Wednesday, September 30, 2009

The Lisbon Treaty forges an empire, an emperor and is an anvil for war!

Re: A treaty to advance EU peace-building or to develop a militarised Europe? 30/09/2009

LISBON: THE E-MAIL DUELS: In the last of our e-mail duels between Lisbon Treaty protagonists, ROGER COLE , chairman of the Peace and Neutrality Alliance (Pana), which is urging a No vote, exchanges blows with BEN TONRA , associate professor of international relations at UCD school of politics and international relations, who is an advocate of a Yes vote


ROGER COLE: Why is there a need for rapid reaction forces and EU battlegroups that will go far beyond the borders of the EU? Why does the Lisbon Treaty include an EU armaments agency to bolster the European defence industries and require Ireland to “progressively improve” its defence capabilities?

Are we not entitled to believe the EU is being militarised, and that Ireland should have no part in it?

The Lisbon Treaty’s defence agency will boost arms production and arms sales, aggravating conflicts around the world, and, no doubt, in the pursuit of profit, distorting the EU’s common foreign and security policy.

The Lisbon Treaty establishes a new EU superior to its member states. It replaces the rotation of the presidency with a permanent one. It establishes an EU minister of foreign affairs with an EU diplomatic corps. It commits the EU states to increase their military capabilities, formalises the EU battlegroups and expands their tasks to include supporting “third countries in combating terrorism in their territories”.

If it looks like a duck, quacks like a duck and walks like a duck, it’s a duck. The EU is becoming a militarised super-state, and it appears from the above that you not only clearly agree that the EU’s military should be used, but that it be used without even a UN mandate.

Ben Tonra disingenuously states: "... our rights in the EU are unassailable. Nothing in the Lisbon Treaty can require the Irish Government to go to war, to spend more on defence, to participate in any military action, to join a military alliance. Nor does the treaty allow other member states to act in our name." [emphasis mine]

Isn't the Lisbon Treaty deviously designed to alter, without the consent or vote of the people, anything, at any time, the elitists elect among their closeted selves in Brussels, Berlin and Rome? Isn't this the alarm Declan Ganley sounds? Warning: "With just intergovernmental agreement, with no need of going back to the citizens anywhere, they can make any change to this constitutional document, adding any new powers, without having to revisit an electorate anywhere."

Doesn't the Lisbon Treaty empower a virtual dictator and sidekick in Europe's theater, ready to storm the world stage in a new crusade to enforce peace through strength, Pax Romana, obedient to the oracles of their Pontifex Maximus?

Watch for closer public collaboration between the Catholic Church and European State.

Undoubtedly, the proposed European foreign minister (High Representative for Foreign and Security Affairs) will quickly be dispensed of as the European president consolidates all power to himself; Germany will dominate and France will be put into its place; Europe's imminent top ten leaders will submit to their "king of kings" and world war will be just a crisis away!

Some might scoff at secular Europe being seduced by Roman Catholic wiles, intoxicated by visions of reviving the "Holy Roman Empire," failing to grasp how they'll work together to further their own agendas (and ultimately betray each other). Never forget the occult undercurrent that fed Hitler's Third Reich as it will feed the Beast that is about to be unleashed upon the world.

As noted in The Rape of Europe: "No Means No!" -

Beyond Babylon: Europe's Rise and Fall states biblical prophecy reveals the two most powerful positions in the world will be political and religious, held with an iron-grip by a pope and emperor! Europe's imminent Church-State union awaits the crisis that will bring it all together, the lightning strike that will energize it and shock the international community.

Bible Prophecy States EU to Form Core Group

The Secret Nazis

Germany's Fourth Reich Spreads Its Wings Over the World

Open Europe press summary: 30 September 2009


Ryanair Chief Executive admits he is campaigning for a Yes because "I need to persuade them to sell me Aer Lingus";
Legal opinion cautions warns against Yes vote based on 'guarantees'
The Times reports that Ryanair has spent nearly €500,000 on advertisement and free flights, campaigning for a Yes vote in Ireland's Lisbon Treaty referendum on Friday. However, Ryanair's Chief Executive Michael O'Leary has admitted that his motives for backing the "Yes" vote include a desire to buy the partly state-owned airline Aer Lingus. In a television interview, Mr O'Leary revealed: "One of the reasons that I am campaigning for a 'yes' vote is that our Government is incompetent, yet I need to persuade them to sell me Aer Lingus."

The paper reports that the admission was seized upon as evidence of a "grubby deal", and quotes Libertas Chairman Declan Ganley saying, "We know our Government will say anything to get a 'yes'. Now it appears they will sell anything to get a 'yes' as well." He called on Irish PM Brian Cowen to clarify "any agreement made with Michael O'Leary and Ryanair in order to secure their support for the Lisbon revote".

Meanwhile, the Irish Independent reports that, in an opinion on the legal status of the Lisbon Treaty 'guarantees', senior counsel and TCD law lecturer Diarmuid Phelan has queried the guarantees, saying they are a clever EU strategy that "give the appearance" of respecting Irish sovereignty.

In his opinion, Mr Phelan highlighted a number of areas of concern, including the "veiled threat to Ireland" if the Treaty was not ratified, saying: "The campaign is set up, not as a choice between deeper integration and the status quo, which in law it is, but as a choice between in or out of Europe." He added, "Fundamentally, the State is refusing to be bound by the constitutional result, and the EU is refusing to be bound by the State's right not to ratify...On this basis, in any ordinary legal environment, one must advise against, or at the very least caution, in changing one's position on the basis of the proffered guarantees."

