New EC Thread
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Re: New EC Thread
Panda Fri 16 Nov - 9:19
International Herald Tribune, Gazeta Wyborcza, Público & 4 others
European Union
A wave of protests across Europe
Several hundred thousand people demonstrated in 23 European countries in response to trade unions’ call for a day of coordinated protests against austerity measures to address the economic crisis. General strikes were announced in both Spain and Portugal. Original article in International Herald TribuneenLink
International Herald Tribune Paris
EU budget
Merkel won’t cut off our money
Meeting the Polish PM Donald Tusk in Berlin, German Chancellor Angela Merkel suggested that Poland will not lose much as a result of the expected cuts in the new EU budget for the years 2014-2020. The two leaders agreed to work together to avoid a fiasco at the 22-23 November EU summit, but they did not talk about concrete amounts, notes the daily. Original article in Gazeta WyborczaplLink
Gazeta Wyborcza Warsaw
EU budget
Portugal risks losing €4.5 billion in EU funds
The new proposal for 2014-2020 EU budget aggravates the cuts in the funding of the EU27. Portugal will probably suffer cuts of 4.5 billion euros in structural funds to support poorer regions and in agriculture aid. Quoting a EU source, the daily says that "the damage could be even bigger because the new proposed cuts affect particularly some of the traditional Portuguese cultures, such as wine, fruit and vegetables, along with the aid to outermost regions which include the Azores and Madeira". Original article in PúblicoptLink
Público Lisbon
Ireland
Public inquiry demanded into death of woman refused abortion
The death on October 28th of a 17 weeks pregnant woman who was refused an abortion has reignited the debate over Ireland's near-total ban of the procedure. 31-year-old Savita Halappanavar had asked several times for her pregnancy to be terminated because she was miscarrying. She was refused because there was a fetal heartbeat. According to her husband, doctors informed her that Ireland was "a Catholic country." In Dublin more than a thousand people staged a demonstration outside the Irish parliament. Original article in The Irish TimesenLink
The Irish Times Dublin
European Union
40% women
The European Commission has presented a draft directive that will impose a 40% quota for women on corporate boards of directors by 2018 for public companies and 2020 for private publicly quoted companies. In Germany, both the political and business communities are opposed to the measure. Link
Frankfurter Rundschau Frankfurt
Netherlands
Large public service salaries are reined in
Starting in January 2013, salaries in the Dutch public and semi-public sector will no longer be allowed to exceed 228,599 euros per year, which is 30% more than government ministers are paid. The law voted by the Upper House will concern 700 high-level executives in administration, public health, health insurance companies and housing organisations. In the future, it may be extended to include other professions such as doctors and public television presenters. Original article in De VolkskrantnlLink
De Volkskrant Amsterdam
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Re: New EC Thread
Panda Fri 16 Nov - 16:39
Debate
How to preserve the European miracle
13 November 2012Dagens Arena Stockholm
Shared 241 times in 10 languages
Dergachov
The crisis might be undermining the EU project, but a journey through the former “bloodlands” of Europe’s historical wars reminds us of what the Union has done for the continent, writes a Swedish journalist. If we want to make sure that democracy doesn't perish again, we mustn't shirk from getting citizens involved in the political life of the EU. Excerpts.
Per Wirtén
We travelled through the eastern parts of the EU this summer. From Vilnius to Bialystok and then following the border towards Belarus and Ukraine, admiring beautiful squares in small East Slovak cities and continued on to Romania.
It was overwhelming. I had visited many of the cities and regions we passed by before, but that was just after the fall of communism some 20 years ago. What I was witnessing now was a social, economic and political miracle. The changes can only be compared with the record years in western Europe between 1945 and 1970. But while the recovery in western Europe was dependent on the US, eastern Europe has risen on account of the EU’s own power.
Reports from Paris, Brussels and Berlin about new crisis meetings to save the euro kept on coming as we travelled. But during warm evenings on the square in Prešov, the crisis felt both distant and embedded in another course of events. It was like I needed to transport myself to the geographical outskirts of the Union, in order to see the full picture.
The European obscurity has become paralysing. Who understands the direction in which politics is going, where the EU is heading? All the important political standpoints and decisions are taken behind closed doors. The euro crisis leads inevitably to the question of Europe and democracy.
You become a European in Auschwitz
Who can still avoid thinking of the prelude to the outbreak of the war in 1914? Nobody understood the point of a war, nobody wanted it, but nobody managed to leave national prestige behind in order to prevent it. A similar pattern has returned in the game about the euro. Every time the European Parliament and the European Commission put forward a policy proposal suggesting common responsibility – eurobonds for example – the heads of governments stop them. Privileged countries such as Germany, Finland and Sweden look after their interests in conservative self-deception. They are driving the continent – and themselves – towards the abyss.
Our summer journey developed into a European pilgrimage. We explored the outskirts of the big regions that historian Timothy Snyder has called Europe’s “Bloodlands” or “Killing fields”: the geographical centre of Nazi and communist genocides where twelve million human beings were killed between 1933 and 1944.
It was a journey that became a reminder of the fact that the European project was not born in naïve euphoria but because of the fear of what the continent had brought about. When you see tourists flocking to empty synagogues in Prague, Krakow and other cities, you realise that a European self-consciousness – founded on historical gravity – is assuming a more definite shape. You become a European in Auschwitz.
The EU has been tormented by an evident crisis of legitimacy for two decades. Since Denmark voted no to the Maastricht treaty in 1992, the barest idea of alteration has provoked demands for new referendums. The “Non and Nee” in France and the Netherlands [in 2005’s referendum on the European constitution] were the most important upsets.
The political elites have always regarded the demands for referendums as a curse. But they should interpret them as a breakthrough for the European project. Finally the people of Europe wanted to have a say in important, shared matters. The commitment revealed that the political debate in Europe had become... European.
Why do politicians seem to regard the basic principles of democracy as self-evident on the national level, but threatening on the European level? Their main argument is that a European people have not yet appeared in a common, political and public sphere – a so-called demos. Without such a demos, democracy is only a chimera.
The euro crisis and the question of democracy
The Swedish Social Democrat Carl Tham formulated the argument in an article this summer: “a living and democratic political union can only be created in a situation when the European people feel a strong sense of belonging and solidarity with each other, when they think of themselves as part of a European people and have confidence in the political institutions.”
But isn’t this very common conclusion built on a misconception? It is highly doubtful that a “strong sense of belonging and solidarity” existed in the different nation states when the major democratic breakthroughs occurred in the beginning of the 20th century. “Confidence in the political institutions” certainly did not exist, and there was no widespread political and public sphere.
A debate about the deceit of intellectuals began a year ago: where were they when the European project was about to implode? Many of the contributions to the debate were published on the impressive site Eurozine. But the absence of an outspoken debate and explicit standpoints from Europe’s politicians is in reality more alarming.
So it was elevating to read an editorial by Gerhard Schröder in the New York Times this spring. An influential politician who saw the connection between the euro crisis and the question of democracy, Schröder summed it up in three points: The European Commission must be developed into a government elected by the European Parliament. The European Council – the heads of states – must abandon power and be transformed into an upper chamber with a similar role to the Bundesrat in Germany.
People proved to be sensible
One doesn’t have to agree with all of Schröder’s proposals. But he is suggesting a direction towards a possible European democracy. This can, of course, be criticised as an attempt to impose democracy “from above” – but it can also be regarded as an acknowledgement of the challenge posed by Europe’s citizens during the last 20 years.
The square in Krakow is one of the most magnificent on the continent. In the bell tower of the cathedral, the passing of time is marked by a man with a trumpet. History throws long shadows. It is a good spot to observe Europe. Here you can reflect on the political miracle, the new prosperity and civilised democracy.
Many Europeans in the west feared chaos when the dictatorships of the east fell. They were wrong. People proved to be sensible. That should instill hope and confidence. But only 30 minutes by car from the square you will find the foremost reminder of the fear of Europe’s darkness that brought about the European project – the Auschwitz-Birkenau concentration camps.
Democracy must always be widened. It will be thrust back as soon as you settle down in comfort. In the autumn of 1940, when the situation in Europe was at its darkest, the Swedish feminist Elin Wägner compared ideals to bicycle lights: they don’t light up until you pedal forwards.
The social-democratic mission in Europe in the autumn of 2012 can easily be summarised by Wägner’s metaphor and two words: democratise and politicise.
==============================
Why can't it be a Trade and Defense agreement.? It's obvious the Southern Countries have different attitudes to the Northern Countries.and they would be better off managing their own Finances. Even if it is agreed to lend Greece the E31.5 billion , how are they going to repay it.?
How to preserve the European miracle
13 November 2012Dagens Arena Stockholm
- Comment41
Shared 241 times in 10 languages
Dergachov
The crisis might be undermining the EU project, but a journey through the former “bloodlands” of Europe’s historical wars reminds us of what the Union has done for the continent, writes a Swedish journalist. If we want to make sure that democracy doesn't perish again, we mustn't shirk from getting citizens involved in the political life of the EU. Excerpts.
Per Wirtén
We travelled through the eastern parts of the EU this summer. From Vilnius to Bialystok and then following the border towards Belarus and Ukraine, admiring beautiful squares in small East Slovak cities and continued on to Romania.
It was overwhelming. I had visited many of the cities and regions we passed by before, but that was just after the fall of communism some 20 years ago. What I was witnessing now was a social, economic and political miracle. The changes can only be compared with the record years in western Europe between 1945 and 1970. But while the recovery in western Europe was dependent on the US, eastern Europe has risen on account of the EU’s own power.
Reports from Paris, Brussels and Berlin about new crisis meetings to save the euro kept on coming as we travelled. But during warm evenings on the square in Prešov, the crisis felt both distant and embedded in another course of events. It was like I needed to transport myself to the geographical outskirts of the Union, in order to see the full picture.
The European obscurity has become paralysing. Who understands the direction in which politics is going, where the EU is heading? All the important political standpoints and decisions are taken behind closed doors. The euro crisis leads inevitably to the question of Europe and democracy.
You become a European in Auschwitz
Who can still avoid thinking of the prelude to the outbreak of the war in 1914? Nobody understood the point of a war, nobody wanted it, but nobody managed to leave national prestige behind in order to prevent it. A similar pattern has returned in the game about the euro. Every time the European Parliament and the European Commission put forward a policy proposal suggesting common responsibility – eurobonds for example – the heads of governments stop them. Privileged countries such as Germany, Finland and Sweden look after their interests in conservative self-deception. They are driving the continent – and themselves – towards the abyss.
Our summer journey developed into a European pilgrimage. We explored the outskirts of the big regions that historian Timothy Snyder has called Europe’s “Bloodlands” or “Killing fields”: the geographical centre of Nazi and communist genocides where twelve million human beings were killed between 1933 and 1944.
It was a journey that became a reminder of the fact that the European project was not born in naïve euphoria but because of the fear of what the continent had brought about. When you see tourists flocking to empty synagogues in Prague, Krakow and other cities, you realise that a European self-consciousness – founded on historical gravity – is assuming a more definite shape. You become a European in Auschwitz.
The EU has been tormented by an evident crisis of legitimacy for two decades. Since Denmark voted no to the Maastricht treaty in 1992, the barest idea of alteration has provoked demands for new referendums. The “Non and Nee” in France and the Netherlands [in 2005’s referendum on the European constitution] were the most important upsets.
The political elites have always regarded the demands for referendums as a curse. But they should interpret them as a breakthrough for the European project. Finally the people of Europe wanted to have a say in important, shared matters. The commitment revealed that the political debate in Europe had become... European.
Why do politicians seem to regard the basic principles of democracy as self-evident on the national level, but threatening on the European level? Their main argument is that a European people have not yet appeared in a common, political and public sphere – a so-called demos. Without such a demos, democracy is only a chimera.
The euro crisis and the question of democracy
The Swedish Social Democrat Carl Tham formulated the argument in an article this summer: “a living and democratic political union can only be created in a situation when the European people feel a strong sense of belonging and solidarity with each other, when they think of themselves as part of a European people and have confidence in the political institutions.”
But isn’t this very common conclusion built on a misconception? It is highly doubtful that a “strong sense of belonging and solidarity” existed in the different nation states when the major democratic breakthroughs occurred in the beginning of the 20th century. “Confidence in the political institutions” certainly did not exist, and there was no widespread political and public sphere.
A debate about the deceit of intellectuals began a year ago: where were they when the European project was about to implode? Many of the contributions to the debate were published on the impressive site Eurozine. But the absence of an outspoken debate and explicit standpoints from Europe’s politicians is in reality more alarming.
So it was elevating to read an editorial by Gerhard Schröder in the New York Times this spring. An influential politician who saw the connection between the euro crisis and the question of democracy, Schröder summed it up in three points: The European Commission must be developed into a government elected by the European Parliament. The European Council – the heads of states – must abandon power and be transformed into an upper chamber with a similar role to the Bundesrat in Germany.
People proved to be sensible
One doesn’t have to agree with all of Schröder’s proposals. But he is suggesting a direction towards a possible European democracy. This can, of course, be criticised as an attempt to impose democracy “from above” – but it can also be regarded as an acknowledgement of the challenge posed by Europe’s citizens during the last 20 years.
The square in Krakow is one of the most magnificent on the continent. In the bell tower of the cathedral, the passing of time is marked by a man with a trumpet. History throws long shadows. It is a good spot to observe Europe. Here you can reflect on the political miracle, the new prosperity and civilised democracy.
Many Europeans in the west feared chaos when the dictatorships of the east fell. They were wrong. People proved to be sensible. That should instill hope and confidence. But only 30 minutes by car from the square you will find the foremost reminder of the fear of Europe’s darkness that brought about the European project – the Auschwitz-Birkenau concentration camps.
Democracy must always be widened. It will be thrust back as soon as you settle down in comfort. In the autumn of 1940, when the situation in Europe was at its darkest, the Swedish feminist Elin Wägner compared ideals to bicycle lights: they don’t light up until you pedal forwards.
The social-democratic mission in Europe in the autumn of 2012 can easily be summarised by Wägner’s metaphor and two words: democratise and politicise.
==============================
Why can't it be a Trade and Defense agreement.? It's obvious the Southern Countries have different attitudes to the Northern Countries.and they would be better off managing their own Finances. Even if it is agreed to lend Greece the E31.5 billion , how are they going to repay it.?
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Re: New EC Thread
Panda Sat 17 Nov - 8:42
Pressure on Cameron to block EU army HQ plans
David Cameron faces a looming political battle to defend Britain's veto over defence policy after France, Germany, Spain, Italy and Poland urged the creation of a new European Union military command "structure".
Prime Minister David Cameron gives a press conference after the EU head of states council meeting in Brussels Photo: EPA/OLIVIER HOSLET
By Bruno Waterfield, Brussels
3:23PM GMT 16 Nov 2012
354 Comments
The powerful group of countries, Europe's largest, also welcomed plans to hold a special Brussels summit next year to "confirm our ambitions for security and defence policy" in a move that poses a major headache for the Prime Minister as the EU climbs the domestic political agenda.
Known as the "Weimar group", the five countries met in Paris on Thursday evening to launch a new offensive to create an EU military operations headquarters, after Britain used its veto last year to block similar proposals.
"We are convinced that the EU must set up, within a framework yet to-be-defined, true civilian-military structures to plan and conduct missions and operations," the group of countries said in a communique. "We should show preparedness to hold available, train, deploy and sustain in theatre the necessary civilian and military means."
Earlier this week, The Daily Telegraph revealed that Lady Ashton, the EU foreign minister, has signalled to Paris that she could help defeat Britain over the HQ if France could win other allies, an alliance that has now been sealed among the five countries.
France, Germany, Italy, Spain and Poland see the launch of EU civil-military missions, in Somalia, Mali, Libya, Kosovo, Georgia and Afghanistan, as a means to build momentum for a permanent EU command structure to oversee a growing number of operations.
Britain is isolated after it blocked moves, led by France, last year to create an EU Operational HQ (OHQ) because of concerns, said to be shared by the United States, that it would rival and divide Nato command.
"Rather than the rather sterile debate about costly new structures, most EU member states are now focused on developing European capabilities, making EU missions and operations more effective and ensuring our response to conflict situations reflects a genuinely comprehensive approach," said a government spokesman
"We would continue to oppose the establishment of an EU operational headquarters."
In September this year, a "futures" group of 11 countries, including the Weimar five, called for an end to Britain's veto over defence policy to stop it blocking the OHQ, which is envisaged as a structure that "could eventually involve a European army".
The proposals will be debated, with the support of Lady Ashton, the EU's High Representative for foreign affairs, at a special summit in December 2013 ahead a push towards a new European constitution in the summer of 2014.
"This initiative should receive adequate political support at high level, in close cooperation with the High Representative, and result in increased European political integration. In defence matters as well, we need more Europe. We are committed to working together in this direction," said the group's statement.
Geoffrey Van Orden MEP, the Conservative spokesman on European defence and security policy, warned that demand to set up an OHQ is "central to the federalist aims of the Weimar group".
"This is all to do with creating a European Federation," he said. "The aim of Germany and France is to establish a fully-fledged EU military capability that will further cement European political integration and strengthen their ambition for the EU to be a state-like player on the international stage."
David Cameron faces a looming political battle to defend Britain's veto over defence policy after France, Germany, Spain, Italy and Poland urged the creation of a new European Union military command "structure".
Prime Minister David Cameron gives a press conference after the EU head of states council meeting in Brussels Photo: EPA/OLIVIER HOSLET
By Bruno Waterfield, Brussels
3:23PM GMT 16 Nov 2012
354 Comments The powerful group of countries, Europe's largest, also welcomed plans to hold a special Brussels summit next year to "confirm our ambitions for security and defence policy" in a move that poses a major headache for the Prime Minister as the EU climbs the domestic political agenda.
Known as the "Weimar group", the five countries met in Paris on Thursday evening to launch a new offensive to create an EU military operations headquarters, after Britain used its veto last year to block similar proposals.
