Europe Rejection of bailout for eastern European countries prompts currencies to fall; Poland renews commitment to swift membership of the Euro The IHT reports that currencies across eastern Europe plunged yesterday after EU leaders rejected a 180bn euro rescue package proposed by Hungarian Prime Minister Ferenc Gyurcsany. The paper notes that EU officials rejected suggestions that the foreign exchange markets were reacting to decisions made at Sunday's summit, where leaders agreed only to consider bailouts on a case-by-case basis. EU Monetary Affairs Commissioner Joaquin Almunia told reporters in Brussels that the EU was providing a huge amount of support to its eastern members already. But he conceded more may be needed for some countries. However, the paper notes that bank analysts and traders have been unimpressed with the EU's response, as reflected in sharp currency market drops. "The EU again has proven it is unable to manage a coordinated response to the crisis," Commerzbank analysts wrote in a note on Monday. "The problems arising in Eastern Europe will put further pressure on the euro." The FT reports that Poland has renewed its commitment to bid for early accession to the eurozone amid signs the financial crisis has prompted EU leaders to consider shortening the entry process. The article notes that despite Hungary's attempts to speak on behalf of the region at Sunday's summit, Poland and the Czech Republic were keen to differentiate themselves from the more troubled economies in the region. Jacek Rostowski, Poland's Finance Minister, said, "We think a one-size-fits-all approach to the region is not right. What's needed is differentiation. Countries should be helped according to their needs, whether they are in eastern Europe or in western Europe." Writing in the FT, Gideon Rachman argues that "The European Union is in trouble...The strain of the economic crisis is indeed opening up divisions within the Union". He adds, "Plans for a political union in Europe were always crazy. But the four freedoms already established by the EU - free movement of goods, people, services and capital - are huge and tangible achievements. It would be terrible to see them rolled back." In the Times, Brownen Maddox suggests that western Europe was never going to be able to live up to eastern Europe's expectations: "The blunt truth is that the newcomers' hopes of becoming Spain, or the Irish Republic -- poor countries transformed in a decade or so by the EU -- were never realistic." She adds, "Any recession -- never mind one as acute as this -- would have driven home the point that the east wants more than voters in the west want to pay." Dpa reports that Dominique Strauss-Kahn, Managing Director of the IMF, has told the US radio channel NPR that EU Heads of State and Government "did not do their best" at the EU summit on Sunday. Strauss-Kahn went on to say that "the Eurozone has a common currency but no uniform economic policy". FT FT: Brussels blog EurActiv IHT Irish Independent Telegraph: Michaels and Waterfield WSJ: Mayer Times: MaddoxIndependent FT: Rachman OE Blog dpa ECJ to rule on UK's retirement age rules PA reports that the European Court of Justice (ECJ) is due to deliver a judgment on Thursday which campaigners say will affect the UK's position on age and retirement rules. The default retirement age of 65, introduced in 2006 as part of regulations aimed at tackling ageism in the workplace, is being challenged by Age Concern. Andrew Lockley of law firm Irwin Mitchell, said, "The decision of the ECJ will guide the High Court when it comes to consider whether the UK Government can justify the default retirement age of 65." He added, "There are also a number of claims of age discrimination by workers who have been retired against their will, which are on hold until the ECJ has given judgment." No link Czech Government agrees to law allowing parliament to challenge major transfers of power to the EU Czech news agency CTK reports that the Czech cabinet has approved a draft amendment, initiated by the ruling party ODS, to make transfers of power to the EU subject to parliamentary consent. The amendment still needs the approval of the Czech parliament to come in to force. The amendment specifies the types of EU "crucial decisions" which the Czech government or president would not be able to sign up to without the consent of both houses of parliament. The law also establishes the lower and upper houses' right to challenge EU legislation at the European Court of Justice over violation of the principle of subsidiarity. Some senators, mainly senior ruling Civic Democratic Party (ODS) representatives, have said they would vote against the Lisbon Treaty if the special mandate is not introduced. "As we live in parliamentary democracy, we refuse to allow the government to do whatever it wants, irrespective what the government is like," Premysl Sobotka, Head of the Senate, toldCTK last week. No link MacShane: "Rarely has Europe been so disunited" There are several comment pieces about Gordon Brown's trip to meet President Obama, with Philip Stephens arguing in theFT that "If Britain wants to be heard in the White House, surely it must show it has real clout in Europe." Writing in Newsweek magazine, former Europe Minister Denis MacShane argues "Rarely has Europe been so at sixes and sevens, so disunited, so quarrelsome on economic, security and foreign-policy issues." He goes on to say that "what he [Obama] really needs is a united Europe. But instead...he is getting a cacophony of different voices, screeching at each other. Little wonder if he decides to tune out." Steve Richards writing in the Independent, argues "With a predictably chaotic complacency the EU has failed even to agree on the principle