In the FT Larry Siedentop, a fellow of Keble College, Oxford, argues that "What matters most for the future of the EU is that it create popular support for integration. It is failing to do the EU a bureaucratic preference for reaching compromises behind the scenes and presenting them to the public as faits accomplis has been the norm. The EU may be a civil servant's dream but it is a citizen's nightmare."

Writing in the Irish Times under the headline, "We owe it to people of Europe to vote No"
Irish broadcaster Vincent Browne argues, "The European Union lacks democratic legitimacy, and instead of dealing with that issue head on, the EU conspires to avoid popular endorsement or rejection. Voting No is a way of stopping these anti-democratic capers, and in voting No we would be acting as surrogates for the people of Europe as a whole."

The paper also reports that the first polling stations for the referendum have opened for almost 800 registered voters on the islands of Arranmore, Gola, Inishboffin, Inishfree and Tory off the northwest coast.
Times Irish Times Irish Times 2 Irish Times 3 Irish Times 4 FT Irish Times 5 FT: Siedentop Irish Independent Irish Independent 2 Irish Independent 3 FT: Brussels blog
Irish Times: Smyth Irish Times: Browne Independent: McRae Irish Times 6 Irish Times 7 Irish Times Figaro Figaro2 Figaro3

Senior French diplomat: public opinion cannot stop Tony Blair becoming EU President
On his Coulisses de Bruxelles blog, Jean Quatremer looks at whether or not Tony Blair might be the first EU permanent President if the Lisbon Treaty is ratified, and quotes a high-level French diplomat saying "No-one dared to oppose Barroso. Who will dare say no to Tony Blair?" Quatremer adds that the Iraq war will not cause a problem for the former British PM, since, according to the same French diplomat, "only public opinion is concerned about this, not the 27 Heads of State and Government that will vote him in". Quatremer notes that only Spanish Prime Minister Jose Luis Zapatero might oppose Blair, but even he would find it difficult to lead a crusade against him after having supported the re-election of Barroso, who was also in favour of the Iraq war, to the head of the Commission. Under the Lisbon Treaty, the future EU President will be voted on by a qualified majority in the Council, meaning no country will have a veto.

Meanwhile, outgoing German Foreign Minister Frank-Walter Steinmeier has declared that he is officially "available" for the position of EU Foreign Minister, a position Quatremer describes as "important" since he or she will also be the Vice President of the Commission and President of the Council of EU Foreign Ministers.
Coulisses de Bruxelles OE blog

Pieter Cleppe: "Liberal parties betray their liberal democratic principles at the EU level"
In a comment piece for EUobserver, Open Europe's Pieter Cleppe criticises liberal parties belonging to the ALDE Group in the EP for betraying their liberal democratic principles at the EU level, especially when it comes to the referendums on the Lisbon Treaty. He writes: "One can argue over whether transferring more power to the EU level is a good or a bad thing. But that is not the only issue at stake here. Asking people the same question until they give the desired answer raises an utterly more fundamental debate - about the rules of the game, about democracy itself."
EU Observer: Cleppe

US financial magazine The Deal cites Open Europe's research on the EU's proposed Alternative Investment Fund Managers Directive, noting that the research found that it could lead to ongoing costs of between $1 billion and $1.44 billion as firms act to comply with the new rules.
The Deal Open Europe press release Open Europe research

Swedish EU Presidency willing to address British and German concerns over EU plans for financial supervision;
EU Commission is pushing for more powers for new EU authorities
FT Deutschland reports that Mats Odell, the Swedish Minister for Financial Markets, has said that he is willing to address British and German concerns that the EU Commission's plans for financial market supervision would weaken the powers of national regulators.

The central point of contention within the Commission proposal is that EU financial supervision authorities shall be granted binding powers over national supervisors in specific cases. Odell said: "Several member states have problems with that". He continued: "We have to find a solution which will be accepted by all governments". FT Deutschland notes that it is unlikely that the new regulations on financial supervision will be pushed through by qualified majority voting against the will of several member states, and so may be softened.

However, it is not yet clear how the new German government will position itself. The fiscal policy spokesperson for the CDU, Otto Bernhardt, said last week that an EU authority is only reasonable "for cross-border, system-relevant banks". He warned against new institutions "that act far away from democratic checks" and referred to the recent Lisbon judgment of the German Constitutional Court which made clear that every transfer of sovereignty to the EU required a vote of the German parliament.

Meanwhile Handelsblatt reports that the EU Commission is pushing for more powers for the new EU authorities. Next to the new European financial supervision authorities, the Commission proposal envisages the establishment of a European Systemic Risk Board (ESRB) in order to monitor and assess risks to the stability of the financial system as a whole. In an EU Commission consultation paper seen by Handelsblatt, the Commission appears to argue that the ESRB, or some other EU body, should have the power to implement decisions, not just make recommendations. The paper says that: "the value of such risk warnings [of the ESRB] will be limited as long as the corresponding countermeasures cannot be implemented at the level of financial institutions". The paper will be published at the beginning of November.
Financial Times Deutschland Handelsblatt Focus Reuters Open Europe press release Open Europe briefing EurActiv

EU plans new £4.1 million 'green' subsidy for civil servants
The Telegraph reports that EU officials have asked national governments for an additional £4.1 million to subsidise, by up to 50%, EU civil servants' travel on buses, trams, trains and the metro in Brussels. The new perk, which is expected to be introduced next year, will be given to 31,380 EU civil servants, many of whom already benefit from low tax rates, high salaries, pensions and a job for life, according to the article.

A Commission spokesman defended the new subsidy, saying "Even in times of crisis, the fight against climate change is a priority of this Commission. We cannot be at the forefront in fighting climate change while at the same time neglecting to take small steps that have been shown to make a real difference." However, some Commission civil servants have opposed the new perk, with one writing on the letters page of the Commission's internal newsletter: "Every day throughout the EU there are thousands of people losing their jobs, We only think of ourselves!"

