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French Finance Minister: “We violated all the rules” to rescue the euro;
New poll: One in three investors expect a eurozone default
In an interview with the WSJ, French Economy Minister Christine Lagarde has said, “We violated all the rules because we wanted to close ranks and really rescue the euro zone.” She said, “The Treaty of Lisbon was very straightforward. No bailing out,” adding that the Greek and Irish rescues, as well as the creation of the bailout fund, were “major transgressions” of the Treaty.
Speaking at a press conference after last week’s EU summit, French President Nicolas Sarkozy and German Chancellor Angela Merkel announced they would propose plans early next year for greater harmonisation of tax and labour policies within the eurozone. It is “important that we have a common economic policy,” Merkel said. Open
In an interview on BBC World Service, Open Europe’s Pieter Cleppe criticised Sarkozy’s comments that "the disintegration of the euro would mean the disintegration of
The FT notes that the EU will announce plans to issue up to €13bn in bonds in the coming days, through the Commission and the European Financial Stability Facility.
Meanwhile, the Irish Times reports that, in a position paper published on Friday, the ECB expressed “serious concerns” about the Irish government’s plans to aid its banking sector. Saturday’s Guardian reported that Lloyds Banking Group admitted on Friday it is to incur £4.3bn of losses on Irish loans. Saturday’s Telegraph reported that the ECB on Friday said it has arranged to borrow up to £10bn from the Bank of England in a temporary swap to ease liquidity at Irish banks. FAZ notes that German banks have the highest exposure to
The FT notes that doubts remain over the stability of
FTfm reports that one in three institutional investors is expecting at least one eurozone country to default on or restructure its debt in 2011, according to a survey of more than 2,000 hedge funds, money managers, proprietary traders and corporate trading desks, conducted by Barclays Capital.
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Merkel ally says he could “imagine” common eurozone bonds
Reuters Deutschland reports that, despite strong opposition from Chancellor Angela Merkel, there are supporters in her party, the CDU, for common eurozone bonds. CDU Minister for Saarland Peter Mueller is quoted saying that he could “imagine such bonds”, and that “it depends on how they would be designed.” Le Figaro reports that Greek Prime Minister George Papandreou has proposed launching an EU-wide campaign to collect one million signatures and present a petition in favour of the introduction of common eurozone bonds under the new European Citizens’ Initiative scheme.
Eurozone comment round-up;
In the Telegraph, Ambrose Evans-Pritchard argues that “If Germany and its hard-money allies genuinely wish to save the euro – which is open to doubt – they should stop posturing, face up to the grim imperative of a Transferunion, and desist immediately from imposing their ruinous and reactionary policies of debt deflation on southern Europe and Ireland.”
An editorial in the WSJ argues, “Thursday's decision moves the euro zone closer to a fiscal union, which is a far more politically complicated beast. The existence of a bailout fund creates moral hazard that makes future bailouts more likely, so the EU will inevitably become more involved in coordinating and even dictating fiscal policies in European countries. French Finance Minister Christine Lagarde acknowledges the new reality”.
In an opinion piece in the FT,
Saturday's Independent: Leader FT: Jacomb Weekend FT: Barber Weekend FT: Leader Irish Times: Bini Smaghi Telegraph: Evans-Pritchard WSJ: Stelzer WSJ: Editorial WSJ: Carney & Jolis Independent on Sunday: McRae Mail on Sunday El Pais: Nair
Swedish PM: Cameron’s EU budget letter too “ambiguous” and doesn’t focus on how money is spent
David Cameron faced a backlash from some EU leaders following his calls to freeze the EU budget between 2014 and 2020 in a letter circulated at last week’s EU summit. Swedish PM Fredrik Reinfeldt criticised the letter, which won the backing of
Saturday’s Telegraph reported that Cameron had reached a deal with French President Nicolas Sarkozy on the content of the budget, quoting a diplomat saying, “Sarkozy said that if Cameron leaves farm subsidies alone, then he, in turn, would leave the British rebate alone.” Open Europe Director Mats Persson was quoted in Saturday’s Independent and by the BBC saying, “A cash freeze on the EU's long-term budget without reforming its actual substance could well prove a strategic mistake. Such a deal would serve to antagonise the new member states that stand to lose the most and represent a missed opportunity to re-negotiate the EU's flawed subsidy schemes, at a time when the
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An investigation by the Sunday Telegraph has revealed that UK MEPs cost
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Van Rompuy appoints foreign policy staff to compete with Ashton’s foreign service;
Ashton defies
The Sunday Telegraph reported that EU Council President Herman Van Rompuy has appointed 20 senior foreign policy officials at a cost of at least £15 million over the next nine years, despite the fact that Catherine Ashton’s 7,000 strong EU foreign service is due to start work on 3 January.
Meanwhile, the Sunday Express reported that Baroness Ashton wants to lift an EU arms embargo against
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Saturday’s Guardian reported that the European Commission is investigating why a concert hall, situated near
Ilkka Salmi, the 42-year-old head of the Finnish security service the Suojelupoliisin, has been appointed as the new director of the EU's intelligence-sharing bureau, the Joint Situation Centre (SitCen), by EU Foreign Minister Catherine Ashton.
The Sunday Telegraph reported that Fair Trials International has warned that the high volume of extradition requests made under the European Arrest Warrant is placing an “unjustified burden” on
City AM reports that Roger Carr, president-elect of the CBI, has said that
De Telegraaf reports that proposed EU regulations could see a ban on any imported goods containing traces of pesticides, threatening many Dutch retailers with closure.
The Times reports that the EU mission sent to maintain the rule of law in Kosovo says that it may not have the jurisdiction to investigate allegations that the Kosovan Prime Minister ran a human organs trafficking ring, despite international calls for an inquiry.
In a letter to the Sunday Times, Commissioner for Enlargement Stefan Fule defended the EU’s pre-accession funds.
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