This morning’s edition ofPúblico remarked on the tense atmosphere in Europe as Portugal launched “the first major test this year” to see if it would be able to overcome the crisis without recourse to a bailout. The daily went on to point out that on 11 January, "the government had played its last card when it announced that it had spent 800 millions euros less than expected in 2010," which should "help counter rumours of the imminent announcement of a rescue package." Finally "a day of anxiety” for “Angela Merkel, Nicolas Sarkozy, Jean-Claude Trichet and all the European leaders" was rewarded with a positive outcome when the Lisbon government’s bond auction succeeded in raising 1.25 billion euros.

Now that Portugal has passed the test, the 13 January, "will be the day of reckoning for Italy and Spain,"notes La Stampa. The Italian daily warns against "self-fulfilling prophecies that exert such a powerful force in global finance," and, citing a study by the American bank Citigroup, claims that "the euro will survive the crisis even it the current European rescue fund holdings of 421 billion following the Greek and Irish bailouts will not be enough to refinance Spain in the event that it also needs assistance."

And if the euro overcomes the current crisis, its success will be in part due to help from the Far East. As Rzeczpospolita explains in reference to the 11 January announcement by Japan and China that they will "invest in forthcoming European bond issues," Asia is “planning to help the Eurozone.” In columns of Les Echos, Jean-Marc Vittori announces that "China will buy Spanish sovereign bonds, while Japan will buy bonds issued by the EFSF, which was established last year to rescue Eurozone states in financial difficulty." As the editorialist in the French business daily points out, there are three reasons for what amounts to "a political decision:" first and foremost "the major powers in Asia are not averse to helping friendly countries in a difficult situation."

Europe is not just a concern for Europeans

Secondly "Beijing and Tokyo are engaged in a war of influence both in Asia and in the rest of the world.” And this is the context of the Chinese Vice-Premier's "triumphal visit to Madrid to announce the decision to buy Spanish sovereign bonds," which took place last week. At the same time,El País explains that Japan "has announced it will buy 20% of thebonds issued by the European Financial Stability Facility."

The third and final reason, which is the least publicised "but probably the most important, is that Asia does not want the Euro to collapse. The Chinese are well aware that the 27-country EU trade bloc ranks ahead of the United States as their main market, while the Japanese are haunted by the possibility of a new 'endaka' or appreciation of the yen that will negatively effect their exports." In the final analysis, Les Echos concludes that “these touching gestures are a testament to the weakness of the Old Continent, but they also highlight the fact that the fate of Europe is not just a concern for Europeans."

The results of the ongoing wave of sovereign bond issues will be high on the agenda for the meeting of Eurogroup scheduled for 17 January. In the meantime,notes El País, the European Commission will give its final approval to the EU strategy for smart, sustainable and inclusive growth, which is the first step towards the harmonisation of member-state budgets and effective "economic government of the EU." The Commission is also likely to table proposals for the "shared" bond issues in accordance with a "hybrid formula:" the bonds will be jointly guaranteed by the EFSF and the issuing member state.