Czech senators launch fresh court challenge to Lisbon Treaty;
Charlemagne: Sarkozy wants 'emergency summit' to pressure Klaus
The front page of the Irish Times reports that a group of Czech senators has lodged a new constitutional court challenge against the Lisbon Treaty, alleging that it turns the EU into a "super state". The appeal asks the court to examine whether the Treaty as a whole is compatible with the Czech constitution. It also challenges the legality of the 'guarantees' provided by EU leaders to Ireland after it first rejected the Treaty. "The senators claim the Irish guarantees are an international treaty which would need the consent of both chambers of the Czech parliament," said Tomas Langasek, General Secretary of the court.

The BBC notes that it could take the court as long as six months to deliver its verdict on the new complaint, which the senators hope will be long enough for a Conservative government to come to power in the UK and call a referendum on the Treaty. However, Czech European Affairs Minister Stefan Fule said he expected to "ratify the treaty by the end of the year."

The Economist's Charlemagne looks on his blog at how Europe might pressure the Czech Republic into signing the Treaty. He writes "I hear that the latest wheeze being discussed is an emergency EU leaders' summit, perhaps as early as next week, essentially designed to put pressure on Mr Klaus to buckle and sign." He notes that the idea is "being pushed forcefully" by French President Nicolas Sarkozy but the Swedish EU Presidency has so far been "resistant".

EUobserver notes that, following a meeting with Commission President Jose Manuel Barroso, former Czech PM Mirek Topolanek warned that his country may lose out on a Commissioner if it refuses to ratify the Treaty without delay. He added that, even if national governments did not punish the country, "The European parliament will no doubt not approve the Czech commissioner." Charlemagne notes "such a grandstanding piece of political muscle-flexing would be right up the parliament's street. Plus, the parliament is home to Lisbon's biggest fans: the treaty is Christmas come early for MEPs as it gives them so much more power."
BBC EUobserver EurActiv European Voice Irish Times Economist: Charlemagne notebook ElMundo Sueddeutsche Deutsche Welle Wiener Zeitung Standard

Cameron admits a ratified Lisbon Treaty would force re-think on a referendum
PA reports that Conservative leader David Cameron has indicated that a Conservative government would have to reconsider its promised referendum on the Lisbon Treaty if it has been ratified by the rest of the European Union by the time they come to power. Cameron said a fully ratified Treaty would present an incoming Conservative government with a "new set of circumstances" which it would have to address at the time.
No link

Leading scientists warn Commission over EU rules which could mislead consumers
The Telegraph reports that a group of leading scientists have warned that new EU rules, which will set out which products can call themselves "high" in or a "source of" Omega 3, could actually harm public health, by allowing manufacturers to use plant oils containing Omega 3, for which there are fewer proven health benefits, instead of more expensive fish oils. The scientists warn that this "exploits consumers' faith in omega-3s", and are calling on the EU to halt the progress of the regulations and set up a scientific committee to recommend new proposals.
Telegraph Times: Letters

Commission to recover €214.6 million in mis-spent agriculture funds
EUobserver reports that the European Commission is to claw back €214.6 million in farm subsidies from 18 member states due to non-compliance with EU rules or inadequate control procedures on agricultural expenditure. Some €71 million is being demanded back from France in what is the biggest bill for misuse of funds. Other countries which the funds are to be recovered from include Spain, the UK, Ireland, Italy and the Netherlands.
EUobserver Euro Tribune

Commission targets carbon trading VAT fraud ahead of UN climate summit
The Guardian reports that the European Commission has announced an overhaul of the EU's VAT system today in its latest attempt to prevent the EU's carbon trading system being subject to multimillion-pound fraud. The article notes that with just two months to go before the Copenhagen climate summit in December, the EU is desperate to show that its form of "cap-and-trade" carbon trading scheme can be used as a model for the world. The Commission said it would harmonise policy between EU states and introduce a so-called "reverse charge" mechanism, which would remove the need for VAT to change hands between carbon traders every time carbon credits are sold.

Jean Quatremer, of the French newspaper Libération, reaches the conclusion on his blog that "France is refusing to bury Lisbon if the Irish reject it again" following Pierre Lellouche's interview with French radio station LCI.
CoulissesDeBruxelles OE press summary

EIZ reports that the European Parliament's press service is largely covering the expenses for journalists to travel to Brussels or Strasbourg, allowing them "to discover the European Parliament as a journalist".EIZ Open Europe Research

Germany ready to join opposition to Turkey's EU membership
The Telegraph reports that German Chancellor Angela Merkel has said she is ready to join France and Italy in outright opposition to Turkey's membership of the EU.
No link

AFP reports that Meglena Kuneva, EU Consumer Affairs Commissioner, has warned that iPhones could be taken off the market if it is proven that manufacturing faults lie behind mystery screen explosions.
AFP The Inquirer

The Telegraph reports that Nato Secretary-General Anders Fogh Rasmussen has accused the US of talking down European allies' commitment to Afghanistan, saying "Talking down the European and Canadian contributions - as some in the United States do on occasion - can become a self-fulfilling prophecy. The allies are not running from the fight as much as the conventional wisdom says."

The Guardian reports that RBS Chief Executive Stephen Hester has warned that the EU will demand a "pound of flesh" as compensation for the billions of pounds of taxpayer funds pumped into the bank.

European Voice reports that Maroš Šef?ovi?, Slovakia's Ambassador to the EU, has been appointed European Commissioner for Education to replace Ján Figel, who is returning to domestic politics.
European Voice

HLN reports that Belgian MEP Derk-Jan Eppink, who is of Dutch nationality, has accused fellow Belgian MEPs of hypocrisy, for protesting against the Dutch refusal to deepen the river Schelde, which is vital for the port of Antwerp, saying they have been supporting the EU Habitats Directive which is being used by the Dutch government as the basis for its opposition.

