Barring all the imponderables of the future, that was a close shave, a really close shave. We never even knew we were at such a risk.

While we all went about our weekend diversions, the world out there was coming very near to meltdown. Its financial system was imploding, banks were about to fold like so many dominoes and countries, the names of which are whispered but not uttered, were about to follow Iceland or, worse, default – lose every sign of the civilisation that money underpins.

We all know now what happened next, and since all’s well that ends well, we are already putting what might have happened on a mental back-burner, along with asteroids that were about to fall and did not, or black holes that never materialised. But it may not be over that easily, and there are lessons that even here in this backwater of the world we need to learn.

What saved the world was concerted action. What in particular saved Europe was individual governments coming together and acting together, rather than individual action by individual countries, and overturning all we were thinking about the European Union, the council, rather than the Commission: a Europe of States rather than the State of Europe.

The crisis of the past few days rivals 9/11 and the fall of the Berlin Wall in the league of seismic world events. It is easy to see the unfolding of events – from the greed that fuelled mortgage securities that turned toxic in the US, coupled with lax regulation and control. The Paulson $700 billion bailout was an initial step, but still incomplete in that it only focused on toxic institutions but it still did not do the trick, or at least the whole trick. One reason was that European banks and financial organisations had been over-eager to cash in on the opaque credit swaps that infected the world’s financial system. The crisis became global.

Which is where, at least seeing it from our European perspective, the governments of Europe, the Europe that matters – that is the Eurozone and the British – came to the rescue. Up to last Sunday (that close!), the European governments were about to emerge once again as a collection of self-seeking individuals. The Irish led the way by guaranteeing all bank deposits, as they had already led the way by their rejection of the Lisbon Treaty. Then, having quashed a French plan to create a cross-border European rescue fund to bail out banks, Angela Merkel decided to go it alone. Just hours after an emergency European summit had called for greater cooperation, Berlin issued a unilateral guarantee covering German savings accounts. Paris and London were furious.

But instead of waves of recrimination, Gordon Brown’s government, beset by British savers’ money trapped in failed Icelandic banks or fleeing to Ireland, announced a novel way of treating the problem: an injection of public capital into UK banks, turning on its head a whole generation of economic theory that spoke of the benefits of liberalisation and the perils of nationalisation.

But it was only when Mr Brown called President Sarkozy and explained that, had the British government not acted as it did, British banks faced the real risk of collapsing within hours, that the rest of Europe started to understand not just the real dangers of the situation but also what was the right solution. It was in this way, and after the Eurozone summit hastily called by Sarkozy on Sunday night, that what had started as the $700 billion Paulson bailout and the British injection became the €1,873 billion Eurozone support that calmed the markets in the end.

As this leader said at the beginning, there are still imponderables ahead, and this was evident at the EU Council in mid-week, with the non-Eurozone countries, worried about what could happen to their economies, assuaged by EU assurances and, similarly, IMF help to stabilise Ukraine. There could still be reverberations in outer areas such as Russia, the oil-producing countries and even mighty China, but the meltdown seems to have been avoided.

As far as Europe is concerned, the Franco-German alliance, symbolised by the visit of Sarkozy and Merkel to De Gaulle’s shrine at Colombey-les-Deux-Eglises yesterday week, is strong again. And the UK has been brought back into the mainstream of Europe. And countries such as Sweden and Denmark, who had chosen to stay out of the euro, are now seriously considering joining at the earliest opportunity after this huge fright. So too are the countries who have taken their own sweet time in starting the laborious process on the way to the euro.

There are massive lessons to be learnt, not just in economic theory but also regarding lax regulation and the free market ideology at all costs. As said earlier, this crisis and the solving of it has led to a re-dimensioning of the European Commission and some of its hallowed ideas, not least its fundamentalist abhorrence of state aid. The world has meanwhile slipped into recession and this will cause pain across the entire planet.

It is this wide background that must form the context of the forthcoming government decisions regarding the economy. The lessons must be learnt, along with the specific lesson of how we are to face up to the oil price spiral (don’t crow too much about oil at $72 a barrel – the price fundamentals will see it rise again). But in the meantime we have already learned a lesson ahead of time, for had we not joined the euro we would have been as much at risk as Iceland. What we must now focus on is how best to tackle recession not just locally but also in our markets. The recent Global Competitive Survey shows us where we must improve – and a lot – our performance. We must remember that we are still on the lowest rungs of the EU ladder; the time has not come for self-gratification but rather for harder and harder work.