"We are convinced that the EU must set up, within a framework yet to-be-defined, true civilian-military structures to plan and conduct missions and operations," the group of countries said in a communique. "We should show preparedness to hold available, train, deploy and sustain in theatre the necessary civilian and military means."
Earlier this week, The Daily Telegraph revealed that Lady Ashton, the EU foreign minister, has signalled to Paris that she could help defeat Britain over the HQ if France could win other allies, an alliance that has now been sealed among the five countries.
France, Germany, Italy, Spain and Poland see the launch of EU civil-military missions, in Somalia, Mali, Libya, Kosovo, Georgia and Afghanistan, as a means to build momentum for a permanent EU command structure to oversee a growing number of operations.
Britain is isolated after it blocked moves, led by France, last year to create an EU Operational HQ (OHQ) because of concerns, said to be shared by the United States, that it would rival and divide Nato command.
"Rather than the rather sterile debate about costly new structures, most EU member states are now focused on developing European capabilities, making EU missions and operations more effective and ensuring our response to conflict situations reflects a genuinely comprehensive approach," said a government spokesman
"We would continue to oppose the establishment of an EU operational headquarters."
In September this year, a "futures" group of 11 countries, including the Weimar five, called for an end to Britain's veto over defence policy to stop it blocking the OHQ, which is envisaged as a structure that "could eventually involve a European army".
The proposals will be debated, with the support of Lady Ashton, the EU's High Representative for foreign affairs, at a special summit in December 2013 ahead a push towards a new European constitution in the summer of 2014.
"This initiative should receive adequate political support at high level, in close cooperation with the High Representative, and result in increased European political integration. In defence matters as well, we need more Europe. We are committed to working together in this direction," said the group's statement.
Geoffrey Van Orden MEP, the Conservative spokesman on European defence and security policy, warned that demand to set up an OHQ is "central to the federalist aims of the Weimar group".
"This is all to do with creating a European Federation," he said. "The aim of Germany and France is to establish a fully-fledged EU military capability that will further cement European political integration and strengthen their ambition for the EU to be a state-like player on the international stage."
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Re: New EC Thread
Panda Sat 17 Nov - 8:55
I agree with a EU Defence force, it has always been the U.S., Britain and the Commonwealth who send troops to Countries to overthrow Dictators, albeit without success and a great loss of lives and the ruined infrastructure of the Country.
If the EU Defence Force were for peaceful purpose there would be no chance of a War between Members which would be a good thing.
If the EU Defence Force were for peaceful purpose there would be no chance of a War between Members which would be a good thing.
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Re: New EC Thread
Panda Sun 18 Nov - 8:44
Green energy producers cheating with coal
16 November 2012
PresseuropDie Tageszeitung, Lidové noviny
Die Tageszeitung, 16 November 2012
“Green energy providers wants to make coal," leads Tageszeitung, punning on the German word for “coal”, which also means “money”. The Berlin daily, always fretting about environmental issues, reveals that the three biggest renewable electricity distributors in Germany – Lichtblick, Greenpeace Energy and Naturstrom – may soon be going for coal. In fact, all three buy electricity from the Austrian company Verbund AG, which since 2011 has been building a coal-fired plant in Turkey, while continuing to proclaim that its power remains “100% hydroelectric”.
This is highly embarrassing for the three German companies, notes Tageszeitung, citing studies that find that “the emissions from the Turkish plant exceed the limit values defined by the EU and the World Health Organisation.” For the TAZ, it’s time to act –
16 November 2012
PresseuropDie Tageszeitung, Lidové noviny
Die Tageszeitung, 16 November 2012
“Green energy providers wants to make coal," leads Tageszeitung, punning on the German word for “coal”, which also means “money”. The Berlin daily, always fretting about environmental issues, reveals that the three biggest renewable electricity distributors in Germany – Lichtblick, Greenpeace Energy and Naturstrom – may soon be going for coal. In fact, all three buy electricity from the Austrian company Verbund AG, which since 2011 has been building a coal-fired plant in Turkey, while continuing to proclaim that its power remains “100% hydroelectric”.
This is highly embarrassing for the three German companies, notes Tageszeitung, citing studies that find that “the emissions from the Turkish plant exceed the limit values defined by the EU and the World Health Organisation.” For the TAZ, it’s time to act –
The production of energy from renewable sources in Germany is also worrying its neighbours: “The Czech Republic intends to prevent the collapse of its electricity network and protect against surplus green energy production caused by erratic wind farms in the north of Germany,” writes Lidové Noviny. Because of the weakness of the German power grid, the Prague daily explains, wind farm energy produced in Germany's north and destined for the south is routed via the Czech grid, putting its capacity under strain. To protect against power surges, ČEPS, which operates the Czech network –
Whoever wants to remain credible as a green energy supplier should not be signing contracts with such companies – especially when the business plan of the entire company is based on positioning oneself as a moral leader.
... has decided to build a giant transformer near the border. It will not let more current onto the Czech power grid than the grid can support and [...] will enter service by 2017.
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Re: New EC Thread
Panda Sun 18 Nov - 13:02
EU Banking Union’s Legal Basis Isn’t Solid, Bundesbank Says
Photograph by Nick White/Getty Images
by Jeff Black| Nov. 14, 2012 10:44 AM EST |
Posted in austerity, bailouts, banks, bonds, debt, euro, European Central Bank, European Union (EU), Germany
|0 Comments
This was supposed to be the easy part. But installing the ECB as the chief supervisor for all 6,071 banks in Europe by Jan. 1, 2013, just seems to keep getting more difficult. Even though a paragraph in the EU’s...
Read more »
Today in Euro Crisis History: Dept. of Denial
by James Hertling| Nov. 16, 2012 10:02 AM EST |
Posted in euro, European Union (EU), Politics
|0 Comments
November 16, 2011 ‘I DON’T THINK WE HAVE A EURO CRISIS,’ ASMUSSEN SAYS Europe’s debt crisis only seems like it has gone on forever. This series of blog posts looks at headlines from this date in previous years that highlight...
Read more »
Today in Euro Crisis History: Birth of the G-20
by James Hertling| Nov. 15, 2012 12:01 PM EST |
Posted in economics, European Union (EU), Politics, United States
|0 Comments
November 15, 2008 G-20 Calls for `Broad’ Policy Action as Major Economies Weaken World leaders agreed more must be done to shore up the global economy and improve regulation of financial markets, leaving details on how to do that to...
Read more »
Today in Euro Crisis History: Mixed Messages Dept.
by James Hertling| Nov. 14, 2012 10:53 AM EST |
Posted in euro, European Union (EU), Germany, Greece
|0 Comments
November 14, 2011 Merkel’s Christian Democrats Vote to Allow Exits From Euro Area German Chancellor Angela Merkel’s Christian Democratic Union party voted to allow euro states to quit the currency area, endorsing the prospect of a move not permitted under...
Read more »
Photograph by Daniel Acker/Bloomberg
Irish Prime Minister Brian Cowen in New York on July 12, 2010
Today in Euro Crisis History: Vintage Scoop
by James Hertling| Nov. 13, 2012 1:56 PM EST |
Posted in bailouts, banks, European Union (EU), Ireland, Posts
|0 Comments
November 13, 2010 Ireland Urged to Take Aid by European Officials Amid Debt Crisis Irish Prime Minister Brian Cowen said he is working with fellow European leaders as his nation’s sovereign debt crisis threatens the stability of European markets. While...
Read more »
Today in Euro Crisis History: Rose-Colored Glasses
by James Hertling| Nov. 12, 2012 12:12 PM EST |
Posted in banks, Spain, United Kingdom
|0 Comments
November 12, 2004 Santander Completes 9.4 Billion Pound Takeover of Abbey Europe’s debt crisis only seems like it has gone on forever. This series of blog posts looks at headlines from this date in previous years that highlight the roots,...
Read more »
Today in Euro Crisis History: Speaks for Itself
by James Hertling| Nov. 8, 2012 12:42 PM EST |
Posted in austerity, bailouts, debt, European Union (EU), Greece
|0 Comments
November 8, 2010 Greek Restructuring Not An Option to Be Considered, Juncker Says Europe’s debt crisis only seems like it has gone on forever. This series of blog posts looks at headlines from this date in previous years that highlight...
Read more »
Today in Euro Crisis History: Don’t Hold Your Breath
by James Hertling| Nov. 7, 2012 10:21 AM EST |
Posted in bailouts, banks, European Central Bank
|0 Comments
November 7, 2009 Trichet Says Central Banks Plan to Phase Out Crisis Measures ECB President Jean-Claude Trichet said he had a “good meeting” with his counterparts and they will exit smoothly from crisis measures. “All of us, to my knowledge,...
Read more »
Today in Euro Crisis History: Dept. of Deck Chair Shuffling
by James Hertling| Nov. 6, 2012 1:01 PM EST |
Posted in austerity, bailouts, European Union (EU), Greece, Politics
|0 Comments
November 6, 2011 PAPANDREOU TO STEP ASIDE AS GREEK PRIME MINISTER Europe’s debt crisis only seems like it has gone on forever. This series of blog posts looks at headlines from this date in previous years that highlight the roots,...
Read more »
Photograph by Dimitri Messinis/AP Photo
EU Seeks Common View on Greek Debt – As Does Greece
by Ben Vickers| Nov. 6, 2012 5:11 AM EST |
Posted in austerity, bailouts, banks, debt, economics, elections, euro, European Union (EU), Greece, markets
|0 Comments
Strikes in Greece over the next 48 hours will bring out public transport workers, hospital staff and air traffic controllers, among others, as unions try to pressure lawmakers voting this week on another round of austerity cuts, including a fifth...
Read more
Photograph by Nick White/Getty Images
by Jeff Black| Nov. 14, 2012 10:44 AM EST |
Posted in austerity, bailouts, banks, bonds, debt, euro, European Central Bank, European Union (EU), Germany
|0 Comments
This was supposed to be the easy part. But installing the ECB as the chief supervisor for all 6,071 banks in Europe by Jan. 1, 2013, just seems to keep getting more difficult. Even though a paragraph in the EU’s...
Read more »
Today in Euro Crisis History: Dept. of Denial
by James Hertling| Nov. 16, 2012 10:02 AM EST |
Posted in euro, European Union (EU), Politics
|0 Comments
November 16, 2011 ‘I DON’T THINK WE HAVE A EURO CRISIS,’ ASMUSSEN SAYS Europe’s debt crisis only seems like it has gone on forever. This series of blog posts looks at headlines from this date in previous years that highlight...
Read more »
Today in Euro Crisis History: Birth of the G-20
by James Hertling| Nov. 15, 2012 12:01 PM EST |
Posted in economics, European Union (EU), Politics, United States
|0 Comments
November 15, 2008 G-20 Calls for `Broad’ Policy Action as Major Economies Weaken World leaders agreed more must be done to shore up the global economy and improve regulation of financial markets, leaving details on how to do that to...
Read more »
Today in Euro Crisis History: Mixed Messages Dept.
by James Hertling| Nov. 14, 2012 10:53 AM EST |
Posted in euro, European Union (EU), Germany, Greece
|0 Comments
November 14, 2011 Merkel’s Christian Democrats Vote to Allow Exits From Euro Area German Chancellor Angela Merkel’s Christian Democratic Union party voted to allow euro states to quit the currency area, endorsing the prospect of a move not permitted under...
Read more »
Photograph by Daniel Acker/Bloomberg
Irish Prime Minister Brian Cowen in New York on July 12, 2010
Today in Euro Crisis History: Vintage Scoop
by James Hertling| Nov. 13, 2012 1:56 PM EST |
Posted in bailouts, banks, European Union (EU), Ireland, Posts
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November 13, 2010 Ireland Urged to Take Aid by European Officials Amid Debt Crisis Irish Prime Minister Brian Cowen said he is working with fellow European leaders as his nation’s sovereign debt crisis threatens the stability of European markets. While...
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Today in Euro Crisis History: Rose-Colored Glasses
by James Hertling| Nov. 12, 2012 12:12 PM EST |
Posted in banks, Spain, United Kingdom
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November 12, 2004 Santander Completes 9.4 Billion Pound Takeover of Abbey Europe’s debt crisis only seems like it has gone on forever. This series of blog posts looks at headlines from this date in previous years that highlight the roots,...
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Today in Euro Crisis History: Speaks for Itself
by James Hertling| Nov. 8, 2012 12:42 PM EST |
Posted in austerity, bailouts, debt, European Union (EU), Greece
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November 8, 2010 Greek Restructuring Not An Option to Be Considered, Juncker Says Europe’s debt crisis only seems like it has gone on forever. This series of blog posts looks at headlines from this date in previous years that highlight...
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Today in Euro Crisis History: Don’t Hold Your Breath
by James Hertling| Nov. 7, 2012 10:21 AM EST |
Posted in bailouts, banks, European Central Bank
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November 7, 2009 Trichet Says Central Banks Plan to Phase Out Crisis Measures ECB President Jean-Claude Trichet said he had a “good meeting” with his counterparts and they will exit smoothly from crisis measures. “All of us, to my knowledge,...
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Today in Euro Crisis History: Dept. of Deck Chair Shuffling
by James Hertling| Nov. 6, 2012 1:01 PM EST |
Posted in austerity, bailouts, European Union (EU), Greece, Politics
|0 Comments
November 6, 2011 PAPANDREOU TO STEP ASIDE AS GREEK PRIME MINISTER Europe’s debt crisis only seems like it has gone on forever. This series of blog posts looks at headlines from this date in previous years that highlight the roots,...
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Photograph by Dimitri Messinis/AP Photo
EU Seeks Common View on Greek Debt – As Does Greece
by Ben Vickers| Nov. 6, 2012 5:11 AM EST |
Posted in austerity, bailouts, banks, debt, economics, elections, euro, European Union (EU), Greece, markets
|0 Comments
Strikes in Greece over the next 48 hours will bring out public transport workers, hospital staff and air traffic controllers, among others, as unions try to pressure lawmakers voting this week on another round of austerity cuts, including a fifth...
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Re: New EC Thread
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Lagarde to Defend IMF Credibility in Euro-Area Talks on Greece
By Sandrine Rastello - Nov 17, 2012 4:00 PM GMT
International Monetary Fund Managing Director Christine Lagarde said she’ll defend the IMF’s credibility in talks on Greece this week, signalling a potential clash with euro finance chiefs over Greek debt sustainability.
Lagarde cut short a visit to Southeast Asia yesterday to return to Europe for a meeting with euro-region finance ministers in Brussels on Nov. 20. With the two sides deadlocked over the timeline for reducing Greek debt levels, Lagarde said she was approaching the talks feeling “patient and resilient.”
Speaking in an interview in the Philippine capital Manilabefore leaving for Europe, Lagarde said she’ll seek to “operate independently” while sticking to the fund’s rules, suggesting no retreat from her position in the negotiations. Maintaining the “solidity of our advice” on Greece will be just as important as ensuring the country’s program works, she said.
Lagarde took issue last week with European governments’decision to push back a debt reduction target by two years to 2022 against the fund’s recommendations, raising questions over whether the IMF would keep financing Greece. Agreement on how to reduce Greece’s debt to sustainable levels is key to disbursing the next tranche of aid under the bailout that euro nations co-finance with the IMF.
“We never leave the table,” Lagarde said in the interview when asked about dropping support. She declined to answer a question on whether the IMF has room for maneuver in the negotiations.
‘Solid Program’
The IMF’s goals are to achieve “a solid program for Greece that convinces investors today that it will stand tomorrow, and the reliability, credibility, quality of the advice we give and that we lend to the Europeans,” Lagarde said. “I’m always desperately optimistic and I’m always trying to be constructive, but I’m guided by the two objectives.”
The IMF target is for a reduction of Greece’s debt to 120 percent of gross domestic product by 2020, from a projected peak of 190 percent of GDP in 2014. European officials at a Nov. 12 meeting agreed to postpone the 120 percent target to 2022, while rejecting a write off of official debt. The Nov. 20 meeting was called to reach a final deal.
The fund’s credibility rests on the quality of its advice, according to Lagarde. While the IMF accounts for less than a third of the 240 billion euros ($305 billion) pledged for Greece since 2010, the participation of the fund, with its experience in shoring up distressed economies, has helped give investors confidence in the packages for Greece, Ireland and Portugal.
“It’s not our billions of dollars that really matter on this occasion,” Lagarde said. “It’s the solidity of our advice that we are lending to the program.”
Debt Write off
European Central Bank Governing Council member Jens Weidmann said Nov. 16 that Greece may need a second debt write off after policy makers in Athens enact economic reforms. Lagarde, who has suggested that Greece may need another debt cut, declined to comment on Weidmann’s suggestion.
Greece has already undergone the biggest sovereign restructuring in history after getting private investors to forgive more than 100 billion euros of debt in March. German Chancellor Angela Merkel’s chief spokesman said last month that imposing losses on European taxpayers who have lent to Greece is“out of the question.”
In Malaysia on Nov. 14, Lagarde said for Greece the IMF wants “a real fix, not a quick fix and that means clearly a debt that is sustainable as quickly as possible.” At an earlier press conference last week, she stuck to the IMF’s recommended target date of 2020 and acknowledged the disagreement with euro finance chiefs.
Officials including Italian Finance Minister Vittorio Grilli and his German counterpart, Wolfgang Schaeuble, have since expressed confidence an agreement can be reached.
Fiscal Cliff
Lagarde said that officials she met in Malaysia and thePhilippines talked to her less about Europe’s debt crisis than about the U.S. They were concerned about its ability to avoid the so-called fiscal cliff, the combination of $607 billion in automatic tax increases and spending cuts that threatens to throw the country into a recession next year without an alternative agreement by lawmakers.
Treasury Secretary Timothy F. Geithner said in a Nov. 16 interview on Bloomberg Television’s “Political Capital With Al Hunt” that he’s confident an agreement on averting the fiscal cliff can be concluded within weeks after White House talks between President Barack Obama and congressional leaders.
“I think the several weeks will be necessary for people to come to common sense, to practicalities and to get away from their campaign positioning,” Lagarde said in reference to Geithner’s comments. A “sense of practicality will prevail.”