of a single supervisor to regulate its cross-border banks, let alone reached common ground on a recovery package. Eurosceptics should take a close look at the EU's response to this crisis and relax. It is an institution that cannot agree about anything." Independent Newsweek FT: Stephens Deutsche Bank: EU carbon trading could be "difficult to sustain" EurActiv reports that UK Energy and Climate Change Secretary Ed Miliband has joined calls to demand that the EU prop up the carbon market, as the price of EU emissions allowances remains under 10 euros. A report by Deutsche Bank has also called for action from EU policymakers if the allowance price falls further, saying "With so much political capital invested by the EU in establishing a global carbon market, a very weak EUA price and potentially significantly reduced activity in new CDM [Clean Development Mechanism] origination in the months leading up to Copenhagen would in our view be very difficult for the EU to sustain politically". The report also urges the bloc to investigate the possibility of setting reserve prices for permits from 2013. Open Europe's Mats Persson was quoted on Italian website ANSA, reacting to the news that the European Parliament and the Commission have spent 24 million pounds purchasing the Conservatives' former headquarters in central London. No link French Defence Minister: we want to hear British support for "Europeanisation" of NATO Speaking at a meeting in Washington, French Defence Minister Herve Morin has reiterated the conditions on which France will rejoin NATO. He said that European officers, in particular French ones, would have to be given "a certain number of the important and strategic posts currently held by American officers", which, he said, would be a sign of the "Europeanisation of NATO." He also said he expected the new Obama administration to recognise that "defence Europe is a necessity", and said that he wanted to hear a positive "message" from the British. According to Suddeutsche Zeitung, the German government does not want to commit itself to bail out the car manufacturer OPEL. According to FAZ, German Foreign Minister Frank-Walter Steinmeier has proposed a "European solution", but German Chancellor Angela Merkel criticised the suggestion, saying it was "potentially dangerous for German corporations as other European firms could profit from German financial support". No link Economic crisis hits northern Europe According to Handelsblatt, the global economic crisis is now affecting northern Europe. For the first time in decades, Denmark, Finland and Sweden are in a deep recession and Norway is also fighting its shrinking economy. Reportedly, Sweden is especially affected by the recession due to its large export sector. The Chief Economist of the Swedish Bank SEB is quoted by Handelsblatt saying: "The rock bottom is not yet hit". In Le Figaro, former German Foreign Minister Joschka Fischer laments the lack of EU unity over the financial crisis. He calls for the rapid introduction of "new instruments like Eurobonds", or "a new European mechanism comparable to the IMF", ideas which he acknowledges would be expensive, "especially for Germany." Irish Green Party leader John Gormley has said Ireland should withdraw from the European Defence Agency to help persuade the public to back the Lisbon Treaty. Libertas Partei Deutschland launched in Berlin yesterday. Party founder Declan Ganley announced that Libertas has hired Joe Trippi, described as one of the world's leading internet fundraising strategists. EU Environment Ministers yesterday rejected attempts by the Commission to force Austria and Hungary to allow the cultivation of GM maize. European Voice European Voice 2 EurActiv Welt Wiener Zeitung ORF The annual report from the US Trade Representative's office has signalled that the Obama administration may take a tough line in negotiations in the Doha trade talks this year, indicating that they believe talks are currently going against the US. The Evening Standard reports that Number 10 has rejected an application for an e-petition which called on Gordon Brown to "undertake to do whatever is necessary to prevent Tony Blair ever becoming President of the EU." The reason given by officials was that the request was "outside the remit or powers of the Prime Minister and Government." Private Eye's Brussels Sprouts column notes that when asked about the EU's Eurostar project, part of the EU's Eureka research and development programme, and aimed at aiding small businesses, neither the Department for Innovation, Universities and Skills, nor the Department of Business, Enterprise and Regulatory Reform was aware of its existence, despite it receiving 10m pounds of Government funds from the Treasury. No link Angela Merkel has confirmed Germany's opposition to public funding for the Nabucco pipeline project, saying that financing was not the issue, but finding the gas for the pipeline was the problem. The Independent carries a feature on the UK Independence Party, describing it as a "party in meltdown". Independent Telegraph: Letters UK Conservatives most trusted with economy A ComRes poll for the Independent shows that the Conservatives have overtaken Labour as the party most trusted to handle the economic crisis. In November, 47 per cent trusted Labour and 28 percent trusted the Conservatives, which is now at 35 per cent for the Conservatives, 28 percent for Labour and 9 percent for the Liberal Democrats. World US officials have revealed that Barack Obama last month sent a secret letter to the Russian President offering to back off deploying a new missile defence system in eastern Europe if Moscow would help stop Iran from developing long-range weapons.Open Europe
Tuesday, 3 March 2009
Posts
