Europe
Jose Manuel Barroso: "Economic policy isn't a national, but a European matter";
Herman Van Rompuy calls for EU "economic government"
Handelsblatt reports that the new European Commission plans to "interfere more in national economic policies" and quotes Commission President Jose Manuel Barroso saying: "Economic policy isn't a national, but a European matter. No modern economy is an island. When a member state doesn't make reforms, others suffer because of that."
The article notes that Barroso wants the power to refuse EU payments for structural funds to member states unwilling to make reforms. Every member state would have to set itself individual quantifiable goals, in order to contribute to the new "Europe 2020" growth strategy.
According to Barroso, the Lisbon Treaty offers the Commission new means to influence national economic policy. Speaking to the European Parliament this morning, he said: "This is a time for boldness. I believe that our economic and social situation demands a radical shift from the status quo. And the new Lisbon Treaty allows this."
He added, "It [the EU] is less successful when we act according to narrow national interests, in an un-coordinated way...Some national politicians, let's face it, are not in favour of a more co-ordinated approach in economic policy. But if we want to overcome the crisis... and establish a good basis for a strong economic future for Europe in the globalised world... then stronger economic co-ordination is the only way forward."
Meanwhile, AFP reports that EU President Herman Van Rompuy is calling for an "economic government" for the bloc, with closer policy coordination and financial incentives for good performers. Ahead of the EU summit on Thursday which will focus on a new economy strategy, he said in a statement: "The crisis has revealed our weaknesses", adding that at present individual European nations "are responsible for the economic strategy of their government. They should do the same at EU level".
He also said, "Whether it is called coordination of policies or economic government" only the European nations working together are "capable of delivering and sustaining a common European strategy for more growth and more jobs...Recent developments in the euro area highlight the urgent need to strengthen our economic governance".
Le Soir reports that President Van Rompuy will propose that the EU budget should be used to give "incentives" to member states to implement agreed structural reforms and economic policies to preserve growth in the EU.
Handelsblatt suggests that Berlin has given up its staunch opposition to the concept of an EU 'economic government' because it sees it as the best way of influencing the economic policy of other member states.
Writing in the WSJ Patience Wheatcroft argues that the eurozone crisis may move from being about sovereign debt to "sovereignty itself". She writes that Spain's Prime Minister "said last week that he believed the economic plan for the next ten years should involve a move to a single economic policy for the EU, covering spending, investment and tax policies...Having remained outside the single currency, Britain will be on the sidelines of such a debate."
FT FT 2 IHT AFP Le Soir Le Figaro Le Figaro Les Echos France soir WSJ: Wheatcroft
MEP fears his damning report on EP expenditure will be watered down
EUobserver notes that a damning report by Belgian Green MEP Bart Staes, a member of the European Parliament's Budgetary Control Committee, is set to question the very fundamentals of the institution's budgetary discharge procedure, and is coming under considerable pressure from the institution's Bureau as a result. The soon to be published document, set to form the basis for committee debate on Parliament's 2008 expenditure over the coming weeks, will direct strong criticism towards the legislature's procurement procedure and raises concerns over recent calls to increase money for MEP assistants before a proper review is carried out.
According to Staes, the document asks whether it is correct that Parliament should sign off on its own accounts - the Council of Ministers, representing member states, also has to approve Parliament's expenditure but a 'gentleman's agreement' means scrutiny is kept to a bare minimum.
De Standaard notes that Staes fears his report will be watered down and quotes him saying: "we're often criticised, particularly in the eurosceptic press. We could avoid that by being strict on ourselves and drawing clearer lines but I fear we're going to have the same problems in 4 years time at the elections."
EUobserver Standaard Open Europe blog
Traders amass biggest ever short position betting against euro
The front page of the FT reports that traders and hedge funds have bet nearly $8bn against the euro, suggesting that investors are losing confidence in the single currency's ability to withstand any contagion from Greece's budget problems to other European countries. Spain's Finance Minister Elena Salgado flew to London yesterday for emergency talks with bondholders to reassure them over concerns on Spain's debt problems, according to City AM.
José Blanco, Spain's Public Works Minister, hit out at "financial speculators" for attacking the euro and criticised "apocalyptic commentaries" about Spain's finances. Nobel Prize winner Joseph Stiglitz, who is advising the Greek government, last night denied that the country would require a bail-out, and urged national authorities to intervene in markets to "teach the speculators a lesson".
Writing in the Times, Business Editor David Wighton argues: "Some sort of bailout [of Greece] by the rest of the eurozone is looking more likely by the day." PA quotes Commission President Jose Manuel Barroso saying to the European Parliament this morning, "Those who think it (the euro) can be put in question must realise we will stick to our course. The European Union has the necessary framework to address any challenge that appears in this respect."
