Commission considers plans for approving eurozone members' budgets before national parliaments;
German MP: "Plan for more Commission budget supervision would mean end of parliamentary democracy"
In a speech to the European Policy Centre yesterday, EU Monetary Affairs Commissioner Olli Rehn said that the Commission is planning on presenting plans next month which would see eurozone governments submit their national budgets to the EU for approval, before they were sent to national parliaments.
He is quoted by EUobserver saying: "We should use the first months of the year, say January to July, to request draft national budgets. Not budget-line by budget-line ...but the overall budget, so that the commission would analyse and the eurogroup [of euro area finance ministers] would make a peer review and recommendations on national budgets, before they are presented to national parliaments".
Sueddeutsche Zeitung reports that the German Parliament would strongly resist the Commission's plans, with representatives of both the German government and opposition saying they will resist the measures. "That won't fly", Christian Democrat Budget spokesman Norbert Barthle is quoted saying.
Social Democrat MP Carsten Schneider is quoted saying that if the Bundestag were to give up its budget autonomy, "this would be the end of parliamentary democracy as we have known it so far...Never ever will I agree with that."
EUobserver EU press release FT: Leader SZ Tijd FAZ
Barnier calls for common EU rules on bank insolvencies
The FT reports that the European Commission is expected to push for an EU-wide system for bailing out ailing banks, primarily financed by the industry, when EU finance ministers meet for informal talks in Madrid this weekend.
In a letter, EU Internal Market Commissioner Michel Barnier argues that plans should include "early intervention powers" that would allow regulators to step-in and take over aspects of a failing bank's governance, including distribution of profits, according to European Voice.
He calls for the creation of national funds, financed through taxes on banks, to pay for financial sector insolvencies. Barnier also calls for "robust burden-sharing arrangements" between member states for cross-border banking groups. He also believes the EU "should consider" harmonising national laws on insolvency and administrative liquidation - a sensitive issue for member states, as it would force them to change traditional approaches to dealing with bankruptcies.
Meanwhile, Handelsblatt reports that the concept of a "bank levy" has disappeared from an EU document for the upcoming G20 summit.
FT European Voice WSJ Handelsblatt
Greece calls for talks with EU and IMF on €45bn credit line;
Morgan Stanley warns of German exit from euro
The Greek government last night said it was seeking formal "consultations" with the EU and the IMF on activating the €30-€45bn bailout package agreed by eurozone leaders last weekend. Greece's Finance Minister, George Papaconstantinou, said Athens wanted to discuss "a multi-year economic policy programme with the Commission, the European Central Bank and the International Monetary Fund", according to the FT.
Meanwhile, the Telegraph reports that Morgan Stanley has warned that the Greek debt crisis is setting off a chain of events that may prompt German withdrawal from the eurozone. Joachim Fels, Head of Research, wrote in a note to clients, "Obviously, we have not reached the end game yet. However, with the latest developments, such a break-up scenario has clearly become more likely." He added that a bail-out for Greece may be necessary to avoid a crisis for Europe's financial system, but warned that it also "sows the seeds for potentially even bigger problems further down the road".
Handelsblatt comments: "For the Germans it is no longer a question of whether they must pay, but how much." FAZ argues, "How one keeps speculators in check, should be learnt by the amateurs in Brussels from the IMF in Washington. There, first the conditions for help are discussed before the money is granted. In the Eurozone, it is the opposite...The worst thing, apart from the breach of the [no bailout clause in the] Treaty is that the Greeks will only be able service maturing debts with the aid...the first aid won't be the last."
The Economist argues that the proposed €45bn rescue plan has "merely bought time--three years, in effect, to contain the adverse consequences of a possible Greek default" and that "an eventual restructuring of Greek debt remains highly likely." The article suggests Greece would require a figure closer to €75bn based on assumptions, including that the economy would start to grow again in 2013.
