Monday, November 08, 2010

Open Europe press summary: 8 November 2010


Rehn visits Dublin as analysts warn that Irish debt is at risk from "buyers' strike";
Irish economics professor: "We are no longer a sovereign nation in any meaningful sense"
The Irish Times reports that EU Economic and Monetary Affairs Commissioner Olli Rehn will arrive in Dublin later today to hold meetings with Irish Finance Minister Brian Lenihan and the opposition parties to discuss the government's proposed budget cuts for 2011. Bloomberg quotes Jens Peter Soerensen, Chief Analyst at Danske Bank, a primary dealer in Irish government bonds, saying that "It's close to a buyers' strike at this point."

Writing in the Irish Times, Professor of Economics at University College Dublin Morgan Kelly argues, "By next year Ireland will have run out of cash, and the terms of a formal bailout will have to be agreed. Our bill will be totted up and presented to us, along with terms for repayment. On these terms hangs our future as a nation." He concludes, "Sovereign nations get to make policy choices, and we are no longer a sovereign nation in any meaningful sense of that term."

Meanwhile, the FT reports that, following a visit to Lisbon, Chinese President Hu Jintao has pledged "concrete measures" to help Portugal, with support that is expected to include purchases of Portuguese government debt.

Bloomberg quotes Nick Kounis, head of macro research at ABN Amro Bank, saying that the eurozone's uniform monetary policy is threatening recovery in the periphery countries. "The periphery would be happy to have the Fed as their central bank at the moment," he said.

Reuters reports that Eurogroup Chairman Jean-Claude Juncker has said that he will put forward a new proposal for a common euro bond as a way to make "weaker euro countries attractive for investors in the future." Handelsblatt reports that over the weekend German Finance Minister Wolfgang Schäuble has said that a new insolvency mechanism would not relate to old debts, but only to new loans. "If a country falls into financial difficulty the EU would set a savings and restructuring program in motion, as in the case of Greece", he said.

Greek socialists win local polls and drop election threat
With more than 50% of the votes counted, Socialist candidates, in the governing Pasok party, were on track to win in seven of Greece's 13 electoral regions, reports the WSJ. Pasok won control of all 13 regions at national elections 13 months ago. The FT notes that PM George Papandreou has backed off from his threat to call a snap general election, in spite of losses for his socialist party in local elections on Sunday night, which he had described as a 'referendum' on his government's austerity measures.

Debate over new Europe Bill could spark backbench revolt
William Hague, UK Foreign Secretary, has said the Coalition will reject the demands of Conservative MPs to call a referendum on proposed changes to the EU's treaties, echoing the statement made by Deputy Prime Minister Nick Clegg last week.

The move could spark a backbench rebellion, as on Thursday, MPs are due to vote on the new 'Europe Bill', setting out promises to hold a referendum on any transfer of power from Westminister to Brussels. The Telegraph notes that Conservative MPs may attempt to amend or even reject the motion, leaving ministers facing an open revolt. On Wednesday, the Commons will debate other recent EU initiatives including greateer supervision of national budgets.

Commission claims back €578m of unduly spent CAP funds
The Commission has announced it will claim back €578m of unduly spent CAP funds from 19 member states. "This money returns to the EU budget because of non-compliance with EU rules or inadequate control procedures on agricultural expenditure", notes the press release.

Meanwhile, Open Europe's Pieter Cleppe was interviewed on the BBC's Record Europe programme commenting on Transparency International's report on corruption in the EU. Pieter argued: "The solution lies partly with the EU being more modest and not spending so much money when it knows that it will be subject to fraud and waste".

EU officials running brothels have been allowed to keep their jobs
Internal disciplinary records of the European Commission seen by the Sunday Times show that three serving Commission staff have been allowed to keep their jobs after they were discovered to be profiting from prostitution. The documents also reveal that EU officials accused of drink-driving and fighting within the Commission's buildings have been punished with no more than an official reprimand. Conservative MEP Roger Helmer - who obtained the files - was quoted saying: "These cases show that officials can commit almost any criminal offence or break any rule and get away with a slap on the wrist when other employees would get the sack."    

EU biofuel target could cause up to 73 million tonnes CO2 emissions per year
European Voice reports on a study by nine environmental lobby groups showing that an area twice the size of Belgium could be converted into fields and plantations by 2020 in order to meet EU targets on biofuels. The report warns that land-use change on such large scale could cause up to 73 million tonnes of CO2 emissions each year - the equivalent of putting around 26 million new cars on the road by 2020.      

In an interview with the FT, Polish Foreign Minister Radoslaw Sikorski has rejected the idea of creating an informal G6 of the EU's largest members as a means to restrain Franco-German dominance. "I would be wary of any formal division of countries into categories. We have enough such distinctions already and they make life difficult", he argued.

In an interview with the WSJ, EU Commissioner Neelie Kroes has said that she wants to create a Europe-wide one-stop shop to collect and distribute copyright payments for artists across the EU, rather than on a country-by-country basis.

ORF reports that European interior ministers will be meeting today to discuss better protection measures against postal bombs. They will also discuss the possibility of introducing a European control agency for pan-European mail.

According to a leaked EU report seen by the Mail, 50,000 workers from India will be issued work permits as part of a special EU-India deal.

The Sunday Times reported on research revealing that, since 2000, at least £30 million of EU subsidies have been used to build fishing vessels which routinely breach bluefin tuna fishing quotas, pushing the species to the brink of extinction.

An article in Die Presse outlines Italian plan to expel EU citizens if they do not comply with "Italian standards." Berlusconi's plans, include an outline for reducing prostitution, immigrant and crime levels.

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