The Irish Times reports that European Central Bank President Jean-Claude Trichet will cut short a trip to Australia to attend this week's special EU economic summit - an indication that the future of the euro is likely to be high on the agenda.
Meanwhile, the WSJ notes that four separate polls over the weekend showed public support in Greece of more than 60% for tough measures to fix the country's public finances, with some Greeks wanting even-stiffer overhauls.
FT Telegraph Independent City AM Times: Wighton WSJ WSJ 2 City AM: Heath Guardian EUobserver FT: Alphaville ABC El Pais Expansion Irish Times BBC: Hewitt blog
MEPs are expected to approve the new 26-member Commission team in a vote this afternoon.
AFP Irish Times EUobserver BBC
FSA says EU's AIFM Directive continues to carry "significant risks"
The Guardian reports that the Financial Services Authority (FSA) has said that the EU's proposed Alternative Investment Fund Managers (AIFM) Directive still carries "significant risks", even though some stricter rules were toned down during negotiations between member states. Dan Waters, Sector Leader for Asset Management at the FSA, said: "I would not underestimate the significant risks that still exist in this draft directive. It could still go badly wrong in some important areas."
Waters' said the European Parliament's version of the Directive contained dangers, despite the huge number of amendments. "The parliamentary text is very far away from an acceptable position from the UK's point of view," he said.
Waters added that changes put forward last week by the EU's Spanish Presidency, which include reintroducing limits on hedge fund marketing, were unjustified. "We are not on safe ground yet. It is incumbent upon regulators and investors to stay very active in this debate."
City AM Guardian EurActiv Open Europe research: AIFMD Open Europe research: Investment trusts
German government fears a loss of power due to Barroso's concessions to EP
Handelsblatt reports that the German government is angry with Commission President Jose Manuel Barroso's decision to grant more powers to the European Parliament, with government sources calling it a "dangerous alteration in the balance of power within EU institutions". A new agreement, on which MEPs are to vote today, provides that the Commission will have to consider legal proposals from the Parliament within three months of them being tabled. The Commission must then submit a legislative proposal, or explain its decision for not doing so, within one year of the Parliament's initiative.
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Ian Traynor: EU has started new regime under Lisbon "with a whimper"
On the front page of the Guardian under the headline "Europe loses seat at top table", Ian Traynor looks at the EU's post-Lisbon Treaty influence on the world stage. He writes, "The new regime has started not with a bang but with a whimper. Where there was to be coherence, there is confusion. Where there was to be clear leadership, there are turf wars and rival presidents." Traynor adds, "For the Europeans who claimed for two years to be leading the world on climate change, the global warming summit in Copenhagen was the gamechanger, a moment when the global balance of power tilted and relegated the EU to the second division."
Guardian: Traynor
French Defence Minister defends country's record on Afghanistan
The WSJ reports that, after meetings with his US counterpart, French Defence Minister Hervé Morin defended his country's decision to send only 80 additional military trainers to Afghanistan, saying France has already increased its presence by 1,300 soldiers in less than two years. The article also notes that France has decided to sell an amphibious assault ship to Russia, with eastern European NATO allies criticising the deal - the first by a NATO member to Russia since the end of the Cold War - and the US weighing in on their behalf.
The Economist's Charlemagne blog notes that "a senior Russian admiral approvingly declared that if such ships had been in the fleet in 2008, Russian forces would have overrun Georgia 'within 40 minutes', rather than in 26 hours."
WSJ Economist: Charlemagne blog
The IHT looks at the latest email fraud in the EU's Emissions Trading Scheme and notes that various "forms of shady trades have beset the carbon markets in Europe."
IHT Open Europe research
Writing in the Irish Times Arthur Beesley looks at David Cameron's pledge to repatriate powers from the EU in social and employment policy, adding: "in the corridors of EU office blocks it is readily acknowledged that it would be very difficult for Europe to resist pressure for a modest review from a member of Britain's size and might. In that context, EU sources say Cameron would have to yield something in return."
Irish Times: Beesley
EUobserver reports that EU Foreign Minister Catherine Ashton has congratulated Ukraine on holding free and fair presidential elections, in which Viktor Yanukovych has claimed victory.
Times: Leader WSJ EUobserver BBC EurActiv
City AM reports that Laurent Collet-Billon, Head of France's DGA arms procurement and export agency, has said that a deal on the future of the long delayed and over-budget A400M Airbus military transport plane could be reached this week or next.
City AM
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: openeurope.org.uk or call us on 0207 197 2333.
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