France’s president Nicolas Sarkozy and German chancellor Angela Merkel have worked together trying to find a solution for Europe’s economic crisis; but in spite of their efforts both are convinced that the Eurozone will face considerable problems in 2012. Merkel said that Europe is experiencing its “most severe test in decades”. Sarkozy acknowledged that the crisis is not over. On the other hand, a group of leading economists polled by the BBC said they expected a return to recession in Europe in the first months of 2012. The cost of credit in the region has shot up in recent weeks. Lenders fear governments will not be able to pay back the money they have already borrowed. Fears are therefore focused on a potential second credit crunch caused by the exposure of banks in Europe to the huge debt of Italy.

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