Wednesday, May 05, 2010

Open Europe press summary: 5 May 2010

Spanish PM forced deny he is seeking €280bn bailout as market fears spread;
Greek opposition to vote against EU-IMF bailout as political unrest intensifies
Spanish Prime Minister José Luis Rodríguez Zapatero has been forced to deny rumours that he was on the verge of seeking €280 billion in aid, after the agreed three-year €110bn Greek bailout failed to calm market fears of a eurozone sovereign debt crisis. The FT quotes him dismissing the claims as "complete insanity" and "simply intolerable".
The WSJ notes that Madrid's blue-chip IBEX 35 index fell by 5.4% and the euro dropped to its lowest level since May 2009. The FT notes that a further €600bn of debt will be issued by eurozone governments in 2010, "of which €260bn must be raised by Spain, Portugal, Italy and Ireland - the countries most at risk of failing to attract investors - this could prove to be a big danger for markets."
Le Figaro reports that German Deputy Finance Minister Steffen Kampeter declared before a Parliamentary Committee that Greece might need a figure closer to €150 billion over the next three years in order to avoid default, while Italian news agency ANSA quotes EU Monetary Affairs Commissioner Olli Rehn saying the EU will help Greece to address its financial difficulties beyond 2012, "if necessary". The Telegraph notes that German Chancellor Angela Merkel told ARD television that banks and creditors should be forced to share the costs if further rescues are ever needed, suggesting "an orderly restructuring" of debt in future.
Meanwhile, Greek daily Kathimerini reports that Antonis Samaras, Chairman of the Greek opposition New Republic, has said that his party will vote against the EU-IMF bailout package. He said, "We do not deny financial support...but we disagree with the policy that led us thus far and the government's economic strategy to address the crisis". The Guardian notes that trade unionists stormed the Acropolis yesterday in angry protests.
Le Point quotes Austrian Deputy Chancellor and Finance Minister Josef Pröll suggesting that Greece's EU partners are starting to lose patience with public and political hostility to government austerity measures: "When we see those huge demonstrations going on in Greece, we - the rest of Europe and me, I mean - are really about to lose our patience". Euractiv notes that Slovakia's PM Robert Fico has said that his country will only vote on financial aid for Greece after the June national election, insisting that Athens must make clear it is serious about spending cuts before receiving any funds.
Guardian Times FT WSJ Mail IHT FT 2 FT 3 Le Point WSJ 2 Guardian 2 Express FT 4 Kathimerini EurActiv ANSA Le Monde Le Figaro Il Sole 24 Ore Telegraph Telegraph 2 Telegraph 3 Independent Le Monde Irish Independent Irish Times Irish Times 2 WSJ 3 FT 5 WSJ: Analysis FT: Leader Handelsblatt Stern Zeit Spiegel Welt Bild
Eurozone comment round-up
In the Independent David Prosser writes, "The betting must be that this will not be the last bailout in the eurozone. The fiscal measures promised so far by Portugal and Spain do not convince. Their debt looks vulnerable to Greek-style fears. This crisis has further to run, however much Spain's politicians might seek to dismiss market gossip as madness." In the Guardian Nils Pratley argues, "When a €110bn emergency package can't even produce a 48-hour rally, events are moving too fast for comfort."
The WSJ argues that "The contentiousness of funding Greece's bailout makes any further bailouts, whether for Portugal or for Greece in a second round, look remote. Far from silencing the market speculation about Greece's fate, activating the bailout has turned up the volume." Meanwhile, the front cover of German magazine Der Spiegel carries the headline "Euroland, burned down. A continent on the way to bankruptcy".
Spiegel WSJ: Editorial Guardian: Elliott Guardian: Pratley FT: Tooze FT: Wolf Irish Independent: Williams Irish Independent: Leader Independent: Prosser
Le Monde: A European credit rating agency would not have prevented Greek crisis
Internal Market Commissioner Michel Barnier yesterday told the European Parliament that the new EU rules for credit rating agencies coming into force in December may need to be made even stricter. He also reiterated his calls for a European Credit Agency to introduce "more competition and diversity" in the sector. He said, "The power of these agencies is quite considerable not only for companies but also for states. That is why I asked for responsibility to be assumed in the work they are doing. If you look at Greece, for example, I was quite surprised by the rapid deterioration in rating". Angela Merkel echoed Barnier's calls, saying "We will press for the creation of a rating agency in Europe so that European financial markets become more stable and reactive."