By Sandrine Rastello - Nov 17, 2012 4:00 PM GMT
International Monetary Fund Managing Director Christine Lagarde said she’ll defend the IMF’s credibility in talks on Greece this week, signalling a potential clash with euro finance chiefs over Greek debt sustainability.
Lagarde cut short a visit to Southeast Asia yesterday to return to Europe for a meeting with euro-region finance ministers in Brussels on Nov. 20. With the two sides deadlocked over the timeline for reducing Greek debt levels, Lagarde said she was approaching the talks feeling “patient and resilient.”
Speaking in an interview in the Philippine capital Manilabefore leaving for Europe, Lagarde said she’ll seek to “operate independently” while sticking to the fund’s rules, suggesting no retreat from her position in the negotiations. Maintaining the “solidity of our advice” on Greece will be just as important as ensuring the country’s program works, she said.
Lagarde took issue last week with European governments’decision to push back a debt reduction target by two years to 2022 against the fund’s recommendations, raising questions over whether the IMF would keep financing Greece. Agreement on how to reduce Greece’s debt to sustainable levels is key to disbursing the next tranche of aid under the bailout that euro nations co-finance with the IMF.
“We never leave the table,” Lagarde said in the interview when asked about dropping support. She declined to answer a question on whether the IMF has room for maneuver in the negotiations.
‘Solid Program’
The IMF’s goals are to achieve “a solid program for Greece that convinces investors today that it will stand tomorrow, and the reliability, credibility, quality of the advice we give and that we lend to the Europeans,” Lagarde said. “I’m always desperately optimistic and I’m always trying to be constructive, but I’m guided by the two objectives.”
The IMF target is for a reduction of Greece’s debt to 120 percent of gross domestic product by 2020, from a projected peak of 190 percent of GDP in 2014. European officials at a Nov. 12 meeting agreed to postpone the 120 percent target to 2022, while rejecting a write off of official debt. The Nov. 20 meeting was called to reach a final deal.
The fund’s credibility rests on the quality of its advice, according to Lagarde. While the IMF accounts for less than a third of the 240 billion euros ($305 billion) pledged for Greece since 2010, the participation of the fund, with its experience in shoring up distressed economies, has helped give investors confidence in the packages for Greece, Ireland and Portugal.
“It’s not our billions of dollars that really matter on this occasion,” Lagarde said. “It’s the solidity of our advice that we are lending to the program.”
Debt Write off
European Central Bank Governing Council member Jens Weidmann said Nov. 16 that Greece may need a second debt write off after policy makers in Athens enact economic reforms. Lagarde, who has suggested that Greece may need another debt cut, declined to comment on Weidmann’s suggestion.
Greece has already undergone the biggest sovereign restructuring in history after getting private investors to forgive more than 100 billion euros of debt in March. German Chancellor Angela Merkel’s chief spokesman said last month that imposing losses on European taxpayers who have lent to Greece is“out of the question.”
In Malaysia on Nov. 14, Lagarde said for Greece the IMF wants “a real fix, not a quick fix and that means clearly a debt that is sustainable as quickly as possible.” At an earlier press conference last week, she stuck to the IMF’s recommended target date of 2020 and acknowledged the disagreement with euro finance chiefs.
Officials including Italian Finance Minister Vittorio Grilli and his German counterpart, Wolfgang Schaeuble, have since expressed confidence an agreement can be reached.
Fiscal Cliff
Lagarde said that officials she met in Malaysia and thePhilippines talked to her less about Europe’s debt crisis than about the U.S. They were concerned about its ability to avoid the so-called fiscal cliff, the combination of $607 billion in automatic tax increases and spending cuts that threatens to throw the country into a recession next year without an alternative agreement by lawmakers.
Treasury Secretary Timothy F. Geithner said in a Nov. 16 interview on Bloomberg Television’s “Political Capital With Al Hunt” that he’s confident an agreement on averting the fiscal cliff can be concluded within weeks after White House talks between President Barack Obama and congressional leaders.
“I think the several weeks will be necessary for people to come to common sense, to practicalities and to get away from their campaign positioning,” Lagarde said in reference to Geithner’s comments. A “sense of practicality will prevail.”
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Re: New EC Thread
Panda Mon 19 Nov - 9:53
Not a single penny more for the EU’s begging bowl
The demand for a budget increase amid such an abuse of public funds is outrageous, says Boris Johnson
Herman Van Rompuy wants a rise in spending by Brussels of 5 to 6.8 per cent Photo: REUTERS
By Boris Johnson
6:04AM GMT 19 Nov 2012
205 Comments
There are decisions in politics that are agonisingly tough. Sometimes you have to wrap a cold towel round your head and try to balance the outcomes. You might even sit down, scratch your chin and write a list of the pros and cons. And sometimes the choice is such a no-brainer that you can’t see how any reasonable person could disagree. That, surely, is the position on the EU budget, and the Commission’s amazing demand for an increase.
When David Cameron goes to the EU summit this week, I have absolutely no doubt that he will veto this package, and not only will he have every sensible person in this country — and in the rest of Europe — cheering him on, he will be right politically, intellectually, morally and on just about every ground that you can imagine. Herman Van Rompuy is asking for an increase in spending by Brussels of between 5 and 6.8 per cent, at a time when the whole of the Community has been enduring cuts in public expenditure.
You will be familiar with what is happening in Greece, where the cataclysmic result of euro membership is that GDP has fallen by 7.2 per cent in one year. Cancer patients are being deprived of drugs; the suicide rate has soared; youth unemployment is stratospheric and much of downtown Athens looks like a war zone after repeated rioting against the “austerity” measures demanded by this very same EU Commission. To a greater or lesser extent, the symptoms of the euro tragedy can now be seen not just in the Mediterranean countries, but even in Germany, where the collapse of export markets in the euro-Zollverein is starting to affect the output of the EU’s most powerful economy.
Here in Britain — the second biggest net contributor to the EU budget — we face continuing pressure on spending of all kinds. Welfare is being capped; we face difficult but necessary reforms of health care; and across the country there will be essential reforms to police and fire services. We have just seen cuts to school sports programmes — which you might have thought were an essential element of a sporting legacy from the 2012 Olympics — and this is the moment when the Commission seriously thinks it can come to the British taxpayer and ask for billions more in subsidy. My message to M Van Rompuy is donnez moi un break, mate.
The people in Brussels must have been out of their tiny minds. It is like giving heroin to an addict. It is like handing an ice cream to the fattest boy in the class, while the rest of the kids are on starvation diets — and then asking them to pay for his treat.
Related Articles
This is a budget so riddled with fraud and malpractice that in 18 years it has never been given a clean bill of health by the European Court of Auditors. Bear in mind, moreover, that this Court is itself an EU institution, with nothing like the resources it needs to invigilate the local politicians, farmers, business people and all-purpose crooks who are in receipt of funding from us all.
According to this toothless Luxembourg watchdog, there are at least 5.2 billion euros that go astray every year — and the proportion is rising again, not falling. The bureaucrats speak plaintively of a certain Spanish sheep farmer they came across. “A farmer was granted a special premium for 150 sheep. The court found that the beneficiary did not have any sheep. The corresponding payment was irregular.”
Irregular! It wasn’t irregular — it was a swindle. It was theft from you and me. You only have to imagine the ludicrous scene, of Luxembourg officials scrabbling over some dusty Spanish hillside in search of 150 non-existent merinos to see that they have only scratched the surface of the abuse.
There are fields that are forests that are meant to be farmed. There are forests that are meant to be fields, and we are paying subsidy for both. Last year the Commission itself confessed that EU spending on Romania — €515 million — had been almost all the subject of fraud or abuse of one kind or another. Hand on heart, said Brussels, it looked as though only about 10 per cent of the cash had got through to legitimate destinations. The EU budget will never be properly policed because the cash doesn’t properly belong to any nation — it belongs to “everybody”. And since it belongs to everybody, each individual country cynically reasons that there isn’t that much harm if its own citizens quietly loot as much of it as they reasonably can.
Which leaves it to the central EU institutions to try to police this Ottoman structure. They don’t have a hope. It is no particular comfort to learn that the Health Commissioner, a Maltese called John Dalli, has just resigned under a cloud, amid allegations of an attempt to rig a decision in favour of some Swedish snuff tycoons. Meanwhile, here are the officials of the EU Commission, arriving in Athens in their taxpayer-funded executive jets, with their message of hardship for the people of Greece. They wag their fingers at the Greeks, and tell them that they must mend their ways.
They must stop the waste and the fraud, says the EU Commission, before they have any hope of more bail-out funds. And yet these same EU officials preside over a vast and larcenous abuse of public funds, and now have the effrontery to tell us that they need a massive above-inflation increase to pay, inter alia, for the great unreformed caravanserai between Brussels, Luxembourg and Strasbourg.
There is absolutely nothing to be lost from a veto. It may be impossible to cut the budget, since there is no other country actively proposing this excellent option. But there is no reason at all why EU spending should not be frozen exactly where it is.
The worst that can happen is that the existing budget will be rolled over, a month at a time. It is time for David Cameron to put on that pineapple-coloured wig and powder blue suit, whirl his handbag round his head and bring it crashing to the table with the words no, non, nein, neen, nee, ne, ei and ochi, until they get the message.
=================================
See......I said he would be a good PM
The demand for a budget increase amid such an abuse of public funds is outrageous, says Boris Johnson
Herman Van Rompuy wants a rise in spending by Brussels of 5 to 6.8 per cent Photo: REUTERS
By Boris Johnson
6:04AM GMT 19 Nov 2012
205 Comments There are decisions in politics that are agonisingly tough. Sometimes you have to wrap a cold towel round your head and try to balance the outcomes. You might even sit down, scratch your chin and write a list of the pros and cons. And sometimes the choice is such a no-brainer that you can’t see how any reasonable person could disagree. That, surely, is the position on the EU budget, and the Commission’s amazing demand for an increase.
When David Cameron goes to the EU summit this week, I have absolutely no doubt that he will veto this package, and not only will he have every sensible person in this country — and in the rest of Europe — cheering him on, he will be right politically, intellectually, morally and on just about every ground that you can imagine. Herman Van Rompuy is asking for an increase in spending by Brussels of between 5 and 6.8 per cent, at a time when the whole of the Community has been enduring cuts in public expenditure.
You will be familiar with what is happening in Greece, where the cataclysmic result of euro membership is that GDP has fallen by 7.2 per cent in one year. Cancer patients are being deprived of drugs; the suicide rate has soared; youth unemployment is stratospheric and much of downtown Athens looks like a war zone after repeated rioting against the “austerity” measures demanded by this very same EU Commission. To a greater or lesser extent, the symptoms of the euro tragedy can now be seen not just in the Mediterranean countries, but even in Germany, where the collapse of export markets in the euro-Zollverein is starting to affect the output of the EU’s most powerful economy.
Here in Britain — the second biggest net contributor to the EU budget — we face continuing pressure on spending of all kinds. Welfare is being capped; we face difficult but necessary reforms of health care; and across the country there will be essential reforms to police and fire services. We have just seen cuts to school sports programmes — which you might have thought were an essential element of a sporting legacy from the 2012 Olympics — and this is the moment when the Commission seriously thinks it can come to the British taxpayer and ask for billions more in subsidy. My message to M Van Rompuy is donnez moi un break, mate.
The people in Brussels must have been out of their tiny minds. It is like giving heroin to an addict. It is like handing an ice cream to the fattest boy in the class, while the rest of the kids are on starvation diets — and then asking them to pay for his treat.
Related Articles
Be as strong as Thatcher on EU, Boris tells Cameron
18 Nov 2012
Voters 'won't believe EU referendum pledge'
18 Nov 2012
Labour’s tough talk on Europe fails to convince
18 Nov 2012
This is a budget so riddled with fraud and malpractice that in 18 years it has never been given a clean bill of health by the European Court of Auditors. Bear in mind, moreover, that this Court is itself an EU institution, with nothing like the resources it needs to invigilate the local politicians, farmers, business people and all-purpose crooks who are in receipt of funding from us all.
According to this toothless Luxembourg watchdog, there are at least 5.2 billion euros that go astray every year — and the proportion is rising again, not falling. The bureaucrats speak plaintively of a certain Spanish sheep farmer they came across. “A farmer was granted a special premium for 150 sheep. The court found that the beneficiary did not have any sheep. The corresponding payment was irregular.”
Irregular! It wasn’t irregular — it was a swindle. It was theft from you and me. You only have to imagine the ludicrous scene, of Luxembourg officials scrabbling over some dusty Spanish hillside in search of 150 non-existent merinos to see that they have only scratched the surface of the abuse.
There are fields that are forests that are meant to be farmed. There are forests that are meant to be fields, and we are paying subsidy for both. Last year the Commission itself confessed that EU spending on Romania — €515 million — had been almost all the subject of fraud or abuse of one kind or another. Hand on heart, said Brussels, it looked as though only about 10 per cent of the cash had got through to legitimate destinations. The EU budget will never be properly policed because the cash doesn’t properly belong to any nation — it belongs to “everybody”. And since it belongs to everybody, each individual country cynically reasons that there isn’t that much harm if its own citizens quietly loot as much of it as they reasonably can.
Which leaves it to the central EU institutions to try to police this Ottoman structure. They don’t have a hope. It is no particular comfort to learn that the Health Commissioner, a Maltese called John Dalli, has just resigned under a cloud, amid allegations of an attempt to rig a decision in favour of some Swedish snuff tycoons. Meanwhile, here are the officials of the EU Commission, arriving in Athens in their taxpayer-funded executive jets, with their message of hardship for the people of Greece. They wag their fingers at the Greeks, and tell them that they must mend their ways.
They must stop the waste and the fraud, says the EU Commission, before they have any hope of more bail-out funds. And yet these same EU officials preside over a vast and larcenous abuse of public funds, and now have the effrontery to tell us that they need a massive above-inflation increase to pay, inter alia, for the great unreformed caravanserai between Brussels, Luxembourg and Strasbourg.
There is absolutely nothing to be lost from a veto. It may be impossible to cut the budget, since there is no other country actively proposing this excellent option. But there is no reason at all why EU spending should not be frozen exactly where it is.
The worst that can happen is that the existing budget will be rolled over, a month at a time. It is time for David Cameron to put on that pineapple-coloured wig and powder blue suit, whirl his handbag round his head and bring it crashing to the table with the words no, non, nein, neen, nee, ne, ei and ochi, until they get the message.
=================================
See......I said he would be a good PM
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Re: New EC Thread
Panda Mon 19 Nov - 12:13
Plans for EU budget without Britain 'a slap in the face'
Possible plans for a long-term European budget without Britain have been branded a "slap in the face" by UK MEPs.
European council President Herman Van Rompuy Photo: EPA
By Martin Banks, Brussels
9:59AM GMT 19 Nov 2012
357 Comments
In a move that will be seen as increasing British isolationism in the EU, an 'alternative' budget is reportedly being considered in Brussels ahead of this week's crunch summit of EU leaders and heads of state.
Britain is pressing for a real-terms freeze in the EU's 2014-2020 budget, with the Coalition opposing a 5 per cent increase compared with the current 2007-2013 budget, as proposed by the European Commission.
The long-term budget, covering about €1,000bn spending over seven years, requires unanimity but David Cameron has threatened a veto if necessary at the two-day EU summit which is supposed to resolve the post-2013 budget.
According to The Financial Times(£), EU officials and diplomats have now begun work on studying the legal and technical feasibility of a budget without the UK.
An alternative budget would be done on an annual basis which, under EU rules, requires only qualified majority votes.
Related Articles
The plans however have been branded a "slap in the face".
Marta Andreasen, of Ukip, asked, "If the EU is prepared to act unilaterally and exclude the second largest contributor to the budget -the UK -then the question has to be asked: what is the benefit of being a member of the EU?
"David Cameron has two options to this slap in the face, either he turns the other cheek and rolls over on the budget or he seizes this opportunity to remove the UK from the farce that is EU membership. The EU has far more to lose than the UK from a British exit."
Richard Ashworth, who leads the Tory MEPs in Brussels, said, "The UK veto may be a thorn in the side of some in Brussels, but it is a legal reality and it is there for a reason. They cannot just wish it away, it would require treaty change.
"We are seeing all kinds of wild talk in advance of the summit as people adopt negotiating positions, but people with Europe's best interests at heart should be encouraging calm heads, not trying to stoke up the temperature.The UK's negotiators will not give in to threats."
France, infuriated at the possible prospect of deep reductions to agriculture spending, is believed to be backing a budget without the UK.
Britain also opposes an EU budget rise of 6.8 per cent in 2013, saying spending should be frozen at 2011 levels.
European council President Herman Van Rompuy last week tabled a draft budget that included €80bn in cuts from that proposed by the Commission but the UK is still pressing for further cuts, particularly to the salaries and benefits of EU civil servants.
Budget talks will resume in Brussels on Monday where Britain will try to push down ever-rising EU administrative costs, an estimated 70 per cent of which go on pay and perks.
According to official figures seen by The Daily Telegraph, some 18% of EU officials earn £100,000 per year compared to 0.5 per cent of British civil servants while around 1,000 EU officials earn more than the Prime Minister.
=================================
Let's have a Referendum NOW I say. Britain still has a lot of Countries it trades with, the Commonwealth , thanks to the Queen, is still strong, all the MEPs salaries and perks would be saved , no more one of three Countries who are major contributors to the EU Budget .
Possible plans for a long-term European budget without Britain have been branded a "slap in the face" by UK MEPs.
European council President Herman Van Rompuy Photo: EPA
By Martin Banks, Brussels
9:59AM GMT 19 Nov 2012
357 Comments In a move that will be seen as increasing British isolationism in the EU, an 'alternative' budget is reportedly being considered in Brussels ahead of this week's crunch summit of EU leaders and heads of state.
Britain is pressing for a real-terms freeze in the EU's 2014-2020 budget, with the Coalition opposing a 5 per cent increase compared with the current 2007-2013 budget, as proposed by the European Commission.