The Telegraph reports that tariffs that protect European shoe makers at the expense of Asian manufacturers are expected to be extended by two years later this month.
No link

Euractiv reports that Croatia will open six and close five of its negotiating chapters for accession to the EU this Friday, following a vote in the Slovenian parliament to unblock negotiations which had been put on hold over a border dispute between the two countries.

The Express reports that the Mayor of Calais, Natacha Bouchard, has called on the UK to join the EU's Schengen Agreement, which allows the free movement of all people between member states without the need for passports or visas, in order to ease the pressure on the French port caused by asylum seekers seeking passage to the UK.

El Mundo reports that Viviane Reding, the Commissioner for Information Society and Media, supports the independence of ICANN (Internet Corporation for Assigned Names and Numbers) from the US government, which should happen tomorrow once the agreement between the Californian not-for-profit company and the American Department of Commerce will expire.


The Sun's front page declares that Labour has "lost it", and backs the Conservatives for the 2010 General Election.

Open Europe is an independent think tank campaigning for radical reform of the EU. For information on our research, events and other activities, please visit our website: or call us on 0207 197 2333.

Tuesday, September 29, 2009

Germany—Another Shaky Coalition and Young Blood

Germany—Another Shaky Coalition and Young Blood
By Ron Fraser
September 28, 2009 From
An up-and-coming German politician to watch

UNSPEET—“Germany has chosen the turning point: the CDU(Christian Democrats) and FDP (Free Democrats) will govern. … The winner of this election is Guido Westerwelle (FDP leader). Angela Merkel’s winning smile is deceptive. The CDU lost votes. She is only there due to the parlous state of the SPD and its weak competitors” (Neue Ruhr Zeitung/Neue Rhein Zeitung, September 27; translation ours).

Watching the German news convey the story of Angela Merkel’s shaky win in Sunday’s federal election in Germany, it soon became apparent that voter turnout was one of the poorest in the nation’s history.

Pundits’ early views are that many in particular who would have normally voted for Vice Chancellor Frank-Walter Steinmeier’s Social Democratic Party (SPD) simply refused to vote due to two primary reasons—Germans prefer an incumbent chancellor in times of disruption such as is currently being experienced via the global financial crisis and, second, the SPD candidate, Vice Chancellor Steinmeier, simply did not have the appeal that he needed to convince the electorate that he would be an improvement on Chancellor Merkel.

It’s the warm, plumply matronly, motherly political image that Germans preferred to cuddle up to as they approach a year ahead fraught with the prospect of ongoing financial, industrial and economic disruption.

Nevertheless, it has to be noted that Merkel’s Christian Democrats gave their second-poorest performance in the postwar history of the party in this election. It was the liberals who in fact increased their vote, offsetting the right-wing swing in a whole battery of state elections that preceded Sunday’s vote.

The result on early analysis appears to give Chancellor Merkel the opportunity to form a governing coalition with the Free Democratic Party (FDP). This will present an interesting challenge for the chancellor. It is thought that the FDP leader, Guido Westerwelle, will be given the foreign minister’s portfolio, in addition to assuming the vice chancellorship. The challenge will come if his performance in that office is not matched by that of the rising star in German politics, Merkel’s economics minister, Baron zu Guttenberg.

Zu Guttenberg has recently passed Chancellor Merkel in favor as the most popular politician in Germany, far ahead of Westerwelle.

Hailing from the entrenched Bavarian-Frankish, Catholic aristocracy, the young zu Guttenberg is the very antithesis of the liberal, homosexual Westerwelle. He is also the foreign-policy expert within his party, the Bavarian-based Christian Social Union (CSU), having taken a lead in foreign-policy debate in the German parliament.

Zu Guttenberg was a bright young leader of the young set in Bavarian politics during the long reign of Edmund Stoiber as Bavaria’s prime minister. The two carry a mutual respect for each other’s political achievements. Recently zu Guttenberg strongly endorsed Stoiber’s efforts to cut European Union red tape to the tune of prospective multiple billions of euros in savings.

This young aristocratic Frank is of particular interest to the Trumpet due to his family and political connections. His early development in political life was guided by Edmund Stoiber. He was appointed secretary general of the Bavarian Christian Social Union, Stoiber’s political party, when Stoiber was considered a prime candidate for the German chancellorship before he was just pipped at the post by Angela Merkel. Stoiber’s political mentor was the Bavarian prime minister whom he succeeded, Franz Josef Strauss, known in his time as “the strong man of Europe.”

Zu Guttenberg is also connected through part of the family line to the house of Habsburg. Strauss and Otto von Habsburg shared a common dream of a united Catholic Europe. Both personally shared details of that vision with Herbert Armstrong during visits they made to the campus of Ambassador College in Pasadena, California. To Otto von Habsburg, the dream was of a revived Holy Roman Empire. To Herbert Armstrong, that dream would become the very reality of the biblically prophesied seventh resurrection of the Holy Roman Empire.

Herbert Armstrong foresaw, and prophesied, that the European Union would fulfill that prophecy under German Roman Catholic dominion.

If, as German pundits are already claiming, the old guard in German politics is on the way out, and a new guard on the rise, then it is likely to be those of the caliber of zu Guttenberg who fill the old guard’s shoes.

Take zu Guttenberg’s impeccable Frankish-Bavarian Roman Catholic connections into mind and add them to the thread of political thought that has pervaded Bavarian politics for decades under Strauss and Stoiber—the dream of a united Catholic Europe under German leadership. Then add to it something that neither Strauss nor Stoiber ever possessed—a striking family title that cements all of these connections together—and we may well have a man to watch in the coalition that emerges when Chancellor Merkel makes her choices for her future coalition cabinet.

