long lunch). The only saving grace for our trade is that books remain extraordinarily good value; let’s hope that UK shoppers recognise that over the next month.

Now, back to our swimming classes . . .

• blog
• EU
• Eurozone
• Home
• Paul Smiddy