The long-term budget, covering about €1,000bn spending over seven years, requires unanimity but David Cameron has threatened a veto if necessary at the two-day EU summit which is supposed to resolve the post-2013 budget.
According to The Financial Times(£), EU officials and diplomats have now begun work on studying the legal and technical feasibility of a budget without the UK.
An alternative budget would be done on an annual basis which, under EU rules, requires only qualified majority votes.
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19 Nov 2012
Give Wales tax and borrowing powers - report
19 Nov 2012
The plans however have been branded a "slap in the face".
Marta Andreasen, of Ukip, asked, "If the EU is prepared to act unilaterally and exclude the second largest contributor to the budget -the UK -then the question has to be asked: what is the benefit of being a member of the EU?
"David Cameron has two options to this slap in the face, either he turns the other cheek and rolls over on the budget or he seizes this opportunity to remove the UK from the farce that is EU membership. The EU has far more to lose than the UK from a British exit."
Richard Ashworth, who leads the Tory MEPs in Brussels, said, "The UK veto may be a thorn in the side of some in Brussels, but it is a legal reality and it is there for a reason. They cannot just wish it away, it would require treaty change.
"We are seeing all kinds of wild talk in advance of the summit as people adopt negotiating positions, but people with Europe's best interests at heart should be encouraging calm heads, not trying to stoke up the temperature.The UK's negotiators will not give in to threats."
France, infuriated at the possible prospect of deep reductions to agriculture spending, is believed to be backing a budget without the UK.
Britain also opposes an EU budget rise of 6.8 per cent in 2013, saying spending should be frozen at 2011 levels.
European council President Herman Van Rompuy last week tabled a draft budget that included €80bn in cuts from that proposed by the Commission but the UK is still pressing for further cuts, particularly to the salaries and benefits of EU civil servants.
Budget talks will resume in Brussels on Monday where Britain will try to push down ever-rising EU administrative costs, an estimated 70 per cent of which go on pay and perks.
According to official figures seen by The Daily Telegraph, some 18% of EU officials earn £100,000 per year compared to 0.5 per cent of British civil servants while around 1,000 EU officials earn more than the Prime Minister.
=================================
Let's have a Referendum NOW I say. Britain still has a lot of Countries it trades with, the Commonwealth , thanks to the Queen, is still strong, all the MEPs salaries and perks would be saved , no more one of three Countries who are major contributors to the EU Budget .
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Re: New EC Thread
Panda Mon 19 Nov - 17:19
Europe & the World
EU-China
EU puts foot down on porcelain imports
19 November 2012
PresseuropLes Echos
Les Echos, 19 November 2012
“In a bid to defend the single market, the European Commission has decided […] to raise customs tariffs from 17.6 % to 58.8% on 55 articles of porcelain and ceramic tableware imported from China”, announces Les Echos. The business daily reports that the Brussels initiative has resulted from “a complaint filed by European producers on 31 January 2012” and that “the tariff increases are provisional: next May, if dumping is confirmed by further studies, the Commission will invite member states to vote on the prolongation of penalties for a five-year period”.
“Should we speak of an important and courageous decision?” as two French ministers have done, wonders the editorial of the Paris based newspaper–
EU-China
EU puts foot down on porcelain imports
19 November 2012
PresseuropLes Echos
Les Echos, 19 November 2012
“In a bid to defend the single market, the European Commission has decided […] to raise customs tariffs from 17.6 % to 58.8% on 55 articles of porcelain and ceramic tableware imported from China”, announces Les Echos. The business daily reports that the Brussels initiative has resulted from “a complaint filed by European producers on 31 January 2012” and that “the tariff increases are provisional: next May, if dumping is confirmed by further studies, the Commission will invite member states to vote on the prolongation of penalties for a five-year period”.
“Should we speak of an important and courageous decision?” as two French ministers have done, wonders the editorial of the Paris based newspaper–
There is nothing exceptional about this decision, which is similar to a number of others that have recently been taken by the Commission. Brussels has opened two inquiries on solar panels, which play a much larger role in Europe’s trade deficit with China (more than 20 billion euros of imports last year). And it is planning to launch a further inquiry in the more prestigious and high-profile telecom equipment sector. Chinese authorities and the Chinese media have begun to show signs of irritation with this harder line, which is not necessarily a bad sign.
The new attitude in Brussels is not so much a result of the economic crisis in Europe but rather of the economic success of China. In their bid to sustain high rates of growth, Chinese authorities have turned a blind eye to a range of practices forbidden by the rules of international trade: in particular they have failed to ensure respect for intellectual property, and allowed producers to take advantage of regional subsidies and price dumping. Given that the world’s largest country is no longer a poor nation deserving of special treatment, we can naturally expect its largest trading partner, the European Union, to intervene on a case by case basis, with procedures that strictly respect the rules laid down by the World Trade Organisation, to ensure that business practices are compliant. However, it would be fanciful to believe that the the customs tariffs leveled as part of these procedures will save European industry.
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Debt crisis: France downgrade blow as eurozone remains split on Greece aid - live
Moody's stripped France of its prized 'AAA' credit rating and warned it could be downgraded further as eurozone finance ministers remain split on Greek aid ahead of as key meeting in Brussels today.
Moody's stripped France of its prized 'AAA' credit rating ahead of eurozone finance ministers meeting in Brussels to discuss Greece's loan terms. Photo: The Economist
By Rebecca Clancy
11:35AM GMT 20 Nov 2012
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11.35 Further doubt is being cast on a decision being reached by the eurozone finance ministers on Greece.
Finland's finance minister has now said she is unsure whether eurozone finance ministers would approve Greece's next loan tranche at a meeting later in the day.
"I'm not at all sure that it will happen. More information is needed before a decision can be made, so the situation is very much open," Jutta Urpilainen told reporters after a parliamentary briefing.
Urpilainen repeated that Finland was ready to give Greece more time to reach its financing program targets but said a restructuring of its debt was out of the question.
11.27 Greek website eKathimerini.com is reporting that municipal employees are continuing sit-ins at hundreds of city halls and municipal services across Greece to protest their inclusion in a fast-track scheme to redundancy.
The sit-ins come as the government was forced to refute claims that the Troika is demanding 22,000 layoffs in the public sector next year.
The demand for the layoffs is said to have been forwarded to the Finance Ministry by International Monetary Fund officials, a report denied by ministry officials.
According to the unconfirmed reports, these layoffs would be in addition to the total of 80,000 civil service departures demanded by the troika through 2016.
Sources told Kathimerini that the rumours could be a tactic by the IMF in the ongoing diplomatic standoff between the Fund and eurozone officials on the Greek issue.
11.02 And more on France. The head of the country's largest employers federation has called on the government to step up reforms following the downgrade.
Laurence Parisot, head of the MEDEF federation, urged the government to carry out ambitious reforms that would prove wrong Moody's concerns about France's capacity to reverse its declining economic competitiveness.
Parisot called for "deeper and more decisive reforms", however, warning that if the labour talks failed to yield ambitious changes financial markets would take fright.
"Obviously after Standard & Poor's in January, this downgrade puts particularly strong pressure on us, even more than we already had on our shoulders," she told journalists.
"The aim has got to be that our companies find themselves in an economically healthy situation and that they are able to create jobs."
10.56 More from Germany. As we mentioned earlier (see 09.59) once the eurozone finance ministers have agreed on Greece's loan then national parliaments will have to vote.
Well, Germany's Bundestag lower house of parliament will vote on the release of the latest tranche of aid for Greece next week and Chancellor Angela Merkel's conservatives are confident it will be approved, a senior conservative lawmaker said, reports Reuters.
"We want to do this in next week's sessions," said Michael Grosse-Broemer, the conservative's parliamentary floor leader.
He told reporters he was optimistic that the conservatives and their Free Democrat (FDP) junior coalition partners would manage a majority, saving Merkel the humiliation of relying on the pro-bailout opposition Social Democrats (SDP) and Greens.
10.38 Germany has voiced its opinion on Moody's stripping France of its 'AAA' credit rating saying it was a "small warning" to the country but added that it should not be over-dramatised.
In a speech to the Bundestag lower house of parliament German Finance Minister Wolfgang Schaeuble said: "We got the news last night that our most important partner had received a small warning from a ratings agency.
"France's rating is still stable, one shouldn't over-dramatise this. We all have an interest in everyone in Europe living up to their responsibilities."
10.22 Over to Spain which has held a debt auction raising nearly €5bn and beating targets.
The details:
€4.9bn of 12-month bills with an average yield of 2.797pc, slightly down from 2.823 at the previous auction.
€713m of 18-month bills with an average yield of 3.034pc, up from 3.022pc.
Spain's target had been to issue €3.5bn-€4bn in bills.
The 18-month bill saw the strongest demand, with a bid-to-cover ratio of 5.7, compared with 3.0 at the last auction, while the 12-month bill was 2.1 times subscribed after 2.7 times in October.
10.04 If tonight's meeting of eurozone finance ministers does run into an all-nighter there's a chance it will not be the only one this week.
EU budget talks continue between Europe's ministers at Thursday's summit.
The Telegraph's Bruno Waterfield says that it looks as if Cameron is looking for face-saving cuts to eurocrat pay/numbers to offset failures to get cuts in the overall budget.
09.59 Ahead of the eurozone finance ministers meeting the Telegraph's Brussels correspondent Bruno Waterfield has said it may well be an all-nighter.
The ministers are set to arrive from 2pm or 3pm and the meeting is due to begin at 4pm UK time.
Waterfield says there is a deep split between the EU and IMF over viability of the loans to Athens, with German opposition MPS demanding a Washington sign off for the bailout.
The aim of the meeting is to provisionally approve the next instalment of Greece's bailout - but it will also have to be agreed in each of the 17 national parliaments.
09.25 However, France has shrugged off the downgradeand said its economy is sound and reforms are on track.
"The rating change does not call into question the economic fundamentals of our country, the efforts undertaken by the government or our creditworthiness," Finance Minister Pierre Moscovici told reporters this morning.
He also told Reuters late on Monday the downgrade was a motivation for the 6-month-old Socialist government to pursue reforms, but he noted that even after the S&P downgrade French debt has enjoyed record low yields.
He also said the government was committed to meeting its target of cutting the public debt to 3pc of economic output next year from an estimated 4.5pc this year.
09.05 Some reaction to that downgrade of France by Moody's.
Markus Huber, head of German HNW trading at ETX Capital, said it was not a surprise but worringly showed how the debt crisis has spread to the core countries.
While the move by Moody’s doesn’t necessarily comes as a surprise considered that not only has the European financial crisis still not been fully contained and French growth and finances have been weakening over the last few quarters it certainly sends an important reminder that not only Greece and Spain are struggling with high debt levels and excessive budget deficits but also that France has much work left to do to balance their books.
Furthermore this also means that the honeymoon period for French President Hollande has certainly come to an end.
Angus Campbell, head of market analysis at Capital Spreads, said the downgrade put Moody's rating of France in line with S&P but ahead of Fitch, but he expected them to follow suit in a couple of months.
It has been on the cards for some time now and since the new President Francois Hollande has made little effort to address the fiscal concerns the markets had been expecting it.
...Moody’s have reminded us of the perilous situation that France is in. Many are of the belief that France is just an accident waiting to happen as its debt trajectory is going in completely the wrong direction. France’s deficit might be lower than the UK’s, but its total debt as a percentage of GDP is higher and one of the worst in the EU – even higher than Spain! Its lack of competitiveness is slowly but surely dragging it down and so there’s every chance we’ll see Monsieur Hollande back track on a number of his policies next year.
09.01 IFR Markets is reporting that a deal is expected on Greece today which will result in the debt-laden country receiving €44bn on December 5, according to a timeline they have seen. They report that the timeline goes something like this:
Nov 20 - Agree in principle to release aid conditional on Greece completing a set of "prior actions"
Nov 28 - Lenders will check if the "prior actions" have been completed
Nov 30 - Proposals on reducing Greek debt and additional financing sent for approval and completed by this date
Dec 3 - Eurozone finance ministers to make final decision to pay next tranche
Dec 4 - Greece and EC sign a revised MoU
Dec 5 - Greece gets aid payment
08.52 So eurozone finance ministers are meeting in Brussels from 4pm today to decide on a rescue deal for Greece but it would appear that the leaders remain at odds on how to reduce the country's growing debt mountain.
At the meeting the ministers will try to finalise a deal to unlock the next tranche of the country's bail-out.
"We are headed for an agreement, but a partial one," one European diplomat told AFP, suggesting that the finance ministers could require yet another meeting before the end of November to address outstanding issues.
Greece approved laws on Monday to enforce budget targets and ensure privatisation proceeds are used to pay off debt, seeking to appease foreign lenders before the critical meeting of eurozone finance ministers on Tuesday.
Athens said the decrees - in addition to an austerity package passed this month - completed its obligations to lenders before Tuesday's Eurogroup meeting, which it hopes will unlock more aid to stave off bankruptcy.
Yannis Stournaras, Greece's finance minister, said that Greece was "totally ready" for the meeting.
"There are no longer any pending issues on our side. Greece is totally ready," he said.
08.33 Unsurprisingly markets in European edged lower in early trading following the news on France.
The FTSE 100 fell 0.2pc, while the CAC anmd IBEX were down 0.1pc.
The DAX managed to buck the trend for now and was up 0.2pc.
08.28And there could be more bad news for France.
The lead analyst at Moody's for France's sovereign rating Dietmar Hornung has warned that the eurozone's second largest economy could be downgraded further if the Socialist government fails to implement announced reforms
He said:
We would downgrade the rating further in the event of additional material deterioration in France's economic prospects or in a scenario in which there were difficulties in implementing the announced reforms.
08.22 But first some news from late last night.
France has suffered a serious blow to its economic credentials after being stripped of its prized AAA credit rating by Moody’s.
The rating agency said France’s long-term economic growth had been hit by its inflexible labour market and low levels of innovation eroding its competitiveness and industrial base.
Moody's also flagged up the country’s exposure to the continuing eurozone crisis.
It warned the “predictability” of France’s resilence of further shocks in the eurozone was diminishing while the country’s exposure to the highly indebted countries such as Spain and Greece was disproportionately high.
In a statement Moody’s said:
Further shocks to sovereign and bank credit markets would further undermine financial and economic stability in France as well as in other euro area countries.
The impact of such shocks would be expected to be felt disproportionately by more highly indebted governments such as France.
08.18 Later today eurozone finance ministers will meet yet again in Brussels to discuss Greece. Yesterday Germany said it was not possible that a deal would be reached today but Reuters reported that officials close to the deal expect a "political endorsement in principle" on unfreezing loans to Athens.
We will keep you updated on that through the day.
08.15 Good morning and welcome to the Debt Crisis live blog.
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Moody's stripped France of its prized 'AAA' credit rating and warned it could be downgraded further as eurozone finance ministers remain split on Greek aid ahead of as key meeting in Brussels today.
Moody's stripped France of its prized 'AAA' credit rating ahead of eurozone finance ministers meeting in Brussels to discuss Greece's loan terms. Photo: The Economist
By Rebecca Clancy
11:35AM GMT 20 Nov 2012
93 Comments runUpdate = true;
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2012-11-20 11:35:30.0
http://www.telegraph.co.uk/finance/debt-crisis-live/9688943/Debt-crisis-France-downgrade-blow-as-eurozone-remains-split-on-Greece-aid-live.html?service=artBody
This page will automatically update every 90 secondsOn Off
• Eurozone leaders split over Greek debt ahead of key meeting
• France stripped of prized 'AAA' credit rating by Moody's
• Moody's statement in full
• France shrugs off the downgrade and says reforms on track
• France could be downgraded further, Moody's warns
Latest
11.35 Further doubt is being cast on a decision being reached by the eurozone finance ministers on Greece.
Finland's finance minister has now said she is unsure whether eurozone finance ministers would approve Greece's next loan tranche at a meeting later in the day.
"I'm not at all sure that it will happen. More information is needed before a decision can be made, so the situation is very much open," Jutta Urpilainen told reporters after a parliamentary briefing.
Urpilainen repeated that Finland was ready to give Greece more time to reach its financing program targets but said a restructuring of its debt was out of the question.
11.27 Greek website eKathimerini.com is reporting that municipal employees are continuing sit-ins at hundreds of city halls and municipal services across Greece to protest their inclusion in a fast-track scheme to redundancy.
The sit-ins come as the government was forced to refute claims that the Troika is demanding 22,000 layoffs in the public sector next year.
The demand for the layoffs is said to have been forwarded to the Finance Ministry by International Monetary Fund officials, a report denied by ministry officials.
According to the unconfirmed reports, these layoffs would be in addition to the total of 80,000 civil service departures demanded by the troika through 2016.
Sources told Kathimerini that the rumours could be a tactic by the IMF in the ongoing diplomatic standoff between the Fund and eurozone officials on the Greek issue.
11.02 And more on France. The head of the country's largest employers federation has called on the government to step up reforms following the downgrade.
Laurence Parisot, head of the MEDEF federation, urged the government to carry out ambitious reforms that would prove wrong Moody's concerns about France's capacity to reverse its declining economic competitiveness.
Parisot called for "deeper and more decisive reforms", however, warning that if the labour talks failed to yield ambitious changes financial markets would take fright.
"Obviously after Standard & Poor's in January, this downgrade puts particularly strong pressure on us, even more than we already had on our shoulders," she told journalists.
"The aim has got to be that our companies find themselves in an economically healthy situation and that they are able to create jobs."
10.56 More from Germany. As we mentioned earlier (see 09.59) once the eurozone finance ministers have agreed on Greece's loan then national parliaments will have to vote.
Well, Germany's Bundestag lower house of parliament will vote on the release of the latest tranche of aid for Greece next week and Chancellor Angela Merkel's conservatives are confident it will be approved, a senior conservative lawmaker said, reports Reuters.
"We want to do this in next week's sessions," said Michael Grosse-Broemer, the conservative's parliamentary floor leader.