What is that family title?

The current Baron Karl Theodor zu Guttenberg’s official title was granted to his forebears during the 18th century. His correct title is Reichsfreiherr, the English translation being, “Baron of the Holy Roman Empire.”

If the Steinmeiers and Münteferings of the world are on the political skids, watch for the young bloods of the style of this up-and-coming Reichsfreiherr to seize the political initiative and begin to shake up German politics. They have a powerful ally in the papacy!

REUTERS: Eastern Europe's banks have underestimated bad debt, says EBRD chief econ/Hungary ready to come off IMF aid, says Central Bank's Deputy Gov/C

For Immediate Release
Tuesday, September 29, 2009

Below are Links to News Stories Filed Tuesday from the Reuters Central European Investment Summit Held in Vienna and Warsaw

E.Europe bad debt underestimated -EBRD
LONDON (Reuters) - Eastern Europe's banks have underestimated the value of bad loans they hold in the aftermath of the financial crisis and their impact will be felt across the region next year, the chief economist at the European Bank for Reconstruction and Development (EBRD) told Reuters on Tuesday.

Warning that the region's banking system remained fragile, Erik Berglof told the Reuters Central European Investment Summit the push for Western lenders to sell assets as part of conditions for obtaining state aid could also hurt the region.

He said Russia was one economy where bad debt levels were still "significantly worse" than officially reported.

"We know that non-performing loans are increasing. They haven't been increasing at the pace we were worried about (at the start) but that is because in some countries the way official statistics report them is not satisfactory," Berglof, who is also special adviser to the EBRD President, said.

He said the European Commission's demand that Western banks get rid of non-core assets could prompt these lenders to sell off Eastern and Central European subsidiaries and further tighten credit to the region.

"They are asking for...the disposal of non-strategic assets. But some of these assets are strategic for our region. Most of these subsidiaries are systemic for our region," Berglof told Reuters.

The full text of the story is on at:

Hungary ready to come off IMF aid: cbank
VIENNA (Reuters) - Hungary should not need to use the remainder of its package of International Monetary Fund-led aid, though its recovery remains fragile as it returns to market financing, the central bank's deputy governor told Reuters on Tuesday.

The central bank will continue to aid recovery but further cuts in interest rates will have to remain predictable and gradual to maintain investor confidence, Ferenc Karvalits told the Reuters Central European Investment Summit.

"The current government would like to show, and up until now, they've been successful, that they can return to market financing," Karvalits said.

"Therefore we expect that in the upcoming period, until the elections, we won't need additional sources from the IMF or the from the European Union. These are just safety cushions."

The full text of the story is on at:

CEE needs fiscal cuts, no upgrades soon: Moody's
LONDON/VIENNA (Reuters) - There is little chance of rises in eastern European countries' debt ratings in the next few years given recent fiscal expansion and worsening growth prospects, analysts from ratings agency Moody's told Reuters on Tuesday.

Moody's vice-president and senior analyst Dietmar Hornung, told the Reuters Central European Investment summit that support from the European Union and International Monetary Fundhad helped to stem the slide after the financial crisis.

But both he and colleague Kenneth Orchard said that economies and markets in the region were still fragile and that governments must tackle their fiscal problems before any upgrades of outlooks could be expected.

"The governments have to get their fiscal (positions) in order. We don't expect to be moving over to positive in the next few years," Orchard, who covers Poland, the Baltics and the Balkans, told the summit in Reuters London office.

Moody's latest sovereign report earlier on Tuesday said Hungary's rating outlook could be upped to stable if the country continues fiscal stabilization. But outlooks tend to be upped to positive before an upgrade of the actual rating.

"It takes some time to work through the system until we really see improvements," Hornung, who among other countries covers the Czech Republic, Hungary and Slovakia.

"Even in central Europe it is about stabilizing the debt trend. I don't expect for my countries that there are imminent outlook changes in the pipeline," he said.

The full text of the story is on at:

OTP profit on track, risk costs may fall soon-CFO
VIENNA (Reuters) - Hungary's OTP Bank remains on track to meets its 2009 profit target and as the global recovery picks up pace, its risk costs could begin falling as early as the second quarter, Chief Financial Officer Laszlo Bencsik told Reuters on Tuesday.

OTP's OTPB.BU, Central Europe's biggest independent bank with capitalization of $8.1 billion, expects risk provisions in the second half to remain in line with first half figures. If market condition do not change significantly, a decline could start early next year, Bencsik told the Reuters Central European Investment Summit.

"We would be surprised if it happened in the first quarter, but if we look at the momentum we have now, it could already come through in the second quarter but it could be delayed until the third or fourth," Bencsik told the summit, held in the Reuters office in Vienna.

"Our profit target is on track," he added.

The full text of the story is on at:

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Open Europe press summary: 29 September 2009


Commission's own legal service expressed reservations about intervention in Ireland's Lisbon campaign;
French Europe Minister vows to push on with EU integration, regardless of Irish voteThe Irish Times reports that the European Commission has rejected claims from No campaigners that it broke Irish rules on referendum spending after paying €150,000 to insert a guide to the Lisbon Treaty into all Sunday newspapers in Ireland. The €150,000 was paid out of the Commission's Dublin office's media budget, and was in addition to a €1.6 million contract the Commission signed recently with a PR firm to provide information about the EU in Ireland.

The Telegraph reports that the legal services of both the Commission and the Council of the EU, which represents governments, expressed reservations about the publication of the "citizens summary" of the Treaty. An EU official is quoted saying: "The lawyers asked if it was right for the commission to produce a summary of Lisbon, before it was ratified and when there was not one for the Constitution."

