Europe
Divisions in Europe deepen as Greeks follow Ireland in unlimited bank deposit guarantee
Greece yesterday joined Ireland in offering unlimited guarantees to savings in domestic banks, deepening Europe's dispute over how to protect the banking sector.
The front page of Le Monde reports on divisions within Europe over the idea of a 300bn euro pan-EU bailout fund for banks. The article notes that countries and bodies favouring a more federal solution (France, Benelux, the ECB) are in conflict with the "every man for himself" position held by Berlin, and put into practice by Ireland. The Guardian quotes a senior Brussels official as saying in reference to the bailout fund: "It's dead, fini, kaput."
The FT reports that Nicolas Sarkozy was forced to distance himself yesterday from the proposed rescue scheme. "I deny the sum and the principle [of the rescue scheme]," he said, as other EU figures lined up to criticise the apparently French idea of a bail-out fund. French officials are said to be angered by the German government's very public snub to the scheme. British officials have made clear that Gordon Brown favours a primary role for national governments. The article notes that when the leaders of the 'big four' European economies meet for an emergency summit on Saturday, their efforts will focus on tightening regulation for ratings agencies, supervisory coordination, and a review of controversial 'mark to market' accounting rules.
The European Commission is looking at increasing deposit-guarantee limits across Europe, though the approval process could take some time. An article in El Pais notes however that Internal Market Commissioner Charlie McCreevy "has lost all his authority in the Commission and amongst Member States to advance even minimal reforms."
A feature in Le Monde by Pierre-Antoine Delhonnais asks whether those who predicted inevitable failure for the euro as a result of inadequate parallel political structures were right. He notes that the sharp divisions over the idea of a 'Euro-Paulson' bailout plan show that Europeans are incapable of adopting a common approach to save their banking system. He concludes the financial crisis does not only affect Europe's banks - "It is European construction in its entirety which is threatened."
A leader in the WSJ argues, "In contrast to the U.S., Europe has no lender of last resort. The European Central Bank was created to manage the supply of euros, not to rescue failing institutions. It can provide short-term liquidity against collateral to keep the money markets afloat - which it has done admirably so far. But it can't ease a solvency crisis... The rescues of Fortis and Dexia show that ad hoc cooperation in cross-border cases can work. An advantage of these spontaneous responses is that they don't require new legislation or new institutions, which the EU usually requires years to draw up". It concludes that one solution would be "to establish a temporary Continental resolution authority, not unlike the 1980s U.S. Resolution Trust Corp., with enough power and capital to put out fires across the Continent."
Le Monde The Times BBC Today Guardian EUobserver WSJ WSJ leader Economist Economist 2 FT FT 2 FT 2 FT 4 FT letters FT Clegg El Pais El Pais 2 EUobserver Irish Independent Comment: Peter Mandelson: Guardian Le Monde 2
Mandelson to return to Goverment
EU Trade Commissioner Peter Mandelson is to return to the British Government, as Gordon Brown reshuffles his cabinet - he is to return to the cabinet as a peer, as he is no longer an MP, possibly to the trade and industry portfolio. He will be replaced by Baroness Ashton of Upholland, Leader of the Lords, according to PA.
EU-wide police forces to gain power to interrogate suspects across borders
Police officers from Europe will soon be able to question suspects in custody in whichever member state they are held. Europol, whose legal basis will be strengthened to become an EU-financed agency, will have the new powers to interrogate suspects who have allegedly been involved in a crime affecting at least two member states. The plans are part of the "fight against organised crime, human trafficking and terrorism" according to the Irish Independent.
MEPs claim money for nothing
Volkskrant notes that a leaked note from European Parliament Vice-President Diana Wallis shows that more than 60 MEPs sign in to be present for the monthly EP session in Strasbourg on Fridays, although the EP does not convene on Fridays - allowing MEPs to make 200 euros each time. The so-called "Friday reimbursement" has come under fire previously and the article reports that this has cost the European Parliament 820,000 euros since 2004.
Defence Ministers launch "military Erasmus" program for young officers;
Aim is to "develop a European culture of defence"
European Defence Ministers meeting in Deauville have agreed to create an exchange program for young officers, modelled on the 'Erasmus' university exchange. They have also agreed to update the helicopter fleet, and established an initiative to obtain more military information through the European satellite program, MUSIS.
Consumers face price rises after EU extends shoe tariffs
The FT notes that consumer groups have "hit out" at the European Commission as it proposed to extend anti-dumping tariffs to shoes imported from China and Vietnam, complaining that the extra duties would raise prices further for hard-pressed consumers.
Quoted in the FT, Monique Goyens, Director-General of BEUC says "consumers, who already face huge price increases, namely in the food and energy sectors, have had to pay the bill for long enough".
Economist: EU Immigration Pact unlikely to be effective
A central part of Sarkozy's EU Presidency plans, the Immigration Pact, will have little effect according to analysis by the Economist. The main strategy of the pact is to coordinate immigration and put to an end to amnesty's of illegal immigrants from individual member states.
The Economist reports that the proposed blue card system, based on the American green card and designed to attract more highly skilled migrants, would be 'inefficient' and enforcing departures would be "slow and costly".
New study: EU could save £20bn per year if it raises the carbon cuts target
The Telegraph notes that a report, commissioned by the Health and Environment Alliance (HEAL), Climate Action Network Europe (CAN-E) and the conservation organisation WWF, argues that the EU could save an extra £4.9 - £20bn per year on health spending by setting tougher targets for cutting greenhouse gas emissions. The savings could be made if the EU target of reducing CO2 emissions by 20% by 2020 was raised to 30%.
Meanwhile, the Economist looks at how EU leaders are backtracking on their current commitments to cut carbon emissions by 20% by 2020, noting that national economic interests have replaced the "heroic mood" of March 2007, when the targets first were agreed.
A security manual, developed by France, Germany and Austria and to be handed out to prison staff, was presented to EU security experts on Wednesday.
Telegraph
World
EU and Russia: Energy security dynamic likened to arms race
The IHT runs with two comment pieces looking at the role of gas supplies in the relationship between the EU and Russia. Tatiana Mitrova likens the current situation to the arms race, "where each effort by one side to ensure its security provokes the other to build up its arsenal, and so on. In the energy field, this means investments in ever less efficient projects in order to achieve 'independence.'"
IHT-Mitrova IHT-Johnston and Kupchan EUobserver
UK
Le Monde reports that Open Europe's former director Neil O'Brien is to lead Policy Exchange.
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