Wednesday, February 17, 2010

Open Europe press summary: 17 February 2010

On Tuesday 23 February Open Europe is holding an event in Brussels from 5 - 6.30pm, entitled "Is the EU a threat to civil liberties?" Speaking at the event will be: Jonathan Faull, Director General of the European Commission's Justice, Freedom and Security department; Tony Bunyan, Director of EU civil liberties organisation Statewatch; and Cornelia Ernst, MEP for Germany and member of the EP's Civil Liberties Committee (GUE/NGL Group).
Places are limited. If you would like to attend, please RSVP to Pieter Cleppe at or Tel: 00 32 2 540 86 25.
Greece stripped of EU vote on additional budget austerity measures
The Telegraph reports that EU finance ministers have stripped Greece of its vote at the next meeting of the ministers on 16 March, with the article describing it as "the worst humiliation ever suffered by an EU member state." Finance ministers will review a progress report on Greece's measures to bring its deficit under control, and decide at the meeting whether or not Greece needs to introduce additional austerity measures. The article reports that, in effect, this means Greece will lose control over its tax and spend policies, and the EU will itself impose cuts under Article 126.9 of the Lisbon Treaty.
Europolitics reports that formal plans for a system of EU 'economic governance' are due by June, noting that the proposals to be issued by Economic and Monetary Affairs Commissioner Olli Rehn will be based on Article 136 of the Lisbon Treaty, which allows eurozone members extra scrutiny over their counterparts' budgets and the power to lay down "economic policy guidelines" for each other.
Swedish Finance Minister Anders Borg said after the finance ministers' meeting: "This is quite an urgent situation. What we have seen so far is not enough. We need more steps when it comes to taxes and expenditure if the Greeks want to build credibility in the market." Deputy German Finance Minister Joerg Asmussen also said that "Additional measures by Greece are needed". The Irish Times reports that Irish Finance Minister Brian Lenihan said of next month's meeting: "The [Irish] Government would certainly attach considerable weight to the recommendation of the commission in any such vote".
The Mail looks at Mr Borg's comments that non-eurozone member states could still contribute to an EU bailout of Greece, despite UK Chancellor Alistair Darling's insistence that any bailout would primarily be an issue for eurozone countries. Open Europe Director Mats Persson is quoted saying: "While it's in no one's interest for Greece to go bust, British taxpayers simply won't accept being forced to pay for the mistakes of a government which they could never vote out of office. This is wholly undemocratic and shows the folly of the eurozone experiment in the first place. A much better solution would be to let the IMF bail out Greece." Mats was also interviewed on Swedish Radio, discussing the political consequences of the crisis in Greece.
The FT reports that Luxembourg PM Jean-Claude Juncker, who heads the eurozone finance ministers' group, indicated that financial assistance for Greece, if it materialised, would probably take the form of bilateral loans or guarantees from individual governments.
Writing in the FT Martin Feldstein, Professor of Economics at Harvard, argues: "temporary financial patches will not deal with the real problem" and proposes that a solution could be: "The rest of the eurozone could allow Greece to take a temporary leave of absence with the right and the obligation to return at a more competitive exchange rate." He adds, "The European economic and monetary union is doubly flawed" since it "forces diverse countries to live with a single interest rate and exchange rate that cannot be appropriate for all members."
Writing in Le Figaro columnist Yves de Kerdrel argues that the "problem isn't Greece, it is the euro". Meanwhile, Hans Eichel, who was German Finance Minister when Greece adopted the Euro, says in Focus that the "Euro entry of Greece was a mistake".
Yesterday, customs officials in Greece went on strike, and elsewhere a bomb exploded outside the Athens office of JP Morgan, causing no reported injuries.
WSJ Mail Mail 2 Guardian Guardian: Letters Telegraph AFP FT Irish Times: McArdle Irish Times: Leader Irish Times City AM BBC European Voice EurActiv FT: Feldstein Telegraph: Tebbit blog Swedish Radio WSJ: Lewis Independent Wall Street Italia Il Sole 24 Ore Il Sole 24 Ore 2 Europolitics Open Europe research Open Europe press release
French Foreign Minister: Franco-German policy should lead drive towards common EU defence
When asked in an interview with German magazine Focus whether Germany and France want to be the leaders in Europe, French Foreign Minister Bernard Kouchner replied: "'Leaders' isn't the right word, but pioneers, yes. There are two ways to build Europe, the first along the lines of: we come to an agreement - after endless negotiations - on the smallest common denominator. But that's not how we take things forward! Angela Merkel and Nicolas Sarkozy have rightly decided to adopt a more resolute approach. This has nothing to do with an ambition to lead, but it's a necessary way of proceeding to get things moving."
Asked what Franco-German leadership should lead to, Kouchner answered: "common defence - this is what's still really lacking. A strategy allowing us gradually to achieve a Franco-German security policy would be fantastic, but, of course, only as a forerunner to a European defence strategy. What would be very simple and very important [would be to have] a committee of European defence ministers at the Foreign Affairs Council. It would be politically symbolic. But in Europe, everything is very complicated..."
France Diplomatie
EU spends €200 million a year buying up African fishing grounds