Irish Finance Minister Brian Lenihan yesterday described as "disturbing" a report that Libertas had received £3,000 in cash and non- cash donations of £13,964 from a London hedge fund manager. Libertas Chairman Declan Ganley responded by saying that the donation had nothing to do with the Irish referendum campaign but related to the UK European elections in June.

Ganley was quoted saying, "It was a donor who donated for that purpose and that money was well spent on the British election campaign in time for the European elections. That's it. It's got nothing to do with this". Mr Ganley said the Minister was very good at "spouting out" untruths.

Meanwhile, in an interview with French radio station LCI, Pierre Lellouche, French Minister for Europe, was asked what will happen if Ireland votes 'No'. He said: "We are waiting very impatiently because the future of 500 million Europeans lays in the hands of 3 or 4 million Irish voters... it is a very uncertain campaign". He continued: "Whatever happens, Europe will keep on going because we do not have a choice...there is a lot of work to do in the energy, immigration, industry and social fields, and we are not going to stop. So we will find solutions if ever we were faced with such a situation."

Writing in the Irish Times, Jamie Smyth questions how to close the information gap between Dublin and Brussels. He cites the Metock immigration case and the ECJ ruling that the Irish government had broken EU law by introducing restrictions on the rights of non-EU spouses to reside in Ireland. Smyth argues the ruling was "hugely controversial as the Government claimed it undermined a central plank of its immigration policy - tackling 'sham marriages'...Despite the importance of the case, not a paragraph was written in the Irish newspapers about the outcome...Clearly, the public cannot rely on Ministers to bring to their attention decisions in Brussels that have not met Irish concerns."
Irish Times Irish Times 2 Telegraph: Hannan blog Irish Times 3 BBC Irish Independent Irish Independent 2 Irish Independent 3 BBC Today programme Irish Independent 4 Irish Independent 5 Guardian EUobserver RTE Telegraph Irish Times: MacShane Irish Times 4 Irish Times: Smyth EUobserver 2 Coulisses de Bruxelles French Foreign Office

Aaronovitch: It is inconceivable that 26 member states would agree to retrospective renegotiation of Lisbon
Writing in the Times, David Aaronovitch questions what a Conservative government might do if the Irish vote Yes to the Treaty, and argues that a retrospective referendum on the Treaty could amount to a demand for a "retrospective renegotiation, and it seems inconceivable that, should such a referendum go against ratification, the other 26 nations will agree to do the whole thing again." He also writes, "Open Europe suggests that the new government should indeed hold a referendum not on Lisbon, but on something else -- a 'reform package' -- threatening to veto the EU budget if we don't get our way. Presumably Britain would be offered a yes or no to this 'reform package'."
Times: Aaronovitch

German professor: German court ruling shows why Ireland should vote No
At a press conference of Europeans organised yesterday by the Irish No campaign, Professor Dietrich Murswiek from the University of Feiburg said that the media had given the "completely wrong impression" of the ruling on the Lisbon Treaty by the German Constitutional Court. He said that the Court didn't approve of the Treaty, because it damaged German democracy and sovereignty. The only way it could be passed, Murswick said, was if Germany adopted reforms which would "repair" the damage the Treaty did to national democracy. He said that since the Irish had not taken any similar measures, the Irish people should vote No to the Treaty on democracy grounds.

On a question from a journalist on whether it could really be correct that the entire Irish political establishment, including employer organisations and main political parties, are wrong about the Lisbon Treaty, Professor Murswiek said the German government said exactly the same thing about the Lisbon Treaty before it was challenged in the German Constitutional Court. However, he said, the Court ruling showed that the "German establishment got it wrong".

The speakers also talked about the pan-European No campaign "Europe Says No - No to Lisbon, Yes to democracy" (, established this month.

The Irish Independent reports on the press conference, and quotes Danish MEP Soren Sondergaard saying that he had to "think twice" about coming to Ireland to back the 'No' campaign, but that the "interference" by the EU Commission led to his decision to call on Irish voters to reject the Treaty.
Irish Independent

French Foreign Minister suggests Blair is currently the only real candidate for EU President
In an interview with France Inter, French Foreign Minister Bernard Kouchner was asked if Tony Blair will become EU President if the Lisbon Treaty is ratified. He said, "In any case, Tony Blair is a candidate and people are talking about it a lot, yes." Asked if there are other candidates, he said, "Not many." Asked who, he said, "No, honestly", to which the interviewer replied, "So it's Blair then?" Kouchner said, "At one point there was Verhofstadt. Wait! There are others who will perhaps put themselves forward; it is not for straight away. But for the moment, indeed..." Asked if he thought it is right that a supporter of the Iraq war should become the first President of Europe, he said, "He has given several speeches on Iraq for a long time; he has been a supporter of peace; he has been the representative of the Quartet for peace in the Middle East. On the other hand, there will also perhaps be Mr. Rasmussen, the Danish President of the Socialist International who will put himself forward, but we don't know of any other candidate."

Meanwhile, Euractiv reports that Dutch Prime Minister Jan Peter Balkenende is conducting a "very subtle" lobbying campaign in Brussels to be considered a candidate for the job of EU President. The article notes that, according to unnamed sources, he will be strongly backed by German Chancellor Angela Merkel. EUobserver describes former EU Commissioner Chris Patten's speech on foreign policy at a European Parliament seminar yesterday as "a mini-manifesto" for the post of EU Foreign Minister.
French Foreign Office EurActiv EUobserver

Czech Europe Minister: We will not force Klaus to sign Lisbon, for now
Czech daily Hospodarske noviny reports that Czech legal experts are proposing that the Czech government force President Vaclav Klaus to sign the Lisbon Treaty by filing a complaint against him for inactivity. However, the article notes that Minister for European Affairs Stefan Fuele has so far rejected this course of action. He is quoted saying, "There are some legal experts who have proposed that the government embark on such a path. However, I said at the latest cabinet meeting that I saw no reason for such a course at the moment."

