Successes in this goal were gained by Nicolas Sarkozy becoming French President followed by France's full re-entry into NATO. The German Social Democrat led government, which had opposed the Iraq war, was replaced by a Christian Democrat-led coalition. Simultaneously the British Conservative Party, traditionally supportive of US foreign policy, actively opposed European integration.

The impact of the 2008 financial crisis, and successive European debt crises, has shaken up this situation. The German government became clear that greater steps towards greater European economic and fiscal integration were necessary to protect the euro.

The Greek bailout agreement's key terms correspond to policies supported by Germany - a private sector write down, lessening the burden falling on the German taxpayer, but which is contrary to the earlier positions of European Central Bank head Trichet, and no European bank tax as proposed by President Sarkozy.

The deal consolidating the euro secured by Chancellor Merkel also defeated the British Tory Party. They confronted the reality that a euro crisis, with its side effects, would create such international financial dislocation that it threatened the already weakened British banks, with consequent worsening of Britain’s already difficult economic position, and that the only way to prevent such a crisis was to move towards greater Eurozone integration. Therefore as the Financial Times noted, the British finance minister became "optimistic that the eurogroup of finance ministers would make progress...but said this was only the first step towards a necessary fiscal union in the single currency area. He recognised that his enthusiasm for greater eurozone integration turned British policy on its head."

The British government also fell into line with the policy of the Eurozone countries for Ireland - reducing the interest rate on Britain's loan to Ireland to 3.5 percent.

The ability of Germany's government to determine the essential conditions for a Greek bailout came when Germany has been following a more independent economic policy with success - Germany becoming the first major European economy to regain its pre-crisis level of GDP.

To pursue this Germany has sought closer relations with China – German now exports more to China than to the US. Germany has good relations with Russia. Germany declined to participate in NATO’s action on Libya. On both economic and political issues, therefore, Germany has taken a more independent position.

Practical steps towards stabilisation of the euro around a bailout for Greece, essentially on lines in accord with German policy, were therefore not welcomed by US neo-con circles - the Wall Street Journal carrying negative assessments of it. China's central bank governor Zhou Xiaochuan, however, issued a statement welcoming the agreement in line with China's support for the euro.

The measures taken around Greece are therefore of more than purely European impact. They are a significant economic and political event.

John Ross is Visiting Professor at Antai College of Economics and Management, Shanghai Jiao Tong University. From 2000 to 2008, he was then London mayor Ken Livingstone's Policy Director of Economic and Business Policy. The views expressed here do not necessarily reflect those of the China Daily website.