He told reporters he was optimistic that the conservatives and their Free Democrat (FDP) junior coalition partners would manage a majority, saving Merkel the humiliation of relying on the pro-bailout opposition Social Democrats (SDP) and Greens.
10.38 Germany has voiced its opinion on Moody's stripping France of its 'AAA' credit rating saying it was a "small warning" to the country but added that it should not be over-dramatised.
In a speech to the Bundestag lower house of parliament German Finance Minister Wolfgang Schaeuble said: "We got the news last night that our most important partner had received a small warning from a ratings agency.
"France's rating is still stable, one shouldn't over-dramatise this. We all have an interest in everyone in Europe living up to their responsibilities."
10.22 Over to Spain which has held a debt auction raising nearly €5bn and beating targets.
The details:
€4.9bn of 12-month bills with an average yield of 2.797pc, slightly down from 2.823 at the previous auction.
€713m of 18-month bills with an average yield of 3.034pc, up from 3.022pc.
Spain's target had been to issue €3.5bn-€4bn in bills.
The 18-month bill saw the strongest demand, with a bid-to-cover ratio of 5.7, compared with 3.0 at the last auction, while the 12-month bill was 2.1 times subscribed after 2.7 times in October.
10.04 If tonight's meeting of eurozone finance ministers does run into an all-nighter there's a chance it will not be the only one this week.
EU budget talks continue between Europe's ministers at Thursday's summit.
The Telegraph's Bruno Waterfield says that it looks as if Cameron is looking for face-saving cuts to eurocrat pay/numbers to offset failures to get cuts in the overall budget.
09.59 Ahead of the eurozone finance ministers meeting the Telegraph's Brussels correspondent Bruno Waterfield has said it may well be an all-nighter.
The ministers are set to arrive from 2pm or 3pm and the meeting is due to begin at 4pm UK time.
Waterfield says there is a deep split between the EU and IMF over viability of the loans to Athens, with German opposition MPS demanding a Washington sign off for the bailout.
The aim of the meeting is to provisionally approve the next instalment of Greece's bailout - but it will also have to be agreed in each of the 17 national parliaments.
09.25 However, France has shrugged off the downgradeand said its economy is sound and reforms are on track.
"The rating change does not call into question the economic fundamentals of our country, the efforts undertaken by the government or our creditworthiness," Finance Minister Pierre Moscovici told reporters this morning.
He also told Reuters late on Monday the downgrade was a motivation for the 6-month-old Socialist government to pursue reforms, but he noted that even after the S&P downgrade French debt has enjoyed record low yields.
He also said the government was committed to meeting its target of cutting the public debt to 3pc of economic output next year from an estimated 4.5pc this year.
09.05 Some reaction to that downgrade of France by Moody's.
Markus Huber, head of German HNW trading at ETX Capital, said it was not a surprise but worringly showed how the debt crisis has spread to the core countries.
While the move by Moody’s doesn’t necessarily comes as a surprise considered that not only has the European financial crisis still not been fully contained and French growth and finances have been weakening over the last few quarters it certainly sends an important reminder that not only Greece and Spain are struggling with high debt levels and excessive budget deficits but also that France has much work left to do to balance their books. Furthermore this also means that the honeymoon period for French President Hollande has certainly come to an end.
Angus Campbell, head of market analysis at Capital Spreads, said the downgrade put Moody's rating of France in line with S&P but ahead of Fitch, but he expected them to follow suit in a couple of months.
It has been on the cards for some time now and since the new President Francois Hollande has made little effort to address the fiscal concerns the markets had been expecting it. ...Moody’s have reminded us of the perilous situation that France is in. Many are of the belief that France is just an accident waiting to happen as its debt trajectory is going in completely the wrong direction. France’s deficit might be lower than the UK’s, but its total debt as a percentage of GDP is higher and one of the worst in the EU – even higher than Spain! Its lack of competitiveness is slowly but surely dragging it down and so there’s every chance we’ll see Monsieur Hollande back track on a number of his policies next year.
09.01 IFR Markets is reporting that a deal is expected on Greece today which will result in the debt-laden country receiving €44bn on December 5, according to a timeline they have seen. They report that the timeline goes something like this:
Nov 20 - Agree in principle to release aid conditional on Greece completing a set of "prior actions"
Nov 28 - Lenders will check if the "prior actions" have been completed
Nov 30 - Proposals on reducing Greek debt and additional financing sent for approval and completed by this date
Dec 3 - Eurozone finance ministers to make final decision to pay next tranche
Dec 4 - Greece and EC sign a revised MoU
Dec 5 - Greece gets aid payment
08.52 So eurozone finance ministers are meeting in Brussels from 4pm today to decide on a rescue deal for Greece but it would appear that the leaders remain at odds on how to reduce the country's growing debt mountain.
At the meeting the ministers will try to finalise a deal to unlock the next tranche of the country's bail-out.
"We are headed for an agreement, but a partial one," one European diplomat told AFP, suggesting that the finance ministers could require yet another meeting before the end of November to address outstanding issues.
Greece approved laws on Monday to enforce budget targets and ensure privatisation proceeds are used to pay off debt, seeking to appease foreign lenders before the critical meeting of eurozone finance ministers on Tuesday.
Athens said the decrees - in addition to an austerity package passed this month - completed its obligations to lenders before Tuesday's Eurogroup meeting, which it hopes will unlock more aid to stave off bankruptcy.
Yannis Stournaras, Greece's finance minister, said that Greece was "totally ready" for the meeting.
"There are no longer any pending issues on our side. Greece is totally ready," he said.
08.33 Unsurprisingly markets in European edged lower in early trading following the news on France.
The FTSE 100 fell 0.2pc, while the CAC anmd IBEX were down 0.1pc. The DAX managed to buck the trend for now and was up 0.2pc.
08.28And there could be more bad news for France.
The lead analyst at Moody's for France's sovereign rating Dietmar Hornung has warned that the eurozone's second largest economy could be downgraded further if the Socialist government fails to implement announced reforms
He said:
We would downgrade the rating further in the event of additional material deterioration in France's economic prospects or in a scenario in which there were difficulties in implementing the announced reforms. 08.22 But first some news from late last night.
France has suffered a serious blow to its economic credentials after being stripped of its prized AAA credit rating by Moody’s.
The rating agency said France’s long-term economic growth had been hit by its inflexible labour market and low levels of innovation eroding its competitiveness and industrial base.
Moody's also flagged up the country’s exposure to the continuing eurozone crisis.
It warned the “predictability” of France’s resilence of further shocks in the eurozone was diminishing while the country’s exposure to the highly indebted countries such as Spain and Greece was disproportionately high.
In a statement Moody’s said:
Further shocks to sovereign and bank credit markets would further undermine financial and economic stability in France as well as in other euro area countries. The impact of such shocks would be expected to be felt disproportionately by more highly indebted governments such as France.
08.18 Later today eurozone finance ministers will meet yet again in Brussels to discuss Greece. Yesterday Germany said it was not possible that a deal would be reached today but Reuters reported that officials close to the deal expect a "political endorsement in principle" on unfreezing loans to Athens.
We will keep you updated on that through the day.
08.15 Good morning and welcome to the Debt Crisis live blog.
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In Finance »
EU budget talks collapse
The ten richest people in the world
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In Debt Crisis Live
Strikes across Europe
Greece gripped by 48-hour austerity strikes
What Obama must do next
EU budget talks collapse
Occupy Wall Street campaigners buy-up debt to abolish it
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Our EU bills could still rise £560m despite budget freeze
British taxpayers’ contributions to the European Union could rise even if David Cameron wins a freeze in overall Brussels’ spending, it emerged on Tuesday.
The Prime Minister could sign a budget deal that squeezes EU spending but leads to Britain footing a larger bill Photo: AP
By James Kirkup, Bruno Waterfield in Brussels
9:29PM GMT 20 Nov 2012
173 Comments
The Prime Minister will on Thursday begin negotiations on an EU budget that would cut spending, but could leave Britain paying more for its membership than it does now.
A Brussels summit will see Mr Cameron struggling against French demands to push up EU spending on farm subsidies.
Mr Cameron is under intense pressure to deliver on a promise to freeze the EU’s seven-year budget starting in 2014.
The Daily Telegraph understands that Mr Cameron’s negotiating position in the talks is focused on total spending by the EU as a whole, not the UK’s own share of the budget.
That means the Prime Minister could sign a budget deal that squeezes EU spending but leads to Britain footing a larger bill.
Related Articles
One proposal on the negotiating table in Brussels this week would lead to just such a result, diplomats have admitted.
The possibility arises from the complex rules used to calculate Britain’s annual rebate from the EU budget.
The last seven-year budget deal set a “payment ceiling” for the EU of €942.8 billion (£758.2 billion).
The Daily Telegraph has learnt that Herman Van Rompuy, the EU president, has proposed that payments in the next budget should be capped at €940 billion.
But over the previous seven-year budget round, the UK’s contributions averaged about €15.5 billion. Daily Telegraph calculations suggest Mr Van Rompuy’s deal would increase that by up to €700 million (£560 million a year).
UK sources said that Mr Van Rompuy’s proposal did not go far enough, and predicted his suggested payment limit would be pushed up by France and other members at the summit.
Britain is fighting against Mr Van Rompuy’s rebate changes, but sources said that, because of changes in the rebate negotiated by Tony Blair, and the costs of the EU’s eastward expansion, British payments were likely to be pushed up anyway. “The level of contributions goes up because of previous decisions. That is a fact,” said a source.
Many Conservative MPs had assumed that a freeze on overall spending would mean a freeze on UK contributions, but officials said that it was effectively impossible for the Prime Minister to negotiate the level of British payments as part of the budget talks.
A government spokesman confirmed that Mr Cameron was targeting total EU spending, not the UK’s net contribution.
The spokesman said: “We are looking to get the best deal for the UK taxpayer. That means holding down the total level of spending and protecting the UK’s rebate.”
British taxpayers’ contributions to the European Union could rise even if David Cameron wins a freeze in overall Brussels’ spending, it emerged on Tuesday.
The Prime Minister could sign a budget deal that squeezes EU spending but leads to Britain footing a larger bill Photo: AP
By James Kirkup, Bruno Waterfield in Brussels
9:29PM GMT 20 Nov 2012
173 Comments The Prime Minister will on Thursday begin negotiations on an EU budget that would cut spending, but could leave Britain paying more for its membership than it does now.
A Brussels summit will see Mr Cameron struggling against French demands to push up EU spending on farm subsidies.
Mr Cameron is under intense pressure to deliver on a promise to freeze the EU’s seven-year budget starting in 2014.
The Daily Telegraph understands that Mr Cameron’s negotiating position in the talks is focused on total spending by the EU as a whole, not the UK’s own share of the budget.
That means the Prime Minister could sign a budget deal that squeezes EU spending but leads to Britain footing a larger bill.
Related Articles
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20 Nov 2012
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20 Nov 2012
Cameron strolls towards the EU exit, leaving us none the wiser
19 Nov 2012
Iain Martin: is Ed Miliband’s EU policy credible?
17 Nov 2012
One proposal on the negotiating table in Brussels this week would lead to just such a result, diplomats have admitted.
The possibility arises from the complex rules used to calculate Britain’s annual rebate from the EU budget.
The last seven-year budget deal set a “payment ceiling” for the EU of €942.8 billion (£758.2 billion).
The Daily Telegraph has learnt that Herman Van Rompuy, the EU president, has proposed that payments in the next budget should be capped at €940 billion.
But over the previous seven-year budget round, the UK’s contributions averaged about €15.5 billion. Daily Telegraph calculations suggest Mr Van Rompuy’s deal would increase that by up to €700 million (£560 million a year).
UK sources said that Mr Van Rompuy’s proposal did not go far enough, and predicted his suggested payment limit would be pushed up by France and other members at the summit.
Britain is fighting against Mr Van Rompuy’s rebate changes, but sources said that, because of changes in the rebate negotiated by Tony Blair, and the costs of the EU’s eastward expansion, British payments were likely to be pushed up anyway. “The level of contributions goes up because of previous decisions. That is a fact,” said a source.
Many Conservative MPs had assumed that a freeze on overall spending would mean a freeze on UK contributions, but officials said that it was effectively impossible for the Prime Minister to negotiate the level of British payments as part of the budget talks.
A government spokesman confirmed that Mr Cameron was targeting total EU spending, not the UK’s net contribution.
The spokesman said: “We are looking to get the best deal for the UK taxpayer. That means holding down the total level of spending and protecting the UK’s rebate.”
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Re: New EC Thread
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FLASH_200_16_flash_expanding_0_DoFSCommand(command, args)
Telegraph.co.uk
Wednesday 21 November 2012
Eurozone finance ministers fail to agree Greek debt deal
Greece's international lenders failed for the second week running to agree how to get the country's debt down to a sustainable level and will have a third go at resolving their most intractable problem in six days' time.
The chairman of the Eurogroup Jean-Claude Juncker said eurozone finance ministers would meet again on Monday. Photo: Alamy
Reuters
6:18AM GMT 21 Nov 2012
54 Comments
After nearly 12 hours of talks through the night during which myriad options were discussed, eurozone finance ministers, the International Monetary Fund and the European Central Bank failed to reach a consensus, without which emergency aid cannot be disbursed to Athens.
"We are close to an agreement but technical verifications have to be undertaken, financial calculations have to be made and it's really for technical reasons that at this hour of the day it was not possible to do it in a proper way and so we are interrupting the meeting and reconvening next Monday," Eurogroup chairman Jean-Claude Juncker told reporters.
"There are no major political disagreements," he said.
Nonetheless, the euro extended its fall against the dollar in response.
A document prepared for the meeting and seen by Reuters declared that Greece's debt cannot be cut to 120 per cent of GDP by 2020, the level deemed sustainable by the IMF, unless euro zone member states write off a portion of their loans to Greece.
Related Articles
The 15-page document, circulated among ministers, set out in black-and-white how far off-track Greece is in reducing its debt to the IMF-imposed target, from a level of around 170 per cent of GDP now.
The document set out various ways Greece's debt could be reduced between now and 2020, but concluded they would not be enough without euro zone creditors taking a hit on their own holdings – something Germany and others have said would be illegal.
The document did say Greek debt could fall to 120 per cent of GDP two years later – in 2022 – without having to impose any losses on euro zone member states or forcing through a buy-back of Greek debt from private-sector bondholders.
But International Monetary Fund chief Christine Lagarde rejected such an extension at similar talks last week.
Without any corrective measures the document said Greek debt would be 144 per cent in 2020 and 133 per cent in 2022, figures first reported exclusively by Reuters last week.
"To bring the debt ratio down further, one needs to take recourse to measures that would entail capital losses or budgetary implications for euro area member states," the document says.
"Capital losses do not appear to be politically feasible and would jeopardise, at least in a number of member states, the political and public support for providing financial assistance."
Juncker said at a meeting a week ago that he wanted to extend the target date to reduce Greek debt by two years to 2022, but Lagarde insists the 2020 goal should stand.
The view of the IMF, which has played a role in both Greek bailouts so far, is critical since it provides international legitimacy and credibility for the efforts the euro zone is making. If the IMF were to withdraw its support for the bail-out programmes, it could have a deeply damaging market impact.
The document appeared designed in part to convince the IMF that Greek debt could be made sustainable just two years behind schedule if only it would soften its stance.
It remains possible that Lagarde could provide further wiggle room, but she is believed to favour the idea of euro zone member states taking a write-down on some of the loans extended to Greece in order to stick to the 120 per cent in 2020 goal.
Among the main measures under consideration to bring Greece's debt burden down as rapidly as possible is a debt buy-back under which Greece would offer to purchase bonds from private investors at a discount to their nominal value.
Several options are under consideration, officials have said and the document makes clear, including using about 10 billion euros to buy back bonds at between 30 and 35 cents in the euro.
There are also proposals to reduce the interest rate on loans already extended by euro zone countries to Greece, to impose a moratorium on interest payments and lengthen the maturities on loans, all of which would cut the debt burden.
Pressure for the euro zone to come up with a solution is high not just because Greece is running out of money and financial markets want a dependable solution, but because Athens has initiated virtually all the steps demanded of it to cut spending, raise taxes and overhaul its economy.
"Greece has delivered. Now it's up to us to deliver," Juncker said.
Because of the latest delay, the ministers were unable to give a go-ahead for the next tranche of up to 44 billion euros of emergency funds to be paid to Athens.
The payment would provide short-term relief to Athens, but it is long-term debt that is the core issue.
The European commissioner for economic affairs, Olli Rehn, said as he arrived for the meeting that the euro zone should be ready to do more for Greece in the coming years, an apparent nod to the idea of government-sector debt write downs.
"It's essential now that we take a decision on a set of credible measures on debt sustainability and, at the same time, we need to be ready to take further decisions in the light of future developments," Rehn said.
He did not elaborate, but the idea of a haircut on official loans is off the table for now because many countries, including Germany, see it as politically and legally impossible.
Telegraph.co.uk
Wednesday 21 November 2012
Eurozone finance ministers fail to agree Greek debt deal
Greece's international lenders failed for the second week running to agree how to get the country's debt down to a sustainable level and will have a third go at resolving their most intractable problem in six days' time.
The chairman of the Eurogroup Jean-Claude Juncker said eurozone finance ministers would meet again on Monday. Photo: Alamy
Reuters
6:18AM GMT 21 Nov 2012
54 Comments After nearly 12 hours of talks through the night during which myriad options were discussed, eurozone finance ministers, the International Monetary Fund and the European Central Bank failed to reach a consensus, without which emergency aid cannot be disbursed to Athens.
"We are close to an agreement but technical verifications have to be undertaken, financial calculations have to be made and it's really for technical reasons that at this hour of the day it was not possible to do it in a proper way and so we are interrupting the meeting and reconvening next Monday," Eurogroup chairman Jean-Claude Juncker told reporters.
"There are no major political disagreements," he said.
Nonetheless, the euro extended its fall against the dollar in response.