Svenska Dagbladet notes that Swedish PM Frederik Reinfeldt has said that even if the Irish vote Yes to the Lisbon Treaty on Friday, the Czechs and the Polish still need to sign which could delay the Treaty into the New Year, when Sweden no longer holds the rotating Presidency of the EU. According to its own provisions, the Lisbon Treaty is due to come in to force the month after the last country has ratified the document, the article reports.

Meanwhile, Cesky Rozhlas reports that former Czech PM Mirek Topolanek will today meet Commission President Jose Manuel Barroso to discuss the future of the Treaty. The article notes that during the meeting in Brussels they will discuss the candidacy for the future Czech Commissioner that will replace Vladimir Spidla, the Irish referendum and the political situation in the Czech Republic.
Ceskenoviny Cesky Rozhlas El Pais Svenska Dagbladet

Commission proposes carbon tax for transport and agriculture sectors
Euractiv reports that the European Commission is considering imposing an EU-wide tax on CO2 emissions on sectors such as transport and agriculture, which are currently not covered by the EU's emissions trading scheme. The proposed amendment of the 2003 Energy Taxation Directive would oblige member states to levy a CO2 tax on fuels in order to cut emissions. Member states would have to apply the CO2 taxes starting from 2013, according to the draft document. The article notes that the proposal would promote the use of biofuels as they will be exempt from the taxation.

Commission calls for EU-wide system to share tax details
The front page of the Express reports that the European Commission wants EU countries to allow authorities to access people's personal financial details as part of a plan aiming to combat VAT fraud. EU Commissioner Laszlo Kovacs, who tabled the proposal in August, is calling on member states to agree to give each other access to tax data under a new body called Eurofisc. The article notes that officials would be able to view the salary details, spending habits and savings of taxpayers without their knowledge.

Conservative MEP Kay Swinburne said, "Of course cross-border fraud needs to be dealt with by European cooperation but the EU is once again turning the principle of data-sharing on its head. We already grant other EU governments access to our fingerprint and DNA database and extending access to commercial information like this will only increase our vulnerability."

Swedish EU Presidency: EU Battlegroups are currently a waste of taxpayers' money
Several newspapers report that the Swedish EU Presidency is proposing an expansion of the mandate of the EU's Battlegroups in order to see them used more effectively. The Battlegroups are supposed to provide the EU with a tool for rapid crisis management, but have never been used since their establishment in 2004. The deployment of the EU Battlegroups requires a unanimous decision from member states. So far, it has proved impossible to reach such unanimity.

The Swedish EU Presidency says on its website: "It's unfortunate from more than one point of view that we build up very effective units that then aren't used. For one thing, it costs taxpayers money, and for another, we don't take the opportunity to do good where we're needed." Austrian newspaper Standard reports that Rüdiger Wolf, State Secretary in the German Ministry of Defence, said that Germany was opposed to an expansion of the Battlegroup's mandate but that he could imagine that smaller groups of member states could agree amongst themselves on the deployment of their own troops within the EU battlegroups in the future.
DPA Focus Standard Standard 2 Swedish Presidency

Leader of the Free Democratic Party tipped as new German Foreign Minister; Continuity expected in Germany's policies
Various newspapers report that with the Free Democrats enjoying their best ever result in the German elections with 14.6 percent, its leader Guido Westerwelle is most likely to take over as Foreign Minister.

German newspapers Berliner Zeitung and Die Zeit report that continuity is expected in Germany's foreign policy as well as its politics towards the EU. In terms of domestic politics, the FT notes that "Angela Merkel, the German chancellor, promised swift income tax cuts and a reform of corporate and inheritance tax on Monday but warned her Free Democratic partners in Germany's next government not to expect a more radical shift towards free-market economic policies."
Berliner Zeitung Zeit Guardian Times FT: Leader FT FT 2 Irish Times Independent Independent: Leader WSJ: Lehming Guardian: Posener Guardian: Leader IHT: Vinocur IHT: Editorial

Private Eye's Brussels Sprouts column notes that the European Ombudsman has requested that the European Parliament release documents detailing the recent development of two new Brussels buildings, for which there was no public tender.
No link

Italian Finance Minister warns over fraud and waste of EU funds in Southern Italy
Giulio Tremonti, Italian Finance Minister, declared during a Freedom Party conference that "the devolution of powers to regions has increased the amount of fraud and waste of capital involved in small projects". Tremonti continued saying that "if EU funds would be administered by the National Council on Research more sectors would probably develop faster".
Repubblica Messaggero

ECB President backs creation of pan-EU financial regulator but rejects calls for 'Tobin tax'
European Voice reports that ECB President Jean-Claude Trichet told MEPs yesterday that he backed the creation of the European Systemic Risk Board. However, he said he opposed the introduction of an international levy on financial transactions (often referred to as a Tobin tax), which has been proposed by Adair Turner, the head of the UK Financial Services Authority.
European Voice

The IHT reports that investigators commissioned by the EU are expected to conclude that Georgia ignited last year's war with Russia by attacking separatists in South Ossetia. But the report is expected to balance this conclusion by saying that Russia created and exploited the conditions that led to war.

Writing in Handelsblatt, Kurt J. Lauk, President of the German CDU party's Economic Affairs Council, said that the EU should not handle issues which can be solved by member states on their own, such as education, taxes and social issues. He said: "The citizens love Europe, but not Europe's institutions, because they make decisions without having to convince anybody."