An editorial in Le Monde argues, "It's hard to see how the creation of a European credit rating agency [...] would have been able to prevent the Greek crisis from breaking out. On the contrary, investors managing the world savings need truly independent advice. As the euro is under threat, it's indeed natural for European leaders to look abroad for scapegoats - especially Anglo-Saxons - instead of admitting their own mistakes and equivocations".
FT Guardian Le Monde El Mundo
Daughter of the former Bulgarian Agriculture Minister responsible for EU funding receives €700,000 in CAP funds
EUobserver reports on a study by the NGO, which reveals that €700,000 of EU Common Agricultural Policy (CAP) subsidies were given to the daughter of a former Bulgarian Agriculture Minister, Dimitar Peichev, who was responsible for the handling of EU funds until July 2009. Funds were also given to a Swedish accordion club (€59,585); a Danish billiards club (€31,515); an Estonian school alumni society (€44,884); a Dutch ice-skating club (€162,444); a Dutch amateur football club (€354,567); and the Netherland's Schipol Airport (€98,864).
George Osborne: I'm not looking for a fight with EU over AIFM Directive
In an interview with the FT, Shadow Chancellor George Osborne comments on the upcoming key negotiations on the EU's proposed AIFM Directive to regulate hedge funds, private equity groups, investment trusts and others. Negotiations between ministers will take place in May or June and are likely to constitute a potential Conservative government's first major battle in Brussels. Osborne says, "I'm not looking for a fight, I'm looking for a sensible discussion. I'm not against a properly regulated hedge fund industry, but my concern is that the directive is poorly targeted and singles out the UK." He also said that a Conservative Treasury Minister would spend "an enormous amount of time" in Brussels during the next couple of years, monitoring proposed regulation affecting the financial services sector.
WSJ WSJ: Letters FT
MEPs will only share financial data with US if the EU establishes its own body to collect data
EurActiv reports that the European Parliament's Committee on Civil Liberties (LIBE) will vote today to push forward the creation of an EU-based authority responsible for the retaining of financial data before striking any new data sharing deal with the US. "As long as we do not have our own capacity on EU soil, then there is no reciprocity," the Parliament's rapporteur, Dutch MEP Jeanine Hennis-Plasschaert (ALDE), said ahead of today's vote. Plasschaert explained that the EP will seek both to limit the scope of data transfers to the US Treasury department and to establish an EU-based authority to extract "targeted data" as soon as possible. MEPs scrapped the EU-US interim 'SWIFT' agreement on financial data sharing in February after the Lisbon Treaty gave them the power to veto international agreements.
EU Internal Market Commissioner Michel Barnier has said the introduction of the Solvency II Directive will be delayed by two months to December 31, 2012 to align the rules to the financial year of most European insurance companies. The industry remains concerned that the capital requirements provision in the Directive is excessive and that the cost will be passed on to shareholders.
The Telegraph reports that Eurostat figures suggest fewer than 300,000 Britons are working in the EU compared with just over one million of their European counterparts working here, despite Gordon Brown's previous claims that migratory flows are equal in both directions.
Telegraph Mail
IHT reports that at a meeting yesterday, EU transport ministers got closer to establishing a unified air traffic control system. They agreed to set EU safety limits for engines and aircraft, and expect to have a European air traffic manager in place before the end of the year.
IHT ABC RTVE Irish Independent
Writing in Le Figaro, former French Ambassador Henri Froment-Maurice argues that "it would be easier for President Sarkozy and his cabinet to cooperate at the EU level with a Labour-governed Britain, in spite of some divergences. However, nothing can be taken for granted at the moment".
Le Figaro Irish Times
EUobserver reports that the European Commission's Ethical Committee has authorised former Commissioner for the Internal Market Charlie McCreevy to take up a position with airline Ryanair.

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