A document prepared for the meeting and seen by Reuters declared that Greece's debt cannot be cut to 120 per cent of GDP by 2020, the level deemed sustainable by the IMF, unless euro zone member states write off a portion of their loans to Greece.
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12 Nov 2012
Debt crisis: Eurozone finance ministers fail to agree Greek debt deal - live
21 Nov 2012
The 15-page document, circulated among ministers, set out in black-and-white how far off-track Greece is in reducing its debt to the IMF-imposed target, from a level of around 170 per cent of GDP now.
The document set out various ways Greece's debt could be reduced between now and 2020, but concluded they would not be enough without euro zone creditors taking a hit on their own holdings – something Germany and others have said would be illegal.
The document did say Greek debt could fall to 120 per cent of GDP two years later – in 2022 – without having to impose any losses on euro zone member states or forcing through a buy-back of Greek debt from private-sector bondholders.
But International Monetary Fund chief Christine Lagarde rejected such an extension at similar talks last week.
Without any corrective measures the document said Greek debt would be 144 per cent in 2020 and 133 per cent in 2022, figures first reported exclusively by Reuters last week.
"To bring the debt ratio down further, one needs to take recourse to measures that would entail capital losses or budgetary implications for euro area member states," the document says.
"Capital losses do not appear to be politically feasible and would jeopardise, at least in a number of member states, the political and public support for providing financial assistance."
Juncker said at a meeting a week ago that he wanted to extend the target date to reduce Greek debt by two years to 2022, but Lagarde insists the 2020 goal should stand.
The view of the IMF, which has played a role in both Greek bailouts so far, is critical since it provides international legitimacy and credibility for the efforts the euro zone is making. If the IMF were to withdraw its support for the bail-out programmes, it could have a deeply damaging market impact.
The document appeared designed in part to convince the IMF that Greek debt could be made sustainable just two years behind schedule if only it would soften its stance.
It remains possible that Lagarde could provide further wiggle room, but she is believed to favour the idea of euro zone member states taking a write-down on some of the loans extended to Greece in order to stick to the 120 per cent in 2020 goal.
Among the main measures under consideration to bring Greece's debt burden down as rapidly as possible is a debt buy-back under which Greece would offer to purchase bonds from private investors at a discount to their nominal value.
Several options are under consideration, officials have said and the document makes clear, including using about 10 billion euros to buy back bonds at between 30 and 35 cents in the euro.
There are also proposals to reduce the interest rate on loans already extended by euro zone countries to Greece, to impose a moratorium on interest payments and lengthen the maturities on loans, all of which would cut the debt burden.
Pressure for the euro zone to come up with a solution is high not just because Greece is running out of money and financial markets want a dependable solution, but because Athens has initiated virtually all the steps demanded of it to cut spending, raise taxes and overhaul its economy.
"Greece has delivered. Now it's up to us to deliver," Juncker said.
Because of the latest delay, the ministers were unable to give a go-ahead for the next tranche of up to 44 billion euros of emergency funds to be paid to Athens.
The payment would provide short-term relief to Athens, but it is long-term debt that is the core issue.
The European commissioner for economic affairs, Olli Rehn, said as he arrived for the meeting that the euro zone should be ready to do more for Greece in the coming years, an apparent nod to the idea of government-sector debt write downs.
"It's essential now that we take a decision on a set of credible measures on debt sustainability and, at the same time, we need to be ready to take further decisions in the light of future developments," Rehn said.
He did not elaborate, but the idea of a haircut on official loans is off the table for now because many countries, including Germany, see it as politically and legally impossible.
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Catalonian election
A dangerous leap into the abyss
21 November 2012El País Madrid
Arthur Mas, president of Spain’s autonomous region of Catalonia.
Kap
Central to the Catalonia’s November 25 regional elections will be the question of secession from Spain, with President Artur Mas aiming for an absolute majority that would legitimise a referendum on this issue. But the vehemence of the campaign is such that events could easily spin out of control, worries author Javier Cercas.
Javier Cercas
The recent upsurge of secessionist feeling in Catalonia has me perplexed and apprehensive. I have not written about it here, because I assume the readers of this column tend to share my feelings, and why preach to the converted? Yet on the occasion of my recent novel I have been interviewed and asked questions on this point, and have said more or less the following.
I understand why some people are angry and desperate, and think that things could hardly be worse. I can only answer with a certainty and a confession. The certainty is that we could, indeed, be worse off. The confession is that I like adventures, but only in fiction. Not in politics, where I am a fierce partisan of leaden boredom, like that of Swiss or Scandinavian politics.
So when I hear our premier Mas say that the road to independence runs through "unknown terrain," my hair stands on end. Writers and scientists have an obligation to boldly go where none have gone before; but for politicians, this ought to be taboo. If in the dark unknown the writer falls into the abyss, so what? But if a politician falls into the abyss, he takes all the rest of us with him (and the abyss is the abyss of history). I don't know whether I need to add that I am not a Catalan nationalist, nor a secessionist.
Nationalism incompatible with what the left stands for
That's about it. Since I said this, I have been amazed at the number of people who have congratulated me for uttering these words. One historian who specializes in Catalonia reminded me that Pierre Vilar coined the word "unanimism" in reference to those conjunctures when fear silences all dissidence, and creates an illusory sense of unanimity, and confessed to a fear of saying in public that she did not partake of this secessionist fervor.
I was amazed that there are still holes and corners where people fail to understand that nationalism – be it of the Spanish or the regional kind – is incompatible with what the left stands for. And there are holes and corners where it is not understood that one thing is Catalan nationalism, the -ism of a few, and another thing the Catalan language, which belongs to all of us.
I am amazed at the general amazement caused by [José Manuel] Lara when he said that his publishing house, Planeta [Spain’s largest publishing house], would pack up and leave an independent Catalonia; and amazed when the leader of the secessionist party ERC [Esquerra Republicana de Catalunya, independentist left party] now says that an independent Catalonia would be bilingual, when they have always insisted that bilingualism leads to the extinction of the Catalan language.
In history nothing is impossible
I am amazed at the ingenuity of Artur Mas, who overnight has caused the Catalans to stop blaming him for their ills, and blame them all on Spain. I am amazed and appalled when a former premier of Extremadura [of the regional government] says that those originally from the southwest region now living in Catalonia ought to be sent back to Extremadura, as if we were cattle; and when the Catalan premier, whose job it is to make laws and see that they are obeyed, says he would ignore the law.
In this context, it amazes me less to see a writer almost calling for armed insurrection, or a politician [Alejo Vidal Quadras, Popular Party MEP] calling for Catalonia to be placed under the rule of the Civil Guard. But what most amazes me is when apparently reasonable people maintain that the secession of Catalonia would take place in an atmosphere of cordial good feeling and without traumas, and when almost everyone seems to believe it is impossible that the situation might degenerate into violence.
Dear God, have we not yet learned that in history nothing is impossible, and that great changes have almost always happened by means of fire and sword? Have we once again grown so senseless and pusillanimous as to be incapable of finding a civilized way out of this muddle?
A dangerous leap into the abyss
21 November 2012El País Madrid
Arthur Mas, president of Spain’s autonomous region of Catalonia.
Kap
Central to the Catalonia’s November 25 regional elections will be the question of secession from Spain, with President Artur Mas aiming for an absolute majority that would legitimise a referendum on this issue. But the vehemence of the campaign is such that events could easily spin out of control, worries author Javier Cercas.
Javier Cercas
The recent upsurge of secessionist feeling in Catalonia has me perplexed and apprehensive. I have not written about it here, because I assume the readers of this column tend to share my feelings, and why preach to the converted? Yet on the occasion of my recent novel I have been interviewed and asked questions on this point, and have said more or less the following.
I understand why some people are angry and desperate, and think that things could hardly be worse. I can only answer with a certainty and a confession. The certainty is that we could, indeed, be worse off. The confession is that I like adventures, but only in fiction. Not in politics, where I am a fierce partisan of leaden boredom, like that of Swiss or Scandinavian politics.
So when I hear our premier Mas say that the road to independence runs through "unknown terrain," my hair stands on end. Writers and scientists have an obligation to boldly go where none have gone before; but for politicians, this ought to be taboo. If in the dark unknown the writer falls into the abyss, so what? But if a politician falls into the abyss, he takes all the rest of us with him (and the abyss is the abyss of history). I don't know whether I need to add that I am not a Catalan nationalist, nor a secessionist.
Nationalism incompatible with what the left stands for
That's about it. Since I said this, I have been amazed at the number of people who have congratulated me for uttering these words. One historian who specializes in Catalonia reminded me that Pierre Vilar coined the word "unanimism" in reference to those conjunctures when fear silences all dissidence, and creates an illusory sense of unanimity, and confessed to a fear of saying in public that she did not partake of this secessionist fervor.
I was amazed that there are still holes and corners where people fail to understand that nationalism – be it of the Spanish or the regional kind – is incompatible with what the left stands for. And there are holes and corners where it is not understood that one thing is Catalan nationalism, the -ism of a few, and another thing the Catalan language, which belongs to all of us.
I am amazed at the general amazement caused by [José Manuel] Lara when he said that his publishing house, Planeta [Spain’s largest publishing house], would pack up and leave an independent Catalonia; and amazed when the leader of the secessionist party ERC [Esquerra Republicana de Catalunya, independentist left party] now says that an independent Catalonia would be bilingual, when they have always insisted that bilingualism leads to the extinction of the Catalan language.
In history nothing is impossible
I am amazed at the ingenuity of Artur Mas, who overnight has caused the Catalans to stop blaming him for their ills, and blame them all on Spain. I am amazed and appalled when a former premier of Extremadura [of the regional government] says that those originally from the southwest region now living in Catalonia ought to be sent back to Extremadura, as if we were cattle; and when the Catalan premier, whose job it is to make laws and see that they are obeyed, says he would ignore the law.
In this context, it amazes me less to see a writer almost calling for armed insurrection, or a politician [Alejo Vidal Quadras, Popular Party MEP] calling for Catalonia to be placed under the rule of the Civil Guard. But what most amazes me is when apparently reasonable people maintain that the secession of Catalonia would take place in an atmosphere of cordial good feeling and without traumas, and when almost everyone seems to believe it is impossible that the situation might degenerate into violence.
Dear God, have we not yet learned that in history nothing is impossible, and that great changes have almost always happened by means of fire and sword? Have we once again grown so senseless and pusillanimous as to be incapable of finding a civilized way out of this muddle?
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Debt crisis: EU budget solution may not happen until 2013 - live
German chancellor Angela Merkel has said it's possible EU leaders will need to meet again in early 2013 to clinch a solution on the EU budget, as leaders head to Brussels for the start of a two-day summit which starts tomorrow.
Angela Merkel said there is a "good chance" of a Greek deal at the next meeting of its international lenders on Monday, after they failed to reach an agreement last night. Photo: Reuters
By Rebecca Clancy
5:00PM GMT 21 Nov 2012
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2012-11-21 17:02:14.0
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• Eurozone finance ministers fail to agree Greek debt deal
• UK public borrowing jumps in blow for Chancellor
• BoE rate-setters rule out cut and reject QE, minutes show
• Merkel says there's a 'good chance' of a Greek deal on Monday
• Cameron says further cuts needed in EU budget ahead of Summit
Latest
17.00Some reaction to markets today.
Angus Campbell, Capital Spreads
Even though a deal on Greece is yet to be finalised investors have become used to politicians kicking the can down the road and ultimately it’s known that something has to be achieved next week.
With the last couple of sessions seeing the FTSE move sideways there still seems to be a great deal of apprehension within the market place and you can feel the tension which has the potential to suddenly send markets in reverse again.
At least for now the sellers have been kept at bay both here and across the pond and those lucky people who bought stocks either last Friday or early on Monday are probably happy to sit tight.
With the US on holiday for Thanksgiving from tomorrow for the rest of the week we could see a very muted couple of days ahead for indices with even lower volumes traded than we've seen so far this week.
16.50 European markets are now closed and all finished up, as disappoint over the failed Greek aid talks was replaced by hope for Monday's meeting.
The FTSE 100 finished up 0.1pc, the DAX was up 0.2pc, the IBEX was up 0.3pc and the CAC was up 0.4pc.
16.29 However, the number of EU staff taking part in the strike seems to be rather low, according to the Telegraph's Brussels correspondent.
Twitter: Bruno Waterfield - #EUbudget: official tells me that just 2% of #EU staff in his department out on strike - what a hopeless lot
16.20 Back to Brussels now.
EU staff representatives have gathered to demonstrate in favour of a balanced and solidarity-oriented European budget, outside the European Commission headquarters in Brussels on Wednesday.
Staff of the European institutions gathered to call out both the European Council and the European Commission about the choices impacting the future of the European Union.
In macroeconomic and financial major crisis, the response to the challenges can only come from a collective, solidarity-oriented action of the Member States, driven and coordinated across the whole Union, they said.
16.03 Greece's economic recovery will also be knocked by the news that Ikea is slashing the wages of its staff in the country by between 11 and 15pc.
eKathimerini.com has reported workers have worked out of the Swedish home furnishings company's stores after they were informed that there wages were to be cut.
The announcement of wage cuts at IKEA comes just a few days after local rival Neoset announced that it would be filing for bankruptcy.
15.44 More bad news for Greece (see 14.20).
Citigroup is to shut almost half its branch network in the country, as retail banking activity has dried up because of the country's debt crisis.
Citi, the last major international bank with a countrywide presence in Greece, will cut its network to 21 branches from 37 by shutting all branches outside Athens and Thessaloniki, it said in a statement on Wednesday.
About 170 jobs will go, nearly a tenth of the lender's total workforce in the country.
A spokeswoman for Citi's Greek operations said:
The current business and economic environment requires adaptability... we will focus more on investment, deposit products and credit cards.
Other foreign banks such as Credit Agricole and Societe Generale have sold the Greek businesses they bought during the country's economic boom.
15.13 More analysis looking ahead to the two-day EU Summit which starts in Brussels tomorrow.
German chancellor Angela Merkel said earlier today (see 11.10) that it's possible EU leaders will need to meet again in early 2013 to clinch solution on budget.
Our very own Bruno Waterfield notes that David Cameron is the first EU leader in for talks with Mr Van Rompuy and Jose Manuel Barroso, the European Commission President, on Thursday morning, with no problems predicted (see 14.34).
He says the prime minister will claim victory on a headline freeze for the EU budget while blaming any increase to what Britain actually has to pay on the previous Labour government.
Jan Dehn, Co Head of Research at Ashmore Investment Management, has said that while the summit may prove noisey, it is largely irrelevant to the fiscal health of its member states.
He said:
The broad trend is for more national spending to migrate to the EU as the European Union continues to integrate. Rising EU spending presents specific political challenges for countries such as the UK, whose government is undertaking austerity and does not support closer fiscal integration.
However, the EU budget itself is not the cause of Europe's fiscal problems, which lie squarely with national governments, whose debts are still rising despite efforts to reform. These problems are the result of years of fiscal profligacy.
Europe's long-term path is towards fiscal union. The next step in this process is likely to be EU-wide banking regulation as a possible pre-cursor for a European version of TARP (forced recapitalization of Europe's banks). This will further increase Europe already excessive debt burden.
14.45 Some good news for Italy's prime minister Mario Monti. His government easily won a confidence vote in the lower house of parliament on its latest budget plan by 426 votes to 88.
This paves the way for a sales tax hike to help mend public finances.
The budget plan, called Stability Law, is central to Prime Minister Mario Monti's efforts to lower Italy's public deficit to 1.8pc of output next year from a targeted 2.6pc in 2012.
The Stability Law is expected to be one of the final pieces of important legislation approved under Monti before the country's government election next year.
14.34 Ahead of Cameron's arrival in Brussels for the EU Summit, the Telegraph's Brussels Correspondent Bruno Waterfield has this piece of analysis on what Britian can expect out of the two-day meeting.
It is a tradition as old as the 40 years that Britain has been in the EU.
A Prime Minister heading to Brussels for difficult summit negotiations over the long-term financing of the EU draws a life-or-death red line in the sand.
David Cameron has vowed to veto a proposal by Herman Van Rompuy, the EU president, to cut Britain’s annual refund from Brussels by £6 billion.
Cloaking himself in the mantle of Margaret Thatcher, who won the original British rebate in 1984, Mr Cameron appears as resolute defender of the national interest.
Except the rebate red line is more of a straw man, a piece of political furniture concealing a classic piece of misdirection, a sleight of hand.
Mr Van Rompuy has proposed a rebate cut but, as it is protected by a built in British veto, it is a non-flyer to begin with. It’s a helpful piece of the summit stage set. Mr Cameron can declare it a red line and declare an inevitable victory.
Meanwhile, as the public focuses on the rebate, the political prestidigitators in Whitehall and Downing Street are pulling off a conjuring trick.
As the Daily Telegraph revealed on Wednesday morning, the substance of Mr Cameron’s summit strategy is to drop his demand made in 2010 (and restated last month) for a cut in Britain’s annual contributions as payments to Brussels coffers.
Instead, Britain will sign off on a reduction in the “payment appropriations ceiling” allowed for the period between 2014 and 2020, £755 billion is the figure doing the rounds. Washed down with some Treasury number soup and the fact that actual, real annual payments are usually less than the ceiling, the U-turn can be spun as a “real freeze” to spending.
As Mr Cameron rails against Mr Van Rompuy’s rebate cut, diplomats tell another story: that Britain is ready to do a deal that will see its contributions rise while the overall EU budget level frozen.
In other words, he will claim victory on a headline freeze for the EU budget while blaming any increase to what Britain actually has to pay on the previous Labour government.
The Prime Minister is the first EU leader in for talks with Mr Van Rompuy and Jose Manuel Barroso, the European Commission President, on Thursday morning. Diplomats do not predict any problems.
“Cameron is already thinking how to defend the deal, meaning that psychologically Britain is pretty much in the bag,” said a diplomat.
14.20 Sport in Greece has been hit hard a result of the financial crisis.
Today Hellenic Swimming Federation (KOE) president Dimitris Diathesopoulos announced that Greece will not compete in the European short-course swimming championships for the first time in 16 years due to financial problems.