The BBC reports that the European Commission has proposed setting a maximum noise default setting on new portable music players to protect consumers' hearing.
WSJ Irish Times EUobserver European Voice BBC EurActiv

An article on French news site Slate argues that French President Sarkozy's hopes for Franco-German leadership in fighting tax havens and bankers' bonuses may have been dashed now that Angela Merkel's CDU has the liberal FDP as a coalition partner.

The FT reports that the European Bank for Reconstruction and Development has asked for a 50 percent capital increase, €10 billion, from its shareholder governments to mitigate the impact of the global economic crisis on central and eastern European countries.
FT EUobserver FT: Wagstyl

The Times reports that, under pressure from Italian and Spanish manufacturers, the Commission is considering extending anti-dumping duties on cheap Chinese shoes.

Open Europe is an independent think tank campaigning for radical reform of the EU. For information on our research, events and other activities, please visit our website: or call us on 0207 197 2333.

Monday, September 28, 2009

For Immediate Release
Monday, September 28, 2009

Below are Links to News Stories Filed Monday from the Reuters Central European Investment Summit Held in Vienna and Warsaw

E. Europe banks, regulators head for FX loan fight
VIENNA (Reuters) - European Central Bank governing council member Ewald Nowotny called for tighter restrictions on foreign currency lending in eastern Europe on Monday, saying it had no place in credit for ordinary consumers.
Speaking at the Reuters Central European Investment Summit, Nowotny -- who oversees some of emerging Europe's biggest lenders as head of the Austrian central bank -- said general rules were needed if banks' self-regulation did not help.
"There is a very clear message, both from the local regulators and from the home regulator in Austria that we want to discourage foreign currency lending," Nowotny told the summit at the Reuters office in Vienna.
"It is not about forbidding it altogether. There are some ways to have a financial hedge where it may make sense. But for instance financing the real estate infrastructure of a country just by foreign currency lending has been a mistake."
"There is no way to deny that FX lending has substantial macroeconomic risks."
Preemptive action by central banks and ratings agency warnings last year that the region could become the "sub-prime of Europe" helped encourage lenders to cut back low-interest rate lending in euros or francs in Poland, Hungary and others.
But managers from leading emerging European banks, also at the Reuters summit, said retail lending in foreign currencies was here to stay as they battle to restart growth in the region.
"There will be more reluctance to lend in foreign currencies, but it won't work without them, in particular in countries where interest rates are high," said Martin Gruell, Chief Financial Officer with Raiffeisen International, eastern Europe's second biggest lender.
The full text of the story is on at:

ECB's Nowotny sees no exit any time soon
VIENNA (Reuters) - Recession in the euro zone is over but growth will remain sluggish next year, so there is no need to raise interest rates soon, European Central Bank (ECB) Governing Council member Ewald Nowotny told Reuters on Monday.
However, the ECB will look vigilantly at monetary and business indicators that could indicate a rise in inflationary expectations, Nowotny said at the Reuters Central European Investment Summit, which began on Monday in Vienna and Milan.
"What we see is that this very strong and dramatic decline of the economy has reached the bottom," Nowotny said.
"We will experience in most (European) countries in the third and fourth quarters of 2009 positive growth rates, so that means technically the recession will end this year," he told Reuters.
"But the growth that we see is still very sluggish for the next year. For 2010 for the euro zone there will be growth rates of 0.5-1 percent. That means it is a very slow recovery, the economy is very weak," he said.
Nowotny stuck to the ECB's policy of not pre-committing to interest rate changes, but he said he did not see personally a need to move away from current record low interest rates of 1 percent any time soon. The ECB was also not planning to unwind its support for money markets this year, he said.
"Looking at all those factors (influencing inflation expectations), for the time being I personally would not see a need for any policy changes soon," Nowotny told Reuters. "But we are vigilant to observe how things are developing."
The full text of the story is on at:

Pre-crisis boom won't return: Czech central banker Hampl
VIENNA (Reuters) - Economic growth in the Czech Republic as well as other European countries will likely not return to levels seen before the global financial crisis, Czech central bank Deputy Governor Mojmir Hampl told Reuters on Monday.
Speaking at the Reuters Central and Eastern Europe Investment Summit in Vienna, Hampl said the Czech recovery would likely have the shape of an asymmetric "W," with a second low point, less deep than the first one, around mid-2010.
Hampl also welcomed a package of tax hikes and spending cuts approved by the Czech parliament on Friday, saying it was a sign of responsibility and a proper response to the country's fast-growing fiscal gap despite a poor growth outlook.
The full text of the story is on at:

UniCredit sees CEE bad loans peak in '10
MILAN (Reuters) - Italy's UniCredit SpA, the biggest lender in central and eastern Europe, expects non-performing loans to peak next year, regional unit chief Federico Ghizzoni said
He told the Reuters Central European Investment Summit that UniCredit, Italy's biggest bank by market value, also expects provisions for bad loans in the region to top out this year.
Worries over the scale of loan defaults in central and eastern Europe -- which generates about 16 percent of UniCredit's revenues -- prompted warnings last year that states and western banks in the region could be threatened by the fallout. Those concerns have receded.
"I think the peak in terms of non-performing loans could be reached in 2010, even though with a slight increase from 2009 to 2010, so not the jump we saw between '08 and '09," Ghizzoni told Reuters.
"In term of provisions on the effects of P&L (profit and loss), the peak will be in '09."
Ghizzoni told Reuters that while loan growth and volumes would not reach pre-crisis levels over the next two or three years they would start to rise.
Non-performing loans in the area would also be far below the 30 percent seen during the Asian crisis of the late 1990s in part because families' indebtedness was well below that of western Europe, he said.
The full text of the story is on at:

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