Tuesday, July 20, 2010

Open Europe press summary: 20 July 2010



Hungary tells IMF and EU that further austerity is "out of the question";

Bundesbank says PIGS "have no choice but to reduce domestic demand"

The WSJ reports that Hungary's government has told the EU and the IMF that they are ignoring the economic risks of excessive austerity measures and that Budapest can't make deeper spending cuts. Hungary's Economy Minister, György Matolcsy, is quoted saying, "We told our partners that further austerity packages were out of the question." Hungary's currency fell sharply against the euro yesterday following the collapse of the talks.


In the Telegraph, Ambrose Evans-Pritchard argues that Hungary's revolt against the EU and the IMF "augurs ill" for Greece and other members of the eurozone, noting that austerity measures in these countries are only now starting to bite. He quotes Lars Christensen, of Danske Bank, saying, "The Greek problem is even bigger by any measure, whether budget deficit, current account or public debt." Chris Pryce, of Fitch Ratings, added, "The issue is whether they can carry the Greek people when have to make the next round of cuts in 2011."


Meanwhile, the Irish Independent notes that the German Bundesbank has criticised Ireland, Spain, Portugal and Greece for running "persistently high" current-account deficits over the past decade, which the bank says constitutes a "source of danger" for the eurozone. "The respective economies have no choice but to reduce domestic demand to a sustainable level," it added. The bank also stressed that eurozone monetary policy was aimed at securing price stability for the currency bloc as a whole. "That means, that it generally should not take consideration of the economic problems in individual states," it added.

Telegraph: Evans-Pritchard EUobserver Irish Independent WSJ IHT FT FAZ Handelsblatt FAZ 2 Focus FTD


European banks will need up to €90bn for recapitalisation after stress tests' results are published

Les Echos reports that, according to analysts' forecasts, at least 20 out of the 91 European banks to be examined will fail the stress tests and will need significant recapitalisations. Crédit Suisse estimates that European banks will have to raise up to €90bn.


Meanwhile, an editorial in the WSJ looks at the EU's banking stress tests and notes that "Monday's announcement that we will get bank-by-bank results and some insight into sovereign-debt exposure offers hope that the results released to the public will at least provide some meaningful information on the health of Europe's biggest banks."

Les Echos AFP WSJ WSJ: Editorial


La Stampa: Why establish such a huge foreign service when "there are more divergences than convergences among EU members"?

An editorial in Italian daily La Stampa on the new EU External Action Service (EEAS) and the EU's common foreign policy argues: "While everyone can see that on all the main foreign policy issues the EU has to deal with - e.g. relations with Russia, Turkey or the US - divergences among member States are more evident than convergences [...] is it really indispensable to put into motion such a huge instrument [the EEAS] before making clear its role and functions?"


Writing in the WSJ, Bill Jamieson, Executive Editor of the Scotsman, argues that "The hiring spree at the EEAS and the administrative tooling up and kitting out required for this global diplomatic leviathan could not be taking place at a worse time. It has sparked an outburst of indignation and anger as EU governments have had to embark on tough austerity programs, cutting public-sector workforces, wages and pension benefits while the institutions of the EU appear quite untouched and impervious to the fiscal pain across the Continent... The juxtaposition of fiscal austerity at government level and apparent continuing largess at EU 'head office' is causing unease even in Brussels."


Meanwhile, in an interview with the Guardian, former EU Commissioner Chris Patten considers EU policy towards the Middle East and argues that: "The default European position should not be to wait to find out what the Americans are going to do, and if the Americans don't do anything to wring our hands. We should be prepared to be more explicit in setting out Europe's objectives and doing more to try to implement them."


An article in Die Presse looks at the failure of EU foreign policy towards Syria, where it argues that the EU is suffering from a lack of political and economic credibility due to the difficulty of finding a common position.

La Stampa Presse Guardian Guardian


Commission proposes that criminal suspects be read standard EU letter of rights

Euractiv reports that EU Justice Commissioner Viviane Reding has proposed a new Directive to strengthen the rights of suspects in criminal cases in all EU countries, which would see police forces obligated to inform the accused of his rights in writing in his own language at the time of arrest. The standard letter of rights would read: "You have the right to be informed of what offence you are suspected; to the assistance of a lawyer; to an interpreter and translation of documents [and] to know for how long you can be detained," according to the Commission's draft proposal. Such a letter already exists in 12 member states, with six other states providing oral information. Commissioner Reding will propose a standard format to be used in all 27 member states to be translated into all the EU's official languages, with some flexibility on the exact wording in each member state.

