The industrialized countries of continental Europe generally faced severe economic problems due to the financial crisis, and most experienced an economic slowdown mirroring those in Britain and the United States. France, Germany, and other countries supported their banks with government loans. The government of one country, Iceland, proved unable to support its highly developed financial sector and was forced to seek assistance from outside the country. Iceland's government later collapsed due to political pressures stemming from financial turmoil; eventually both Belgium's and Latvia's governments did as well. In part due to the severity of economic problems in Eastern Europe, the financial crisis underscored continuing difficulties EU leaders face in coordinating policy when national interests conflict. Politically, some analysts questioned whether the crisis would weaken the fabric of the European Union as member states chafed against coordinated economic policymaking in an effort to bolster their sovereign economies. Meanwhile, late 2008 and early 2009 saw a reversal of the euro's run-up, and the currency saw significant losses with respect to the U.S. dollar. On the international stage, many European countries emerged as counterpoints to Washington in advance of the April 2009 G-20 meetings. Germany and France both staunchly opposed pressures from the United States for countries with large trade surpluses to increase their stimulus spending.
The following is a list of resources providing background on Western European economies and analysis on how they might weather the storm.
- NYT: Facing a Financial Crisis, European Nations Put Self-Interest First
- Transcript: The Financial Crisis: A European Perspective
- IHT: Euro Zone Officially Is in Recession
- IHT: Hundreds of Thousands Protest in France
- NYT: Iceland, in a Precarious Position, Takes Drastic Steps to Right Itself
- LAT: Sweeping bank bailouts unite Europe
- TIME: Lessons from Europe's Big Bailout
- Economist: Is Sarkozy a Closet Socialist?
- Bloomberg: Sarkozy to Raise EU6 Billion for Investments