Irish Times WSJ Guardian Guardian 2 City AM FT FT 2 BBC EUobserver European Voice Le Figaro Mail Telegraph BBC FAZ Times Economist: Leader Economist Les Echos La Tribune Le Monde EurActiv Les Echos 2 Economist: Charlemagne WSJ: Fidler Guardian: Pratley Guardian: Elliott Handelsblatt: Comment FAZ: Comment FAZ FAZ 2 Welt Handelsblatt Reuters
Sarkozy and Berlusconi call for EU carbon tariffs
In a joint letter to Commission President Jose Manuel Barroso, Italian PM Silvio Berlusconi and French President Nicolas Sarkozy have called for trade tariffs on countries which have not signed up to a global agreement to cut greenhouse gases.
The letter argues that "a border-adjustment mechanism" is "an indispensable lever that the European Union must have the power to use if we want to preserve the environmental integrity of our efforts while ensuring the engagement of our principal partners". The Commission is due to publish a report in June assessing what the state of international talks on climate change means for the EU's climate and energy laws.
EurActiv European Voice Le Monde NouvelObs
England's cricket bat industry under threat as EU bans chemical used to treat willow
The Telegraph reports that the English cricket bat industry has claimed it is under threat following a new EU directive introduced on 19 March banning the use of a vital insecticide, methyl bromide, used for treating willow before export outside Europe. Only four Essex-based companies export English willow to the rest of the world and suppliers say their businesses could close down in three months if a solution is not found.
Telegraph Mail Express
Estonia likely to join Euro next year
EurActiv reports that the Commission has indicated that Estonia could join the Euro next year, quoting an official saying: "If nothing extraordinary happens, the Commission will give its positive opinion for the accession of Estonia to the euro zone on 12 May".
Independent: McRae EurActiv
Handelsblatt reports that MEPs have demanded to know how much the new External Action Service will cost. The financing of the service is still far from clear, after weeks of wrangling over its set-up.
The ECB has warned that imbalances in the global economy still exist and are widening, threatening to jeopardise the global recovery.
De Morgen reports that European Commissioner Olli Rehn has remarked that, apart from Greece, other countries have in the past resorted to 'currency swaps' to make their accounts look better. He mentioned Belgium, Italy and Poland, although he pointed out that at that time such transactions were allowed.
The Independent looks at the perceptions of several European politicians towards a potential Conservative victory in the UK general election.
The Parliament reports that the dispute over how France will select the two additional MEPs it receives under the Lisbon Treaty is threatening to hold up the process of appointing the 'ghost' MEPs to the European Parliament with observer status.
Euractiv reports that former Bavarian Prime Minister Edmund Stoiber is to continue his work as EU red-tape tsar until mid-2012, quoting him saying it "is a huge task" which requires "massive political commitment".
Euractiv OE research
The FT reports that Silvio Berlusconi's ruling People of Liberty party is suffering from internal difficulties, with the Party's co-founder Gianfranco Fini reportedly threatening to lead a breakaway faction.
EU President Herman Van Rompuy yesterday published a book collection of his haiku poems, named 'Haiku'.
Times Times 2 Telegraph Independent FT: Brussels blog EUobserver EurActiv European Voice
Le Figaro reports that they have begun preparing for presidential elections in Poland.
ECB board member Juergen Stark said yesterday that rising commodity prices and "strong" economic growth in Asia's emerging markets may drive up inflation in the euro area.
The Irish Times reports that the ECJ has upheld a French law that only allows an artist's heirs to benefit from resale rights, concerning the estate of Salvador Dali, despite his naming the Spanish state as the sole beneficiary of his intellectual property rights.
The clouds of ash thrown up by yesterday's volcanic eruption in Iceland are widely reported to have paralysed air travel across northern Europe.
Le Monde Le Parisien Irish Times Les Echos
The Times reports that a poll of 101 prospective parliamentary candidates shows that only 22 percent of Conservative PPCs support the EU imposed targets of generating 15 percent of Britain's energy from renewable sources by 2020, while 56 percent of Lib Dem PPCs and 71 percent of Labour PPCs support the target.
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