Europe
Irish government's guarantee to banks may fall foul of EU law
The Irish Times reports that the European Commission has said it will investigate whether the Irish government's decision to guarantee deposits and lending at six Irish-owned banks breaks EU law. The Irish government has pledged a state guarantee of 400 billion euros to cover the key liabilities of banks and mortgage lenders. The Commission has the power to launch legal action if it feels that the guarantee to Irish banks gives them a competitive advantage over foreign-owned banks operating in Ireland or in other EU countries. "If there is any state aid involved, then we will look at this as a matter of urgency", a Commission spokesman said yesterday.
Irish Finance Minister Brian Lenihan has defended the bailout saying, "It is important that Europe protects its financial system but, in the absence of a Europe-wide system, there is an onus on the Government as the sovereign body with responsibility in this State to take action."
The European Commission has so far held back on implementing EU state aid rules during the ongoing financial turbulence and questions have been raised about whether the existing state aid rules may hinder efforts to stabilise the banking sector. However, the Commission defended the rules yesterday, saying they were "part of the solution not the problem" because they gave confidence to banks that rivals would not get an unfair advantage out of the crisis.
EUobserver Telegraph FFOE blog Guardian FT BBC Irish Independent Irish Times
Conservatives offer political ceasefire over banking crisis;
Hutton: solution to financial crisis may "hinge on joining the euro"
The Tory leadership has offered Gordon Brown a political ceasefire over the banking crisis, George Osborne reveals in an interview with The Times today. Mr Osborne said that they felt a duty "as part of the political leadership" of Britain to offer assistance to Gordon Brown and Alistair Darling, helping them to rush through new banking regulation laws.
However, in an article in the Guardian, Will Hutton underlines the fact that this concession on the part of the Tories is only the first step. He suggests that Britain's solution to the financial crisis "may hinge on joining the euro".
He writes, "The US is a continental economy; it can find $700bn for its toxic debts. The UK is a medium-sized economy - but has giant banks. Royal Bank of Scotland has 2 trillion euros of assets; HSBC 1.6tn; Barclays 1.5tn; and Lloyds/TSB/HBOS 1.4tn. Together those 6.5tn euros of assets are four times Britain's GDP."
He adds, "Britain will need its own Paulson plan to respond, but has not got the financial firepower. The only viable British Paulson plan - bar a £500bn-plus international loan - may require us to join the euro to win the support of the whole of the European economy and European Central Bank as part of a pan-EU initiative to create 'good banks' for Europe."
Yet the EU Referendum blog stresses the damage EU regulation has done to the British economic system. They call the EU Capital Adequacy Directive and the Basel II agreement the "smoking guns" of the crisis and criticise Cameron for avoiding the issue in his speech at the party conference yesterday.
EU Referendum Times FT Guardian-Hutton
European frustration at Washington's failure to agree Wall Street bailout
European leaders have been expressing frustration at Washington's failure to reach agreement yesterday on a solution to the global financial crisis. The EUobserver reports that the European Commission spokesperson, Johannes Laitenberger, has been particularly forceful in stating that the US "must take its responsibility" for the global crisis which originated in the sub-prime mortgage market. However, the European Central Bank President Jean-Claude Trichet has expressed confidence that the US Congress will pass the rescue package.
EU leaders including Trichet, Nicholas Sarkozy and Commission President José Manuel Barroso are set to meet later this week to co-ordinate response policies, the Irish Times reports. However, according to Bloomberg, Trichet suggests that a pan-European approach to the banking crisis was unlikely, suggesting that each country has to "mobilise its own efforts".
EUobserver Telegraaf Bloomberg Irish Independent Irish Times
EU Parliament causes uproar over removal of anti-Strasbourg poster
The European Parliament has been accused of attempting to stifle the "single seat campaign" after a poster advocating the abolition of the Strasbourg parliamentary sessions was removed by the Parliament's security guards.
A German MEP, who organised the protest poster inviting other members to sign up, had written permission for it to appear and says in The Parliament that, "it is an outrage that members' rights to express themselves publicly is being undermined".
European Council resists calls for greater transparency over lobbyists
The Parliament reports that MEP's demands for a common register for all lobbyists wishing to have access to EU institutions have been resisted by the European Council's permanent representatives committee. The European Parliament's President Hans-Gert Pöttering wrote to the Council of Ministers seeking its support for a joint working group composed of representatives from Parliament, the European Commission and member states. In response to Mr. Pöttering's letter, the Council's permanent representatives committee replied, "The issue of lobbyists is of less relevance to the Council than to Parliament and Commission. The Council considers that, for the time being, it is not appropriate for it to engage in such an exercise."
The Council's response was branded "totally unacceptable" by transparency campaigner Monica Frassoni. The Italian MEP, a member of the parliamentary reform working group, said, "To suggest that member state representatives are not as exposed to lobbying as MEPs or Commission people is wrong and simply untrue. They are as exposed as the rest of us."
Details of all EU farm subsidies to be published online
The payments made by the EU to farmers under the Common Agricultural Policy will soon be published online. Although the Irish Independent describes the new regulation as "a nosey parker's charter", access to detailed records of payments has revealed that many wealthy farmers are still receiving millions of euros in payments from funds designated for disadvantaged farmers.
EU monitors begin Georgia patrols but refused access to buffer zones
The first EU monitors have arrived at the buffer zones around South Ossetia and Abkhazia to begin monitoring the ceasefire between Georgia and Russia.
However, according to reports by the Telegraph, Russia has refused to allow the EU monitors to patrol inside the Russian buffer zones. Al Jazeera reports that monitors have instead been deployed in the Georgian town of Gori, just outside the buffer zone, and Poti and Zugdidi, Georgian towns close to Abkhazia, the other break-away province.
BBC Reuters Le Monde Al Jazeera Telegraph EUobserver Irish Independent
EU preparing options on how to reduce Belarus sanctions
Senior EU diplomats met yesterday to discuss to what extent sanctions against Belarus can be lifted, EU Observer reports.
Poland and Lithuania are leading the push to re-open relations for fear that Belarus could be lost to Russia's sphere of influence after the Georgia conflict.
In the coming 5 years, the EU intends to sponsor television programs that deal with EU issues, costing up to 70 million euros
French EU Presidency proposes delay for car emissions reductions
EU plans to install body scanners in all airports
Full body scanners are to be installed in all international airports within two years, according to draft European legislation. Although described as "a useful tool" to combat terrorist activity, the Telegraph says that the scan "amounts to a virtual strip search". Similarly, the Irish Transport Minister describes the introduction of the scanners as "Orwellian" according to the Irish Independent.
Drop in genetically modified crops grown in EU
The area of European farmland sown with genetically modified (GM) crops declined by just over 2% in 2008. This decrease was largely due to a ban introduced in France last year following public opposition. Currently, the only type of GM crop grown in the EU is Bt Maize, a crop that was authorised ten years ago. A further 19 GM crops are awaiting EU approval.
EU to sign free-trade agreement with India for 2009
According to the Indian Prime Minister, Manmohan Singh, this would lead to an exchange of up to "100 billion euros" in goods and services.
The EU has cut its budget for birth control and health care in developing countries by 100 million euro
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