Germany Worries About the Iran Deal and Italian Government
European leaders have spent the week trying to figure out what to do with the Iran deal now that United States President Donald Trump has canceled it. What they decide could have major implications far beyond Iran.
Europe wants to keep trading with Iran. Trade with the Islamic republic has increased ninefold since the Iran deal was signed. But now America has told European businesses that they will face American sanctions if they continue doing business with Iran.
European leaders are not happy about being told who they can and can’t trade with. German Chancellor Angela Merkel said yesterday, “All European Union member states still stand by” the nuclear deal. The European Commission is looking for ways to strike against the U.S. if it tries to sanction European companies. The EU is also looking at trading oil with Iran in euros instead of dollars to get around U.S. sanctions.
This is just part of an economic clash building between Europe and the United States. The U.S. is currently scheduled to place sanctions on European steel and aluminum beginning next month, and again, Europe is looking for ways to strike back.
The dollar is the foundation of the world’s international trading system, giving the U.S. a great deal of power. How this will play out in the short term is unclear. But in the long term, this is adding to the EU’s desire to make a new financial system revolving around Europe.
This is something found multiple places in the Bible. Revelation 17 and 18 prophesy of a powerful European power—one that is rich through trading. The Old Testament refers to this power as “Tyre”—a reference to the ancient nation famous for its trade and merchants. You can read about the rise of this new trading system in our article “Trade Wars Have Begun.”
The other big event to hit Germany is Italy’s elections. The elections were two months ago, but the biggest winners are finally close to forming a government. And this government has been described as Germany’s nightmare. A version of the coalition agreement was leaked earlier in the week. It called for the European Central Bank to get rid of €250 billion (us$294.3 billion) of Italian debt.
The coalition says this has now been dropped from the agreement, but the damage was already done. Germany knows this government may turn around at any time and say, Yeah, we’re not going to pay your money back.
Prof. Hans-Wener Sinn, an economist at University of Munich, sees this in dire terms. He told the Daily Telegraph, “There is no possible solution to this. The catastrophe is happening. This is going to lead to the destruction of Europe, to say it bluntly. It will also bring AfD (right-wing populists) to power in Germany.”
The rise of an Italian government that wants to help itself to German money would pose a huge challenge for the euro. The government isn’t here yet, so there are a lot of unknowns. Some are saying that Italy’s policy of borrowing heavily could better its economy—for the very short term—while storing up massive problems for when an economic slowdown hits.
Sooner or later, Italy and Germany are heading for a clash. The Bible forecasts some massive changes for Europe: It will become a tightly knit, 10-nation superpower, not the current loose relationship of 28 member nations. A clash among Europe’s giants could help bring this change about. To learn more about what the Europe of the future will look like, read our free book The Holy Roman Empire in Prophecy.
Finally, a piece of news from within Germany: Bavaria’s strict new security law went into effect this week. The police now have much wider powers to tap phones and make “preventative arrests.” Critics in Germany have compared the law with the Gestapo.
Bavaria especially is shifting to the right in the wake of the migrant crisis and rise of the far-right Alternative für Deutschland. This shift to the right is also prophesied. The Bible says this coming European state will be authoritarian. Again, you can read more about this in our free book The Holy Roman Empire in Prophecy.