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Europe
FAZ: ECB rate rise hint is “a good signal for price stability”;
El País: “The ECB complicates the crisis in Spain”
The European Central Bank surprised financial markets yesterday by strongly hinting that interest rates will be raised next month. ECB President Jean-Claude Trichet said the ECB would exercise “strong vigilance” over inflation, a term which is widely accepted to signal a rate rise at the next meeting. There is speculation that part of the ECB’s motivation is to increase pressure on eurozone leaders to agree comprehensive economic governance and rescue packages during the two March summits.
An article in El País, titled “The ECB complicates the crisis in Spain”, notes that a rise in interest rates could hinder the recovery of Spain and other weaker eurozone economies.A leader in FAZ argues that Trichet’s declarations are “a good signal for price stability. It would be a blessing if the ECB were so decisive in dealing with [European] banks.” Handelsblatt notes that Trichet also announced that the ECB would provide European banks with as much liquidity as they need, at least until the middle of the year.
An article in FAZ reports that German Finance Minister Wolfgang Schäuble is now again calling into question an increase in the size of eurozone's temporary bail-out scheme, the €440bn European Financial Stability Facility.
The Irish Times reports that EU centre-right leaders will meet in Helsinki today, with the possible renegotiation of the Irish bail-out terms as one of the top issues on the agenda. Reuters reports that senior German CDU MP Michael Meister has suggested that Germany may be willing to support a cut of the interest rate Ireland has to pay on its bail-out loan, if Dublin agrees to raise its corporate tax rate.
FT FT Money Supply FT Davies FT Alphaville WSJ WSJ Agenda European Voice BBC Le Figaro Les Echos Guardian El Pais IHT Telegraph WSJ 2 FT 2 FT 3 FT Editorial WSJ 3 EurActiv IHT 2 Economist Irish Times Irish Times 2 Les Echos El Pais 2 FAZ: Leader Reuters
MEPs vote to increase annual staff allowance by a further £15,336;
Italian journalist: The increase is “caviar for eurosceptic palates”
The Telegraph reports that the European Parliament’s Committee on Budgets voted yesterday to increase MEPs’ annual staff allowance by a further £15,336, despite previously agreeing to a freeze in line with austerity measures being implemented by EU member states. The article notes that the new increase will bring the staff allowance for each MEP up to almost £220,000 a year.
Open Europe Director Mats Persson is quoted saying: “Asking for even more cash now, at a time of continued austerity in member states, isn’t exactly going to increase the popularity of MEPs, which is already at all-time low.” Mats is also quoted in the Irish Independent. On his Straneuropa blog, Italian journalist Marco Zatterin notes that the increase is “caviar for eurosceptic palates.”
Telegraph Coulisses de Bruxelles Straneuropa EUobserver European Voice Irish Independent
France and UK to present proposal for possible no-fly zone over Libya at next week’s EU summit
French Foreign Minister Alain Juppé yesterday announced that France and the UK would present contingency plans for a no-fly zone over Libya at next week’s EU summit in Brussels. However, he reiterated that France believes that military intervention “in the current circumstances” would be unwelcome and counterproductive.
Meanwhile, an article in EUobserver notes that mistakes made in EU documents detailing arms sales highlight “weaknesses in the EU’s arms control regime”. The article notes that although arms sales to Libya were not against EU rules, the EU's Code of Conduct on arms sales says that "respect for human rights in the country of final destination" is a top criterion for granting permits which should be denied "if there is a clear risk that the military technology or equipment to be exported might be used for internal repression."
EUobserver BBC: Today Le Figaro El Pais Irish Times Economist: Charlemagne Economist Times: O’Neill
European Banking Authority announces new round of stress tests;
FT Deutschland: Tests ignore the majority of banks’ debt holdings
The EU’s new banking watchdog has announced a new round of stress tests on European banks, with results due in June. The tests are to measure banks’ ability to withstand economic shocks, with a parallel exercise to determine their liquidity. Previous tests failed to inspire confidence as balance sheet problems later emerged, notably at Spanish and Irish banks. FT Deutschland reports similar concerns this time, as only sovereign debt held on the trading book is to be stress-tested, ignoring the majority of government bonds held on the banking book.
FT Deutschland Reuters IHT
Briton faces trial in Greece after extradition under the European Arrest Warrant
The Times reports that 22-year-old Andrew Symeou is due to appear in court tomorrow in Greece after being arrested in 2008 under the European Arrest Warrant (EAW). Symeou was extradited to Greece in 2009 and spent almost one year in a Greek prison awaiting trial, before finally being granted bail last year. A leader in the Times notes, “Others worry that a warrant that was designed to speed up the extradition of people suspected of terrorism or organised crime is increasingly being applied to ordinary citizens, with too few safeguards.”
Times Times: Leader
An article in Europe’s World on the EU budget cites Open Europe’s research based on leaked European Council figures from 2006, revealing that between 2007 and 2013 the UK’s contribution to the EU budget is €103bn while only receiving €46bn.
Open Europe research Open Europe blog
Spanish paper ABC reports on allegations that EU employment subsidies managed by the regional government in Andalucía have been subject to “massive fraud.” The case is now under investigation.
ABC
In the Irish Independent, Kevin Myers looks at the ECJ’s recent ruling banning the use of gender in determining different insurance risks and argues: “The notion of 'equality' is a violation of the whole principle of insurance, in which an actuarial assessment of risk is the key ingredient…Naturally, since this is basically an ideological ruling, the same principles are being spread to other actuarial assessments, such as pensions.”
Open Europe research Irish Independent: Myers Economist
According to an internal strategic paper seen by FAZ, the European Commission intends to push ahead with plans to bring the EU’s 2020 emissions cuts target up to 30%, despite resistance from member states.
No link
The Irish Times reports that coalition talks between Irish centre-right party Fine Gael and Labour may get stuck over a disagreement on how quickly public finances can be cut without causing irreparable harm to the Irish economy.
Irish Times
The Telegraph reports that the UK and Ireland are the only two states to have opted-out of the EU’s Cross Border Enforcement Directive, which aims to make it easier to track down and prosecute drivers committing motoring offences in other countries.
Telegraph Mirror
Bulgaria, Ireland and Norway will reopen their carbon trading emissions registries today, after fraud forced their suspension on 19 January. However, security doubts have led to two carbon spot markets – Climex and APX-ENDEX – to close their operations for good, reports EurActiv.
EurActiv
UK
The Labour party has retained its Barnsley Central seat following a by-election, gaining 61% of the vote on a 37% turnout. UKIP’s historic second place finish above the Conservatives and the Liberal Democrats’ sixth place finish came as a surprise to most observers.
Telegraph Times Guardian BBC
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