Belgian daily Het Laatste Nieuws reports that the EU has spent about €200 million a year buying fishing rights predominantly along Africa's shores, causing fish stocks to halve in 30 years. The article notes that the increasing flow of Western African refugees to Europe and the increase in piracy are consequences of the EU's fishing policy.
Barnier issues warning on EU bank pay and bonuses
The FT reports that the new EU Internal Market Commissioner, Michel Barnier, has given his strongest indication yet that targeting bankers' pay and bonuses will be a key priority for him as Commissioner. Speaking to finance ministers in Brussels yesterday, the Frenchman declared, "We need strong corporate governance," going on to say: "I'm convinced that binding rules on remuneration...would be an incentive for taking less risk."
Commission gives Greece three days to explain details of debt concealment
The Times reports that the Commission has given Greece three days to disclose how it has used complex financial deals to conceal the true size of its public debt or it will take Greece to the European Court of Justice, under threat of daily fines. EU Economic Affairs Commissioner Olli Rehn said yesterday that he was not aware of similar issues with other EU countries swapping debt for loans that could be kept off the books in derivatives, but that "this has still to be verified".
A leader in the FT argues: "if Greece broke the spirit of the rules, it was with the connivance of others. Brussels and eurogroup members must have known and accepted what was going on...this cannot be blamed solely on the Greeks. It is a European failure."
The Guardian reports that the European Parliament has urged EU authorities to investigate the role of Goldman Sachs and other investment banks in contracts that helped inflate Greece's public debt.
Focus Times Times 2 FT: Analysis FT: Leader EUobserver Guardian IHT El Pais AFP WSJ WSJ 2
Restrictions on offshore funds in AIFM Directive risks protectionism
City AM reports a clause inserted into the EU's AIFM Directive by the Spanish EU Presidency would limit the ability of hedge funds from places like Asia or North America to market their services to EU customers such as pension funds. AIMA Chief Executive Andrew Baker said: "The practical consequence would be that the EU market would be closed to non-EU funds and managers, with obvious protectionist implications... Any restrictions imposed on European investors would also hit asset managers in financial centres [elsewhere]."
City AM Open Europe research
A new report by the pan-European party EU Democrats comparing election turnout for the European Parliament elections with all other elections and referendums in the EU in the period 1979-2009 has found that turnout was lowest for the EP elections.
EUD Press Release EUD Report
Appointment of Portuguese ECB Vice-President clears the way for German to take Presidency
According to Le Monde, the appointment of Victor Constâncio as ECB Vice-President yesterday has cleared the way for Axel Weber, President of the Bundesbank, to assume the Presidency of the ECB in November 2011. However, a German leading the ECB in Frankfurt is likely to prove unpopular with many eurozone governments.
Le Monde Coulisses de Bruxelles EUobserver FT
The Irish Independent reports that farmers are set to receive 86% of all EU funds destined for Ireland between 2007 and 2013.
Irish Independent
An editorial in the WSJ looks at the European Parliament's recent vote to block an EU-US anti-terrorism data-sharing deal, arguing: "While pretending to stand on principle, the Parliament was flexing new muscles under last year's Lisbon Treaty - while also indulging anti-American reflex. Previously, the Parliament did not have the power to approve agreements on internal security."
WSJ: Editorial
Taner Yildaz, the Turkish Minister of Energy, writing in Eurasia magazine, argues for Turkish EU membership, citing the geostrategic importance of Turkey to the EU in terms of energy diversification.
Eurasia Critic European Voice Eurasia Critic 2
Thorbjørn Jagland, Secretary-General of the Council of Europe, is quoted in European Voice  today saying that the EU will face complicated talks in its bid to become a member of the European Convention on Human Rights, as desired by the Lisbon Treaty.
European Voice
Italy has accused Switzerland of misusing the Schengen agreement, facilitating European travel, to put diplomatic pressure on Libya, which in turn has prompted a Libyan ban on visas for much of Europe. "It is not right that Schengen should be twisted by Switzerland into a means of exerting pressure: there are other ways of resolving the bilateral problem with Libya", Italian Foreign Minister Franco Frattini said.
Reuters UK La Stampa
The Times reports that the EU member states are considering plans for a shared nuclear waste facility in eastern Europe.
Seven European governments, including the UK, have offered €3.5bn to support the struggling A400 project of the European Aeronautic Defence and Space Company (EADS) in return for a share of future profits. The A400 project is one of Europe's largest defence projects.
EurActiv reports that the European Commission will recommend that the EU begin accession talks with Iceland next week.
In response to a question from Austrian daily Der Standard, Kosovan Foreign Minister Skender Hyseni has said he is optimistic that Kosovo will join the EU before 2020. Catherine Ashton, who will visit the region today, has described the Balkans as a "priority for EU foreign policy."
EUobserver Comment is Free: Bancroft Le Figaro Coulisses de Bruxelles
Reuters reports that the EU has renewed its sanctions on Zimbabwe for another 12 months due to "lack of progress in implementing a power-sharing accord."
Telegraph Reuters

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