Diathesopoulos told Reuters Greece would miss the championships starting in Chartres, France, on Thursday.
He said:
We had decided in the summer that we would not attend the European event this year, mainly due to financial reasons.
We programmed this according to our budget constraints and the fact that the world championships are so close.
Of course we are disappointed that we will miss out for the first time since 1996 after so many successive appearances, but these days a lot of things are happening for the first time in Greece's history.
The announcement comes two weeks after the Greek government's decision to slash funding for sports federations which has forced the Hellenic Olympic Committee (HOC) to announce that a host of federations will stop operating from January 1 next year unless the state revises its plans for funding in the 2013 budget.
13.57 Over to Spain now. Its central bank governor Luis Maria Linde has said the economy shows no signs of recovery and the country risks missing budget deficit targets this year and in 2013 as a deep recession drags on.
In a speech to the Senate, Linde also said that European Central Bank monetary policy solutions would only buy time for the eurozone, which must also address underlying problems.
Linde told lawmakers on Wednesday that the Spanish economy was still not showing signs of strengthening, although he offered a more upbeat view later when talking to reporters.
He said:
The process of adjustment in the Spanish economy is at a delicate point, in which an improvement in activity and job creation is yet to be seen.
The available information does not allow us to rule out the possibility of a deviation (from deficit reduction targets).
This is bad news for Spain and will do nothing to stop many who believe the country will need to ask for a bailout from Europe.
13.40 Back to Greece and Democratic Left leader and coalition partner Fotis Kouvelis has called on the country’s partners and creditors to “immediately live up to their commitments.”, eKathimerini.com reports. It writes:
Kouvelis’s remarks were made following a meeting between Greece’s partners and creditors on Tuesday which failed to reach conclusive decisions regarding the country’s debt sustainability and pledged bailout aid.
“Greece has taken all necessary measures,” noted Kouvelis, who added that everyone recognized the efforts made by Greek society and that it was now up to the eurozone and the International Monetary Fund to carry out their own pledges.
Kouvelis reiterated the need for a deal with regard to a transitional agreement between the IMF and the eurozone regarding measures that would reduce the Greek debt's additional charges.
He added that Greece’s European partners ought to continue the funding program and reducing the debt in order for Greece to get back on the growth track and render the debt’s management sustainable on a social level.
13.07 The German finance minister Wolfgang Schaeuble has been speaking more on Greece in the last few moments.
Reuters has the pointers of what he said:
• working intensively with the IMF, confident Greek financing gap can be filled.
• we agree with IMF that there will be a debt buyback programme
• German government favours increasing EFSF (bailout fund) programme for Greece
• believes Bundestag can decide on Greece at end of next week
• some other eurozone states favour lowering interest rates of first Greek aid programme
• none of Greek aid measures under consideration would affect German 2013 budget
• would be good sign if eurogroup decides on Greek aid next Monday
12.45 A quick look at lunch time markets, which have recovered from earlier losses.
The FTSE 100 and DAX are now flat, while the IBEX and CAC are up 0.1pc.
12.30 Finnish Prime Minister Jyrki Katainen has also been speaking ahead of the EU Summit to reporters in Helsinki.
Katainen said the 27-nation European Union must rein in its budget during the crisis.
Bloomberg has the pointers:
• “It can’t be so that the EU budget grows in these tough economic times".
• “Not realistic” to expect Finnish net contribution to fall, must try to limit how much it increases.
• Declined to comment on Greek aid talks
12.21 Italy, on the other hand, feels there is a "significant possibility" that a deal will be reached on the EU budget at the Summit this week.
At a press conference in Rome, Italy's European Affairs Minister Enzo Moavero said:
I think there is a significant possibility of an agreement at this Council meeting.
Only 24 hours ago Moavero said Italy was ready to veto any deal that was not in the country's interests.
Italy has opposed moves led by Britain and other northern European countries for cuts to the EU's trillion euro budget.
12.07 David Cameron is travelling to Brussels later today ahead of the EU Summit tomorrow and has reiterated his stance that the cuts in spending in the EU budget do not go far enough.
A spokesman for the prime minister said:
While [Herman] Van Rompuy's proposals are a step in the right direction, we believe there are still areas where further cuts can be made.
EU chief Van Rompuy last week tabled a draft EU budget aiming to mollify Britain, which wants deep reductions to EU spending plans.
Van Rompuy's draft would reduce the roughly €1trn budget for 2014-2020 proposed by the European Commission by about €80bn.
11.40 Sticking with Alexis Tsipras, eKathimerini.com is repoting that he is due to meet with the ambassadors representing all 27 European Union member states next Tuesday in a bid to boost ties between his party, which is leading in opinion polls, and European representatives in Athens.
The website writes:
According to sources, the initiative for the meetings was taken by the EU’s Cypriot presidency and is part of broader European efforts to develop ties with parties across the political spectrum.
Tsipras, who on Thursday is to travel to Barcelona for talks with leftist politicians ahead of regional elections that could bring independence for Catalonia, has repeatedly claimed that the bailout funding being sought by Greece will not be used to prop up the debt-wracked economy.
On Tuesday, in an interview with the Al Jazeera television channel, he said Greece needed foreign aid but said that the installment due for release in coming weeks would go straight to local banks before these had been cleared of their bad loans, which he likened to “throwing water into a bottomless barrel.”
11.26 Back in Greece, Alexis Tsipras, head of the opposition party Syriza, has been blasting Greek PM Samaras for becoming a "tool" for Merkel.
Speaking in parliament Tsipras said Samaras had lost his "last ounce of respectability".
Deputy editor of Greece's daily English language newspaper Kathimerini, Nick Malkoutzis has been watching it unfold.
Twitter: Nick Malkoutzis - #Tsipras: Europe finds itself face to face with the dead-ends it has created through its policies
Twitter: Nick Malkoutzis - #Tsipras: Disbursement of the next loan will not secure the sustainability of Greek debt. The Eurogroup even considered a repayment freeze
Twitter: Nick Malkoutzis - #Tsipras: What is the Greek position on debt, on these key developments in Europe?
Twitter: Nick Malkoutzis - #Tsipras: Samaras refused to use the negotiating power he's given by the disagreement between lenders
Twitter: Nick Malkoutzis - #Tsipras: Samaras has lost the last ounce of respectability by claiming Greece will run out of money on November 16
Twitter: Nick Malkoutzis - #Tsipras: Samaras has become a pre-election tool for Merkel, who does not want to admit that she has made serious mistakes
11.16 Sticking with the EU budget, Portugal could veto it tomorrow as elements are "unacceptable" and it is not balanced.
Portugal's Prime Minister Pedro Passos Coelho told parliament the EU budget must not reduce funding for developing peripheral areas of Europe and has to ensure continued convergence of income levels across the region.
"This European budget proposal is not balanced and contains elements that are not acceptable," he said.
He added that he backed the initial European Commission's budget proposal and thought it was still possible to find a balanced solution.
11.10 Angela Merkel has been speaking ahead of the EU Summit tomorrow where leaders will discuss the EU budget.
Well she has said it's possible that EU leaders will need to meet again in early 2013 to clinch a solution on the budget.
Reuters has posted some points from the speech:
• Merkel says idea that we can solve Europe's problems for good is wrong. Must continue step-by-step approach.
• Merkel says Europe is in a serious situation. Crisis cannot be solved in a couple of years.
• Merkel says there are chances of solutions on Greece on Monday.
• Merkel says possible EU leaders will need to meet again in early 2013 to clinch solution on budget.
10.56 The Greek prime minister Antonis Samaras isangry about the eurogroup's failure to reach a deal and repeated delays in releasing the aid, pointing out that the debt-laden country has done what has been asked of it, now its lenders must do the same.
He said:
Greece did what it had committed it would do . Our partners, together with the IMF, also have to do what they have taken on to do.
Any technical difficulties in finding a technical solution do not justify any negligence or delays.
10.45 However, Merkel's Social Democrat (SPD) election rival Peer Steinbrueck said Greece would not be able to return to capital markets this decade and that its financing gap could not be filled with piecemeal steps.
Talking in parliament in a debate on the German budget he said
It is obvious that Greece will not in this decade be able to return to the capital markets under viable conditions.
He added that Merkel's government should delay a vote on the German budget until it was clear what was happening with Greece.
10.35 Back to Greece now.
German Chancellor Angela Merkel has told lawmakers at a closed-door meeting that lower interest rates and an expanded European Financial Stability Fund (EFSF) could fill Greece's financing gap, a source at the session told Reuters.
Merkel told the meeting that EFSF guarantees could be raised by €10bn and that Germany would take its share in that, said the participant in the meeting.
Different euro zone states could help Greece in different ways, she said, according to the source.
Merkel addressed the lawmakers after European finance ministers, the European Central Bank and International Monetary Fund (IMF) failed to reach a deal to free up new aid for Greece.
10.14 Some reaction to those worse-than-expected borrowing numbers (see 10.08) and the Bank of England minutes (see 09.45).
Victoria Clarke, Investec
Public finances data is pretty disappointing, coming with a significant overshoot of expectations. This will be concerning for the Chancellor and give him a bit more work to do for the Autumn statement in terms of bringing the UK finances back on track.
The BoE vote isn't hugely surprising. The MPC have been briefed on the government's intention to normalize the cash management arrangements for the asset purchase facility, and that was effectively an easing of monetary policy.
Given that that was an easing, I would say that 8/9 is not indicative of the committee's inclination to ease policy at a future date.
Vicky Redwood, Capital Economics
October's UK public finance figures - the last before the Autumn Statement in a fortnight's time - show that government borrowing is still running significantly above last year's levels. If the OBR assumes that this trend continues, it will have to revise up its forecast for this year from 120 to 130 billion pounds. Even if the OBR assumes that the trend improves a bit, it will still be pretty touch and go whether the Chancellor will be expected to meet his fiscal rules without increasing his austerity measures further.
The minutes of this month's MPC meeting show that the vote to leave QE unchanged was 8-1, as we expected, with only David Miles wanting an increase of 25 bilion pounds. However, like the Inflation Report, the minutes leave the door open for more QE.
Even after taking account of the extra monetary loosening from the transfer of the APF cash to the Treasury, a case could be made for a further easing in monetary conditions. We still expect more QE in February.
Howard Archer, IHS Global
The minutes of the November MPC meeting keep open the possibility that the committee will push the Quantitative Easing button again should the economy fail to pick up and if underlying inflationary pressures appear to be broadly contained.
With economic recovery currently looking feeble, fragile and far from guaranteed, we continue to lean towards the view that the Bank of England will ultimately decide to give the economy a further helping hand with a final £50 billion of QE. While this is unlikely to happen in December, it could well occur in the first quarter of 2013 if data and surveys over the coming weeks point to the economy flirting with renewed contraction.
10.08 The UK's borrowing figures were also out this morning, which show that public borrowing was worse than expected.
The Office for National Statistics said the government's preferred measure, public sector net borrowing excluding financial sector interventions, came in at £8.6bn in October, up from £5.9bn in October 2011.
This was well above economists' average forecast of £6bn, and higher even than the most pessimistic estimate in a Reuters poll of 19 analysts.
A near 10pc fall in corporation tax receipts, in a month when there is usually a heavy inflow, as well as a rise in day-to-day departmental spending, accounted for much of the year-on-year increase.
The figures also showed that the Britain's government borrowed much more than expected in October, reducing the chance that the government will meet its 2012/13 deficit reduction goal.
The data are the last figures before George Osborne presents his pre-budget statement on December 5 and - after a positive surprise in September - extend the borrowing overshoots seen for most of the tax year.
09.45 In the UK the Bank of England has released the minutes from the rate-setting Monetary Policy Committee in November.
The minutes show that one (David Miles) of the nine members nine voted to increase the quantitative easing programme by £25bn to bring it to a total of £400bn. The remaining 8 all voted to hold it at £375bn.
The minutes stated that members views differed over the exact impact of the MPC's asset purchases, however they did agree that demand and output would have been "significantly weaker in their absence".
The committe said there "remained considerable further scope" for asset purchases to lower long-term yields on government and corporate debt and support other asset prices, but said there was a question over the magnitude of the impact of lower yields and higher asset prices on the broader economy at the current juncture.
The Committee also discussed the effectiveness of reducing the bank rate from its record low of 0.5pc, where it has been since March 2009, and concluded that a reduction was unlikely in the foreseeable future. Therefore the vote to maintain the current bank rate was unanimous.
The minutes stated:
Analysis had concluded that a further cut in Bank Rate would be likely to cause a reduction in the profitability of some lenders, especially building societies, because of the prevalence of loans with interest terms contractually or closely linked to Bank Rate. That would weaken their balance sheets and they might have to respond by increasing other loan rates or restricting lending.
Viewed against the backdrop of the Funding for Lending Scheme (FLS), and the potential for building societies to play a material role in increasing lending, the Committee judged that it was unlikely to wish to reduce Bank Rate in the foreseeable future.
09.28 President of the European Council Herman Van Rompuy's office have been speaking ahead of the Summit tomorrow. The Telegraph's Brussels correspondent Bruno Waterfield has been tweeting about it.
greement could not be reached at today's meeting , another meeting is scheduled for Monday.==========
------------------------------------------------------
"As Mr Cameron rails against Mr Van Rompuy’s rebate cut, diplomats tell another story: that Britain is ready to do a deal that will see its contributions rise while the overall EU budget level frozen.
In other words, he will claim victory on a headline freeze for the EU budget while blaming any increase to what Britain actually has to pay on the previous Labour government."
Cameron really is a devious b***er, the sooner he is ousted the better.
German chancellor Angela Merkel has said it's possible EU leaders will need to meet again in early 2013 to clinch a solution on the EU budget, as leaders head to Brussels for the start of a two-day summit which starts tomorrow.
Angela Merkel said there is a "good chance" of a Greek deal at the next meeting of its international lenders on Monday, after they failed to reach an agreement last night. Photo: Reuters
By Rebecca Clancy
5:00PM GMT 21 Nov 2012
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2012-11-21 17:02:14.0
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• Eurozone finance ministers fail to agree Greek debt deal
• UK public borrowing jumps in blow for Chancellor
• BoE rate-setters rule out cut and reject QE, minutes show
• Merkel says there's a 'good chance' of a Greek deal on Monday
• Cameron says further cuts needed in EU budget ahead of Summit
Latest
17.00Some reaction to markets today.
Angus Campbell, Capital Spreads
Even though a deal on Greece is yet to be finalised investors have become used to politicians kicking the can down the road and ultimately it’s known that something has to be achieved next week. With the last couple of sessions seeing the FTSE move sideways there still seems to be a great deal of apprehension within the market place and you can feel the tension which has the potential to suddenly send markets in reverse again.
At least for now the sellers have been kept at bay both here and across the pond and those lucky people who bought stocks either last Friday or early on Monday are probably happy to sit tight.
With the US on holiday for Thanksgiving from tomorrow for the rest of the week we could see a very muted couple of days ahead for indices with even lower volumes traded than we've seen so far this week.
16.50 European markets are now closed and all finished up, as disappoint over the failed Greek aid talks was replaced by hope for Monday's meeting.
The FTSE 100 finished up 0.1pc, the DAX was up 0.2pc, the IBEX was up 0.3pc and the CAC was up 0.4pc. 16.29 However, the number of EU staff taking part in the strike seems to be rather low, according to the Telegraph's Brussels correspondent.
Twitter: Bruno Waterfield - #EUbudget: official tells me that just 2% of #EU staff in his department out on strike - what a hopeless lot
16.20 Back to Brussels now.
EU staff representatives have gathered to demonstrate in favour of a balanced and solidarity-oriented European budget, outside the European Commission headquarters in Brussels on Wednesday.
Staff of the European institutions gathered to call out both the European Council and the European Commission about the choices impacting the future of the European Union.
In macroeconomic and financial major crisis, the response to the challenges can only come from a collective, solidarity-oriented action of the Member States, driven and coordinated across the whole Union, they said.
16.03 Greece's economic recovery will also be knocked by the news that Ikea is slashing the wages of its staff in the country by between 11 and 15pc.
eKathimerini.com has reported workers have worked out of the Swedish home furnishings company's stores after they were informed that there wages were to be cut.
The announcement of wage cuts at IKEA comes just a few days after local rival Neoset announced that it would be filing for bankruptcy.
15.44 More bad news for Greece (see 14.20).
Citigroup is to shut almost half its branch network in the country, as retail banking activity has dried up because of the country's debt crisis.
Citi, the last major international bank with a countrywide presence in Greece, will cut its network to 21 branches from 37 by shutting all branches outside Athens and Thessaloniki, it said in a statement on Wednesday.
About 170 jobs will go, nearly a tenth of the lender's total workforce in the country.
A spokeswoman for Citi's Greek operations said:
The current business and economic environment requires adaptability... we will focus more on investment, deposit products and credit cards. Other foreign banks such as Credit Agricole and Societe Generale have sold the Greek businesses they bought during the country's economic boom.
15.13 More analysis looking ahead to the two-day EU Summit which starts in Brussels tomorrow.
German chancellor Angela Merkel said earlier today (see 11.10) that it's possible EU leaders will need to meet again in early 2013 to clinch solution on budget.
Our very own Bruno Waterfield notes that David Cameron is the first EU leader in for talks with Mr Van Rompuy and Jose Manuel Barroso, the European Commission President, on Thursday morning, with no problems predicted (see 14.34).
He says the prime minister will claim victory on a headline freeze for the EU budget while blaming any increase to what Britain actually has to pay on the previous Labour government.
Jan Dehn, Co Head of Research at Ashmore Investment Management, has said that while the summit may prove noisey, it is largely irrelevant to the fiscal health of its member states.
He said:
The broad trend is for more national spending to migrate to the EU as the European Union continues to integrate. Rising EU spending presents specific political challenges for countries such as the UK, whose government is undertaking austerity and does not support closer fiscal integration. However, the EU budget itself is not the cause of Europe's fiscal problems, which lie squarely with national governments, whose debts are still rising despite efforts to reform. These problems are the result of years of fiscal profligacy.