EurActiv Europolitics Stern


An article in Süddeutsche Zeitung reports on the EU 2011 budget negotiations, criticising the Commission's proposal to increase administrative costs by more than 4 percent to €8.2 billion. German MEP Ingeborg Gräßle, who sits in the European Parliament's Committee on Budgets, is quoted saying: "the Commission asks states to look into prolonging the working life of its citizens, while it keeps sending its own employees into retirement early."

Sueddeutsche IHT WSJ: Jamieson OE blog


Royal College of Surgeons: EU law on doctors' working hours must be changed to safeguard patient care

In a letter to the Telegraph, the President of the Royal College of Surgeons, John Black, writes that "dangerously low levels of medical cover, brought on by the EU's Working Time Directive", have raised demand for foreign doctors. However, requiring foreign medical professionals to sit language exams would breach European law on the freedom of movement of individuals within the European Economic Area. He continues to note that "language testing is not the only area where British legislation is needed".

Telegraph: Letters OE Research


Irish Parliament recommends increased scrutiny of EU legislation

EurActiv reports that the Irish Parliament's Joint Committee on European Scrutiny has recommended that a more robust system of legislative scrutiny over EU proposals be introduced, whereby all ministers will pledge that - bar certain exceptional circumstances - they will not agree to anything in the EU Council of Ministers until it has been cleared by the Irish Parliament. The article notes that the system is very similar to that which currently operates in the UK Parliament.



EU leaders pushing Switzerland for closer association

In a meeting with Swiss President Doris Leuthard, EU President Herman Van Rompuy and Commission President José Manuel Barroso have been pushing for a more efficient partnership between Switzerland and the EU, reports Die Presse. Sources from Brussels say the EU wants to make the 120 bilateral agreements with Switzerland 'easier to manage,' this could mean that Switzerland would automatically adopt EU legislation in certain areas.

Presse Presse 2 Le Monde Le Monde 2


Le Figaro reports that a two-day stakeholders' debate on future reforms of the EU's Common Agricultural Policy (CAP) is taking place in Brussels. The article suggests that "the most insidious discussions will concern European solidarity. CAP redistributes revenues. In times of thin cows, the transfer of billions of euros of public money from one country to another could turn out to be highly controversial. All the more so when Germany is the main contributor".

Le Figaro


In the FT Deutschland, MEP Manfred Weber criticises the EU's proposals for the harmonisation of asylum policy which could see the process of asylum application sped up, with increased legal and social care resources, saying: "Our aim should be to protect the victims quickly and effectively, and not to encourage the abuse of the asylum law."

FT Deutschland


The Independent reports that an advisory group of imams and rabbis have accused the EU of "naked discrimination" by ordering the compulsory labelling of all kosher and halal meat, while not requiring the identification of conventional methods of slaughter.



EurActiv reports on a leaked paper by MEPs, suggesting that the Citizens' Initiative threshold should be scrapped, just a few months after being adopted. The current threshold requires a petition of 100,000 signatures, before a proposal for new legislation will be considered. MEPs want to scrap this to make the system more accessible. The Commission have dismissed such plans as "impractical".



Europolitics reports that six EU member states, including France, Spain and Italy, have asked the European Commission for early payment of direct agricultural subsidies for 2010, which was due to be paid in October. The Commission intends to issue its decision on a case-by-case basis by the end of the summer.



The Mail reports that the Conservative election pledge to scrap unpopular fortnightly bin collections is unlikely to materialise, due to stringent EU recycling targets and hefty potential fines for noncompliance.



EU-Info Deutschland reports that the economic wing of the Christian Democratic Union party (CDU) has rejected criticism of Germany's export surplus. Kurt Lauk, the President of the CDU Economic Council said: "With the ongoing criticism of German export strength, the EU is in danger of going down a dangerous wrong path".

EU-Info Deutschland


Máire Geoghegan-Quinn, European Commissioner for Research, has announced that €6.4 billion will be spent on research and development in 2011 - a 12 percent increase on 2010.

Irish Times EUobserver European Voice Zeit Dagens Nyheter


The Register reports that Swedish Pirate Party MEP Christian Engstrom yesterday abandoned a meeting with the Anti-Counterfeiting Trade Agreement (ACTA) EU negotiators in the European Parliament after he was forbidden from sharing any information received there with the public. The meeting was scheduled in order to update MEPs on the state of play of negotiations after the last round of talks in Switzerland.

The Register


Les Echos reports that, according to new IMF forecasts, Slovakia's public deficit will reach up to 7-8 percent of GDP by the end of 2010. It was initially estimated to be at 5.5 percent.

Les Echos


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