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New on the Open Europe Blog Cypriot deposit leakage continued in June Open Europe Blog Let's have a look beyond the (rather encouraging) headline figures on Spanish unemployment Open Europe Blog Turning a corner in the eurozone? Not quite yet...  Open Europe Blog
Daily Press Summary Welt: Germany seeks UK support as it considers launching a legal challenge against Commission plans for single bank resolution mechanism Die Welt reports that Germany is considering whether to launch a legal challenge against the European Commission’s Single Resolution Mechanism to wind down and rescue ailing eurozone banks, which the German government has already said it believes to be unlawful under the current EU Treaties. If Germany does not manage to block the proposals, which are subject to QMV voting, or amend them significantly, the German government could take the Commission to the European Court of Justice at the beginning of 2014 – this would delay the proposals for long enough until a new Commission is in place later in the year. The article also suggests that Germany is seeking to build an alliance with the UK, which is also concerned that the current proposals give the Commission more power than allowed under the current treaties. Welt Reuters Reuters Deutschland Cypriot deposit leakage continues as former Cypriot Finance Minister hits out at Germany over deposit write-down Open Europe reported the latest Cypriot deposit statistics on its blog yesterday, highlighting that although the figures showed a headline drop of €5.3bn in deposits in June, €3.8bn of this was due to the restructuring of Cyprus Popular Bank. The real outflow, despite capital controls, was €1.5bn – similar to the previous month. The blog was cited by the Guardian and City AM live blogs. Separately, testifying before a committee of inquiry, former Cypriot Finance Minister Michalis Sarris said that Germany pushed for a “drastic haircut” to bank deposits, adding, “Some quarters had in mind the destruction of Cyprus as a financial centre.” Open Europe blog Cyprus Mail Cyprus Mail 2 Famagusta Gazette City AM Guardian: Live blog Open Europe’s Vincenzo Scarpetta writes in City AM that the latest Spanish unemployment figures “look encouraging, but it would be premature to claim that the economy has turned a corner…The decrease in the number of unemployed people is linked to the arrival of the summer, when a lot more seasonal jobs are on offer.” Open Europe’s blog analysis of the new Spanish unemployment data featured on the Telegraph’s and Guardian’s live blogs. Open Europe blog City AM: Scarpetta Guardian: Live blog Telegraph: Live blog WSJ FT BBC Welt Welt 2FAZ Eurozone officials approve release of next tranche of Greek bailout funds Eurozone officials this morning approved the release of the next tranche of bailout funds after the Greek parliament yesterday passed a bill easing restrictions on civil servant layoffs. Following the vote, Greek Prime Minister Antonis Samaras was forced to warn two of his MPs who did not support the bill that they would be expelled if they did so again in the future. Of the €4bn in funds to be received by Greece on Monday, around €2.3bn will go to repaying bonds held by the ECB or eurozone national central banks, reports Kathimerini. Kathimerini Kathimerini 2 Kathimerini 3 WSJ Reuters EUobserver Le Monde According to a new SWG poll, only 26% of Italians trust Prime Minister Enrico Letta’s coalition government – down from 43% when the government took office at the end of April. SWG poll Corriere della Sera Repubblica In an interview with Handelsblatt, Jürgen Stark, German economist and former member of the ECB executive board, says that the ECB is moving towards a new role as a financier of independent states, and that the eurozone is “moving at high speed towards mutual debt liabilities and transfer union,” which will “manifest towards the end of the year.” No link The IMF said yesterday that the ECB may need to cut rates further, possibly into negative territory, and may need to provide another round of long term loans, preferably ones targeted to those banks that increase lending to the real economy. FT Telegraph BBC The Hungarian government has hit back at EU Justice Commissioner Viviane Reding in the two sides’ long-running dispute over changes to the country’s judicial system, claiming in a press release that “these actions and lies… cause great harm to the public image and reputation of the European Commission. Viviane Reding is either extremely ignorant, or she is lying out of political interests.” ORF Hungarian government press release The BBC reports that five EU states are trying to block Scotland’s plans for a minimum price for alcohol, claiming it would discriminate against imported products. The EU is currently considering granting the Scottish government an exemption to enact plans approved by the Scottish Parliament last year. BBC The WSJ reports that MasterCard has played down the potential threat to its revenue of an EU proposal to limit transaction fees paid by merchants. WSJ In an interview with the Irish Times, ESM Chief Klaus Regling warns Ireland against easing austerity and the terms of its bailout. Irish Times Irish Times 2 Reuters Süddeutsche reports that Germany is resisting calls from other EU countries to drop its opposition a deal on stricter CO2 emissions limits for cars. EU diplomats told the paper it is “unparalleled” that an agreement between the European Parliament, the Commission, and EU member states is now being questioned. Süddeutsche DPA reports that the celebration of Croatia’s accession to the EU has been illegally financed as the public broadcaster HRT was paid €427,000 to broadcast the event without a public invitation for tender. The Croatian Government justified the move with tight schedule constraints despite the fact that the exact date had been known for two years already. No link Gazeta Wyborcza reports that new laws liberalising Poland’s service sector will be introduced in the next couple of months, including easier access to professions like taxi drivers, tour guides and notaries. The Polish parliament has this week provisionally approved legislation covering the deregulation of a further 91 professions. Gazeta Wyborcza Open Europe research: EU Services liberalisation The European Commission yesterday presented plans intended to allow for easier and faster access to the EU’s Solidarity Fund for member states struck by natural disasters. EUobserver