It is widely reported that the European Commission’s plan for recapitalisation of European banks has been met with resistance from German bankers, with Deutsche Bank’s CEO Josef Ackermann warning of the risk of a credit crunch due to the introduction of higher capital requirements for banks and big haircuts on sovereign debt. However, in an interview with Europe1 this morning, French Economy Minister François Baroin has called the Commission’s proposal to increase European banks’ core tier one capital to 9% by mid-2012 “acceptable.” Separately, La Tribune reports that Fitch has put French banks Crédit Agricole and BNP Paribas on a negative outlook. Meanwhile, Dutch Finance Minister Jan Kees de Jager told FTD that the condition for the Netherlands agreeing to capital injections for banks, is that the EU must have the right to intervene directly in the national budgets of member states. Standard & Poor’s has downgraded Spain’s credit rating by one notch, due to weak growth prospects and high levels of private debt, reports El País. An article in theFT notes that, according to several economists, analysts and government officials, Spain will find it almost impossible to meet its deficit reduction target this year.Open Europe Europe
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Friday, 14 October 2011
Handelsblatt: Sarkozy and Merkel split over whether Treaty change should involve eurozone only
Handelsblatt reports that Germany Chancellor Angela Merkel and Franch President Nicolas Sarkozy are split over whether a new Treaty designed to impose greater fiscal discipline and control in the eurozone should be agreed by all 27 member states, or through a separate Treaty involving the 17 eurozone countries only. The article quotes a high-ranking EU diplomat saying that Sarkozy favours a eurozone Treaty, while Merkel fears that this would leave out some of Germany’s non-eurozone key partners, such as Poland.
Slovakian parliament approves EFSF expansion in second vote;
Dutch finance minister demands say over indebted countries’ budgets in return for bank recapitalisation
The Slovakian parliament yesterday ratified the expansion of the eurozone’s bailout fund, the EFSF, by a large majority, after the government and the opposition agreed to call early elections in March 2012. Following the vote, the leader of former coalition partner SaS Richard Sulik commented, “Today is a black day for Slovak and European taxpayers. I’m really sorry.” Open Europe’s Raoul Ruparel was quoted by Slovakia’s HN news service, noting that Slovakian resistance could encourage other parliaments to become more vocal in their opposition to further bailouts.
Separately, finance ministers and central bankers of the G20 will meet in Paris today to discuss the eurozone crisis, with Greece likely to remain the central focus. Le Figaro reports that, according to the French Economy Ministry, a “selective default” of Greece “can be handled.”
FAZ Welt Guardian Telegraph BBC Coulisses de Bruxelles City AM City AM: Droba Economist Irish Times MailSuddeutsche Suddeutsche 2 FAZ 2 FT FT 2 BBC Le Figaro Le Figaro 2 La Tribune 2 El País Suddeutsche 3 Bild FAZHandelsblatt Boersen Zeitung Handelsblatt Handelsblatt 2 Börsenzeitung AFN Reuters Reuters 2 FTD Elsevier WeltWSJ FT Guardian 2 Times Handelsblatt: Leader L’Expansion Le Monde Les Echos BBC 2 Expansión Le Monde 2 El País 2 FT Times FT WSJ FT: Trichet FT HN Online FTD Elsevier Economist: Charlemagne Economist El País: Schröder WSJ: Fidler WSJ: Heard on the Street FT: Achleitner Independent: McRae Sueddeutsche: Gammelin
Italian Prime Minister Silvio Berlusconi will today face a vote of confidence in the lower house of the Italian parliament. Several media reports suggest that he is going to win, given that he has refused to support a transitional government, although with a weaker majority than expected.
EU Funding fails to lift West Wales economy
Despite receiving more than £6bn in EU and matched funding from the UK, Welsh and local governments the West Wales and valleys region saw its GDP drop from 66.8% of the EU average in 2000 to 64.4% in 2008 according to the latest official figures from the EU. Welsh Labour MEP Derek Vaughan said it was clear the earliest years of the funding, known as Objective 1, were not properly managed.
Open Europe’s Pieter Cleppe was interviewed by Czech TV, commenting that in addition to the European Parliament’s visitor’s centre, the so-called ‘parlamentarium’, the EU’s policies on information are not good value for taxpayers’ money.
John Cridland, Director-General of the CBI has issued a stark warning about the effect of a number of EU regulatory proposals, arguing that: "The likely effect… will be to damage the UK's prospects for growth”, singling out the proposed EU-wide Financial Transaction Tax.
City AM reports that the leaders of the BRICS group of emerging countries are keen to contribute to the increase of the IMF capital base to help rescue debt-laden eurozone countries. The FT quotes a European official saying, “We’re increasingly coming to the view that the eurozone crisis is too big a problem for Europe to solve on its own. If you want to sort it out properly you need American and Chinese money, which means the IMF.”
Jyllands Posten reports the new Danish government wishes to hold a referendum on Denmark’s EU opt-outs in the areas of defence and justice after Denmark takes over the EU presidency next year.
PA reports that the UK Government is to opt-out of two EU directives on asylum and immigration amid "grave concerns" they would encourage those who do not need protection to make unfounded asylum claims.
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Dutch Christian Democrat MEP Lambert van Nistelrooij has called for EU development aid to China to be stopped, reports Elsevier.
RFI reports that the European Parliament voted yesterday for the accession of Bulgaria and Romania to the Schengen area. The decision was previously blocked by Finland and the Netherlands in the Council of Minsters of the EU.
Ukraine’s state security service has filed a second case against former prime minister Yulia Tymoshenko that could see her jailed for a further 12 years and forced to pay $405m in addition to the seven year sentence and $188m fine, which have been strongly criticised by the EU.
Europe Minister David Lidington has said that theUK will not hold a referendum on the limited treaty change designed to introduce the European Stability MECHA set to succeed the EFSF IN 2013, since it will only affect the eurozone, and therefore does not trigger a public vote under the coalition government’s ‘referendum lock’.
Silvio the Survivor?
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