Hague vetoes Ashton’s plan for a permanent EU military headquarters The proposal was supported by France, Germany and Poland. French Foreign Minister Alain Juppe called the proposal "excellent", and said that at the meeting "a very large majority was in favour". The Telegraph reports that if the headquarters were created, it would require permanent staff of 250 military officers and civil crisis management officials, which would have operational control over EU "battle groups", including British troops. Open Europe is cited in Public Service Europe warning that the proposed headquarters would undermine NATO. Italy suspends trading on government and corporate bonds as stress tests fail to ease eurozone contagion Meanwhile, eurozone officials and representatives from European banks continue to negotiate over private sector involvement in a second Greek bailout, with some form of agreement needed by Thursday. However, the FT reports that there are still three options under discussion: a debt buy-back, a rollover based on the French plan and a eurozone bank levy. Reuters reports that the bank levy is gaining support since it would avoid pushing Greece into a default rating. Officials are also trying to formulate a plan for providing additional lending to Greek banks should they be cut off from ECB lending, it is possible that the total bailout amount could need to be increased to help cover this extra cost. Handelsblatt reports that “irritation” is growing in Brussels over German Chancellor Angela Merkel’s approach to the crisis. The article quotes an unnamed source in Brussels saying Merkel’s approach is causing “serious problems”. The German SPD called on Germany to push for a debt restructuring in Greece with a haircut for of between 40% - 50%. In an interview with FAZ former ECB Chief Economist Otmar Issing, suggests that a Greek haircut is “unavoidable” but that it would not be possible within the eurozone, as it would undermine the principles of monetary union. An article in FAZ cites a report by the Ifo Institute which suggests that the introduction of Eurobonds, as a result of guaranteeing eurozone-wide debt, would see Germany’s interest payments on debt rise by €25bn a year. Figures released yesterday reveal that Spanish region Castilla-La Mancha’s budget deficit is 6.4%, well over the national and EU target of 1.3%. The region also has €2.6bn of payments pending, €0.8bn more than was thought just five days ago, reports Expansión. Separately, Open Europe’s findings that the ECB has an exposure of €444bn to struggling eurozone economies is cited by the Globe and Mail, while Intereconomia also cites Open Europe. Die Welt reports that Professor Markus Kerber, who has filed a lawsuit questioning the legality of the EU bailouts, has accused the German Constitutional Court of delaying the case until after the permanent bailout fund, the European Stability Mechanism, has been approved. Commission questions Danish reintroduction of customs controls Zapatero under pressure to call early national elections Eurozone comment round-up In City AM, Allister Heath argues: “A giant euro-bond would transfer the default risk from private institutions stupid enough to trust Club Med governments…to all European taxpayers. On his Telegraph blog, Ambrose Evans-Pritchard looks at the situation in Portugal and argues: “In Portugal — as well as Greece, Ireland, and perhaps Spain in due course — we are moving closer to the point where national leaders must decide whether to satisfy EU demands, or placate their own citizens, for it is no longer to serve these two masters at the same time. Can there really be any doubt as to the outcome of this tug-of-war?” ORFreports that "the European Commission has capitulated to the USA" on the topic of flight passengers' data, following a declaration by the Commission that it doesn't see any way to demand that the US protect European citizens’ data. The Irish Times reports that EU banks have been given a September deadline to disclose the fees they charge, otherwise mandatory transparency rules will be imposed on them. Austrian daily Kurier reports that the EU's anti-fraud watchdog OLAF have opened a fraud investigation against four top officials of the European Court of Auditors, the body which monitors the spending of EU funds. The European Ombudsman has criticised the Commission over the appointment in 2007 of former EP President Pat Cox as an adviser to an EU Commissioner, saying that it “failed to adequately examine potential conflicts of interest.” EU Foreign Ministers yesterday agreed to maintain sanctions against Syria. EU military HQ always going to be a non-starter for the UK The name’s Bond...Eurobond...Open Europe Europe
UK Foreign Minister William Hague yesterday vetoed EU Foreign Minister Baroness Ashton’s proposal to create a permanent EU military headquarters. “There is no way we will agree to this, now or in the future...we think it duplicates NATO structures and permanently disassociates EU planning from NATO planning…Secondly, it's likely to be a much more costly solution than existing structures”.
Open Europe blog Le Figaro Telegraph Straneuropa EUobserver Express EurActiv Public Service Europe
Italy suspended trading in some government and corporate bonds yesterday, as the stress test results failed to calm market fears over the escalating eurozone crisis. Italian and Spanish borrowing costs on 10-year bonds reached new record highs with both breaching 6%, while the biggest banks in both countries saw their stock market values tumble over fears of their exposure to struggling eurozone economies. Market fears also spread to UK banks, who saw their shares fall.
CityAM WSJ FT CityAM 2 FT 2 FT 3 FT 4 WSJ 2 WSJ Heard on the Street WSJ 3 El Pais El Pais 2 El Pais 3 El Pais 4EUobserver Independent Repubblica Le Monde Les Echos Les Echos 2 NYTimes Telegraph Telegraph 2 Telegraph 3Irish Times Reuters FAZ Handelsblatt Kathimerini Les Echos 3 Handelsblatt 2 FTD Handelsblatt 3 Globe and MailIntereconomia FAZ 2 Handelsblatt 4 FAZ 3 Süddeutsche Zeitung FAZ 4 Expansión
Welt
The European Commission has said that it has been “unable to get sufficient justifications from the Danish side” for the country’s reintroduction of customs controls, with EU Home Affairs Commissioner Cecilia Malmstrom saying she would “not hesitate to use all tools” to ensure that EU law guaranteeing the free movement of peoples, goods and services is upheld.
J-p.dk Politiken.dk EUobserver BBC EurActiv European Voice
An editorial in El Pais has called on Spanish President José Luis Rodríguez Zapatero to step down citing the economic crisis, and social and territorial problems as the main reasons. It also argues, “It would be unfair to say all the bad things are our responsibility. Not a small part of our afflictions has their origin in Europe, and for these, transnational solutions are necessary”. The article fuelled public debate yesterday on whether Zapatero should call early national elections.
El Pais El Pais: editorial
In the WSJ, Paul Hannon warns: “It seems unlikely that euro-zone leaders will have any answer to the contagion problem. In Le Figaro, columnist Yves de Kerdrel warns that if no solution is adopted to re-establish an “acceptable” exchange rate between the euro and other currencies, especially the US dollar, “only one exit will remain: the explosion of the euro”.
Expansion: Roubini FT Editorial FT: Jenkins FT: Webber CityAM: Heath WSJ: Hannon WSJ Heard on the Street WSJ: Rohac&Lehuta Le Figaro: de Kerdrel BBC: Hewitt Guardian: Traynor Guardian: Pratley Telegraph: Evans-Pritchard blogExpansion: Carrascosa Expansion: Editorial Expansion: Davila El Pais: Abellan Independent: Leader La Stampa: Lepri Il Sole 24 Ore: Bastasin Corriere della Sera: Messori
ORF
Irish Times
Kurier
The Parliament
WSJNew on the Open Europe blog
Open Europe blog
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Tuesday, 19 July 2011
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