Visiting financial whiz Howard Flight says economic growth and equity markets will be positive in continental Europe in the next two years. Flight's forecast should carry weight, as he is joint chairman and co-founder of Guinness Flight Hambro Asset Management, which manages more than US$12 billion (HK$93 billion). He has a wealth of financial experience from all over the world, including a stint in Hong Kong with Wardley in the 1970s. Regarding the euro, Flight said problems would not emerge until early next century. 'Europe's time has come in the international investment cycle,' Flight said. 'Recovery in Europe is already under way, driven by a 35 per cent depreciation of European currencies against the US dollar and sterling over the next two years. With massive economic slack - 20 million unemployed - inflation and interest rates should stay low.' Flight is also a Conservative MP and chairman of the all-party Hong Kong Committee of the British House of Parliament. He is cautious about the euro, saying Europe did not yet have enough economic homogeneity to support the currency. 'I expect the euro interest rate will need to be high in order to restrain economic overheating in southern Europe, especially Italy,' he said. 'This will drive unemployment to unacceptably high levels in Germany and France.' However, Flight said the main objective of the euro was political. 'It is intended, as an invisible hand, for the creation of a European State, for which much of the main motivation is the desire to combat United States economic and political hegemony. 'The US is Britain's closest political and economic ally, and the prospect of being subsumed into an anti-US European state is wholly contrary to Britain's historic interest.'