Europe's long-term path is towards fiscal union. The next step in this process is likely to be EU-wide banking regulation as a possible pre-cursor for a European version of TARP (forced recapitalization of Europe's banks). This will further increase Europe already excessive debt burden.
14.45 Some good news for Italy's prime minister Mario Monti. His government easily won a confidence vote in the lower house of parliament on its latest budget plan by 426 votes to 88.
This paves the way for a sales tax hike to help mend public finances.
The budget plan, called Stability Law, is central to Prime Minister Mario Monti's efforts to lower Italy's public deficit to 1.8pc of output next year from a targeted 2.6pc in 2012.
The Stability Law is expected to be one of the final pieces of important legislation approved under Monti before the country's government election next year.
14.34 Ahead of Cameron's arrival in Brussels for the EU Summit, the Telegraph's Brussels Correspondent Bruno Waterfield has this piece of analysis on what Britian can expect out of the two-day meeting.
It is a tradition as old as the 40 years that Britain has been in the EU. A Prime Minister heading to Brussels for difficult summit negotiations over the long-term financing of the EU draws a life-or-death red line in the sand.
David Cameron has vowed to veto a proposal by Herman Van Rompuy, the EU president, to cut Britain’s annual refund from Brussels by £6 billion.
Cloaking himself in the mantle of Margaret Thatcher, who won the original British rebate in 1984, Mr Cameron appears as resolute defender of the national interest.
Except the rebate red line is more of a straw man, a piece of political furniture concealing a classic piece of misdirection, a sleight of hand.
Mr Van Rompuy has proposed a rebate cut but, as it is protected by a built in British veto, it is a non-flyer to begin with. It’s a helpful piece of the summit stage set. Mr Cameron can declare it a red line and declare an inevitable victory.
Meanwhile, as the public focuses on the rebate, the political prestidigitators in Whitehall and Downing Street are pulling off a conjuring trick.
As the Daily Telegraph revealed on Wednesday morning, the substance of Mr Cameron’s summit strategy is to drop his demand made in 2010 (and restated last month) for a cut in Britain’s annual contributions as payments to Brussels coffers.
Instead, Britain will sign off on a reduction in the “payment appropriations ceiling” allowed for the period between 2014 and 2020, £755 billion is the figure doing the rounds. Washed down with some Treasury number soup and the fact that actual, real annual payments are usually less than the ceiling, the U-turn can be spun as a “real freeze” to spending.
As Mr Cameron rails against Mr Van Rompuy’s rebate cut, diplomats tell another story: that Britain is ready to do a deal that will see its contributions rise while the overall EU budget level frozen.
In other words, he will claim victory on a headline freeze for the EU budget while blaming any increase to what Britain actually has to pay on the previous Labour government.
The Prime Minister is the first EU leader in for talks with Mr Van Rompuy and Jose Manuel Barroso, the European Commission President, on Thursday morning. Diplomats do not predict any problems.
“Cameron is already thinking how to defend the deal, meaning that psychologically Britain is pretty much in the bag,” said a diplomat.
14.20 Sport in Greece has been hit hard a result of the financial crisis.
Today Hellenic Swimming Federation (KOE) president Dimitris Diathesopoulos announced that Greece will not compete in the European short-course swimming championships for the first time in 16 years due to financial problems.
Diathesopoulos told Reuters Greece would miss the championships starting in Chartres, France, on Thursday.
He said:
We had decided in the summer that we would not attend the European event this year, mainly due to financial reasons. We programmed this according to our budget constraints and the fact that the world championships are so close.
Of course we are disappointed that we will miss out for the first time since 1996 after so many successive appearances, but these days a lot of things are happening for the first time in Greece's history.
The announcement comes two weeks after the Greek government's decision to slash funding for sports federations which has forced the Hellenic Olympic Committee (HOC) to announce that a host of federations will stop operating from January 1 next year unless the state revises its plans for funding in the 2013 budget.
13.57 Over to Spain now. Its central bank governor Luis Maria Linde has said the economy shows no signs of recovery and the country risks missing budget deficit targets this year and in 2013 as a deep recession drags on.
In a speech to the Senate, Linde also said that European Central Bank monetary policy solutions would only buy time for the eurozone, which must also address underlying problems.
Linde told lawmakers on Wednesday that the Spanish economy was still not showing signs of strengthening, although he offered a more upbeat view later when talking to reporters.
He said:
The process of adjustment in the Spanish economy is at a delicate point, in which an improvement in activity and job creation is yet to be seen. The available information does not allow us to rule out the possibility of a deviation (from deficit reduction targets).
This is bad news for Spain and will do nothing to stop many who believe the country will need to ask for a bailout from Europe.
13.40 Back to Greece and Democratic Left leader and coalition partner Fotis Kouvelis has called on the country’s partners and creditors to “immediately live up to their commitments.”, eKathimerini.com reports. It writes:
Kouvelis’s remarks were made following a meeting between Greece’s partners and creditors on Tuesday which failed to reach conclusive decisions regarding the country’s debt sustainability and pledged bailout aid.
“Greece has taken all necessary measures,” noted Kouvelis, who added that everyone recognized the efforts made by Greek society and that it was now up to the eurozone and the International Monetary Fund to carry out their own pledges.
Kouvelis reiterated the need for a deal with regard to a transitional agreement between the IMF and the eurozone regarding measures that would reduce the Greek debt's additional charges.
He added that Greece’s European partners ought to continue the funding program and reducing the debt in order for Greece to get back on the growth track and render the debt’s management sustainable on a social level.
13.07 The German finance minister Wolfgang Schaeuble has been speaking more on Greece in the last few moments.
Reuters has the pointers of what he said:
• working intensively with the IMF, confident Greek financing gap can be filled.
• we agree with IMF that there will be a debt buyback programme
• German government favours increasing EFSF (bailout fund) programme for Greece
• believes Bundestag can decide on Greece at end of next week
• some other eurozone states favour lowering interest rates of first Greek aid programme
• none of Greek aid measures under consideration would affect German 2013 budget
• would be good sign if eurogroup decides on Greek aid next Monday
12.45 A quick look at lunch time markets, which have recovered from earlier losses.
The FTSE 100 and DAX are now flat, while the IBEX and CAC are up 0.1pc. 12.30 Finnish Prime Minister Jyrki Katainen has also been speaking ahead of the EU Summit to reporters in Helsinki.
Katainen said the 27-nation European Union must rein in its budget during the crisis.
Bloomberg has the pointers:
• “It can’t be so that the EU budget grows in these tough economic times".
• “Not realistic” to expect Finnish net contribution to fall, must try to limit how much it increases.
• Declined to comment on Greek aid talks
12.21 Italy, on the other hand, feels there is a "significant possibility" that a deal will be reached on the EU budget at the Summit this week.
At a press conference in Rome, Italy's European Affairs Minister Enzo Moavero said:
I think there is a significant possibility of an agreement at this Council meeting. Only 24 hours ago Moavero said Italy was ready to veto any deal that was not in the country's interests.
Italy has opposed moves led by Britain and other northern European countries for cuts to the EU's trillion euro budget.
12.07 David Cameron is travelling to Brussels later today ahead of the EU Summit tomorrow and has reiterated his stance that the cuts in spending in the EU budget do not go far enough.
A spokesman for the prime minister said:
While [Herman] Van Rompuy's proposals are a step in the right direction, we believe there are still areas where further cuts can be made. EU chief Van Rompuy last week tabled a draft EU budget aiming to mollify Britain, which wants deep reductions to EU spending plans.
Van Rompuy's draft would reduce the roughly €1trn budget for 2014-2020 proposed by the European Commission by about €80bn.
11.40 Sticking with Alexis Tsipras, eKathimerini.com is repoting that he is due to meet with the ambassadors representing all 27 European Union member states next Tuesday in a bid to boost ties between his party, which is leading in opinion polls, and European representatives in Athens.
The website writes:
According to sources, the initiative for the meetings was taken by the EU’s Cypriot presidency and is part of broader European efforts to develop ties with parties across the political spectrum. Tsipras, who on Thursday is to travel to Barcelona for talks with leftist politicians ahead of regional elections that could bring independence for Catalonia, has repeatedly claimed that the bailout funding being sought by Greece will not be used to prop up the debt-wracked economy.
On Tuesday, in an interview with the Al Jazeera television channel, he said Greece needed foreign aid but said that the installment due for release in coming weeks would go straight to local banks before these had been cleared of their bad loans, which he likened to “throwing water into a bottomless barrel.”
11.26 Back in Greece, Alexis Tsipras, head of the opposition party Syriza, has been blasting Greek PM Samaras for becoming a "tool" for Merkel.
Speaking in parliament Tsipras said Samaras had lost his "last ounce of respectability".
Deputy editor of Greece's daily English language newspaper Kathimerini, Nick Malkoutzis has been watching it unfold.
Twitter: Nick Malkoutzis - #Tsipras: Europe finds itself face to face with the dead-ends it has created through its policies
Twitter: Nick Malkoutzis - #Tsipras: Disbursement of the next loan will not secure the sustainability of Greek debt. The Eurogroup even considered a repayment freeze
Twitter: Nick Malkoutzis - #Tsipras: What is the Greek position on debt, on these key developments in Europe?
Twitter: Nick Malkoutzis - #Tsipras: Samaras refused to use the negotiating power he's given by the disagreement between lenders
Twitter: Nick Malkoutzis - #Tsipras: Samaras has lost the last ounce of respectability by claiming Greece will run out of money on November 16
Twitter: Nick Malkoutzis - #Tsipras: Samaras has become a pre-election tool for Merkel, who does not want to admit that she has made serious mistakes
11.16 Sticking with the EU budget, Portugal could veto it tomorrow as elements are "unacceptable" and it is not balanced.
Portugal's Prime Minister Pedro Passos Coelho told parliament the EU budget must not reduce funding for developing peripheral areas of Europe and has to ensure continued convergence of income levels across the region.
"This European budget proposal is not balanced and contains elements that are not acceptable," he said.
He added that he backed the initial European Commission's budget proposal and thought it was still possible to find a balanced solution.
11.10 Angela Merkel has been speaking ahead of the EU Summit tomorrow where leaders will discuss the EU budget.
Well she has said it's possible that EU leaders will need to meet again in early 2013 to clinch a solution on the budget.
Reuters has posted some points from the speech:
• Merkel says idea that we can solve Europe's problems for good is wrong. Must continue step-by-step approach.
• Merkel says Europe is in a serious situation. Crisis cannot be solved in a couple of years.
• Merkel says there are chances of solutions on Greece on Monday.
• Merkel says possible EU leaders will need to meet again in early 2013 to clinch solution on budget.
10.56 The Greek prime minister Antonis Samaras isangry about the eurogroup's failure to reach a deal and repeated delays in releasing the aid, pointing out that the debt-laden country has done what has been asked of it, now its lenders must do the same.
He said:
Greece did what it had committed it would do . Our partners, together with the IMF, also have to do what they have taken on to do. Any technical difficulties in finding a technical solution do not justify any negligence or delays.
10.45 However, Merkel's Social Democrat (SPD) election rival Peer Steinbrueck said Greece would not be able to return to capital markets this decade and that its financing gap could not be filled with piecemeal steps.
Talking in parliament in a debate on the German budget he said
It is obvious that Greece will not in this decade be able to return to the capital markets under viable conditions. He added that Merkel's government should delay a vote on the German budget until it was clear what was happening with Greece.
10.35 Back to Greece now.
German Chancellor Angela Merkel has told lawmakers at a closed-door meeting that lower interest rates and an expanded European Financial Stability Fund (EFSF) could fill Greece's financing gap, a source at the session told Reuters.
Merkel told the meeting that EFSF guarantees could be raised by €10bn and that Germany would take its share in that, said the participant in the meeting.
Different euro zone states could help Greece in different ways, she said, according to the source.
Merkel addressed the lawmakers after European finance ministers, the European Central Bank and International Monetary Fund (IMF) failed to reach a deal to free up new aid for Greece.
10.14 Some reaction to those worse-than-expected borrowing numbers (see 10.08) and the Bank of England minutes (see 09.45).
Victoria Clarke, Investec
Public finances data is pretty disappointing, coming with a significant overshoot of expectations. This will be concerning for the Chancellor and give him a bit more work to do for the Autumn statement in terms of bringing the UK finances back on track. The BoE vote isn't hugely surprising. The MPC have been briefed on the government's intention to normalize the cash management arrangements for the asset purchase facility, and that was effectively an easing of monetary policy.
Given that that was an easing, I would say that 8/9 is not indicative of the committee's inclination to ease policy at a future date.
Vicky Redwood, Capital Economics
October's UK public finance figures - the last before the Autumn Statement in a fortnight's time - show that government borrowing is still running significantly above last year's levels. If the OBR assumes that this trend continues, it will have to revise up its forecast for this year from 120 to 130 billion pounds. Even if the OBR assumes that the trend improves a bit, it will still be pretty touch and go whether the Chancellor will be expected to meet his fiscal rules without increasing his austerity measures further. The minutes of this month's MPC meeting show that the vote to leave QE unchanged was 8-1, as we expected, with only David Miles wanting an increase of 25 bilion pounds. However, like the Inflation Report, the minutes leave the door open for more QE.
Even after taking account of the extra monetary loosening from the transfer of the APF cash to the Treasury, a case could be made for a further easing in monetary conditions. We still expect more QE in February.
Howard Archer, IHS Global
The minutes of the November MPC meeting keep open the possibility that the committee will push the Quantitative Easing button again should the economy fail to pick up and if underlying inflationary pressures appear to be broadly contained. With economic recovery currently looking feeble, fragile and far from guaranteed, we continue to lean towards the view that the Bank of England will ultimately decide to give the economy a further helping hand with a final £50 billion of QE. While this is unlikely to happen in December, it could well occur in the first quarter of 2013 if data and surveys over the coming weeks point to the economy flirting with renewed contraction.
10.08 The UK's borrowing figures were also out this morning, which show that public borrowing was worse than expected.
The Office for National Statistics said the government's preferred measure, public sector net borrowing excluding financial sector interventions, came in at £8.6bn in October, up from £5.9bn in October 2011.
This was well above economists' average forecast of £6bn, and higher even than the most pessimistic estimate in a Reuters poll of 19 analysts.
A near 10pc fall in corporation tax receipts, in a month when there is usually a heavy inflow, as well as a rise in day-to-day departmental spending, accounted for much of the year-on-year increase.
The figures also showed that the Britain's government borrowed much more than expected in October, reducing the chance that the government will meet its 2012/13 deficit reduction goal.
The data are the last figures before George Osborne presents his pre-budget statement on December 5 and - after a positive surprise in September - extend the borrowing overshoots seen for most of the tax year.
09.45 In the UK the Bank of England has released the minutes from the rate-setting Monetary Policy Committee in November.
The minutes show that one (David Miles) of the nine members nine voted to increase the quantitative easing programme by £25bn to bring it to a total of £400bn. The remaining 8 all voted to hold it at £375bn.
The minutes stated that members views differed over the exact impact of the MPC's asset purchases, however they did agree that demand and output would have been "significantly weaker in their absence".
The committe said there "remained considerable further scope" for asset purchases to lower long-term yields on government and corporate debt and support other asset prices, but said there was a question over the magnitude of the impact of lower yields and higher asset prices on the broader economy at the current juncture.
The Committee also discussed the effectiveness of reducing the bank rate from its record low of 0.5pc, where it has been since March 2009, and concluded that a reduction was unlikely in the foreseeable future. Therefore the vote to maintain the current bank rate was unanimous.
The minutes stated:
Analysis had concluded that a further cut in Bank Rate would be likely to cause a reduction in the profitability of some lenders, especially building societies, because of the prevalence of loans with interest terms contractually or closely linked to Bank Rate. That would weaken their balance sheets and they might have to respond by increasing other loan rates or restricting lending. Viewed against the backdrop of the Funding for Lending Scheme (FLS), and the potential for building societies to play a material role in increasing lending, the Committee judged that it was unlikely to wish to reduce Bank Rate in the foreseeable future.
09.28 President of the European Council Herman Van Rompuy's office have been speaking ahead of the Summit tomorrow. The Telegraph's Brussels correspondent Bruno Waterfield has been tweeting about it.
greement could not be reached at today's meeting , another meeting is scheduled for Monday.==========
------------------------------------------------------
"As Mr Cameron rails against Mr Van Rompuy’s rebate cut, diplomats tell another story: that Britain is ready to do a deal that will see its contributions rise while the overall EU budget level frozen.
In other words, he will claim victory on a headline freeze for the EU budget while blaming any increase to what Britain actually has to pay on the previous Labour government."
Cameron really is a devious b***er, the sooner he is ousted the better.
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Re: New EC Thread
Panda Thu 22 Nov - 7:21
By Robert Nisbet, Europe Correspondent
David Cameron travels to Brussels later insisting that austerity being enforced around Europe is reflected in the EU's budget.
He will join leaders from all 27 countries at a special summit to set the European Union's spending limits from 2014 to 2020.
It is a complex and deeply divisive process, with the UK balking at the European Commission's opening gambit - to increase the overall spending ceiling to a maximum €1,091,000,000,000.
This was flatly rejected by Britain and nearly all the net contributors to the European Union.
The European Council, which represents the interest of the member states, chimed in with its own plan, which represents a real-terms 2% cut from the spending ceiling approved for the current seven-year period.
But the proposal, penned by the Council President Herman van Rompuy, would reduce Britain's rebate and only contains a 1% reduction under so-called "Heading 4", which details the EU's spending on administration costs.
Mr Cameron, and other leaders, believe Brussels should accept some symbolic reductions in red tape and make deeper cuts to the legions of Eurocrats who work in the EU institutions.
The British Prime Minister believes Mr van Rompuy's proposals are moving in the right direction, but he needs to go further.
He has also insisted that the UK's £3bn a year rebate, which was negotiated to compensate Britain for money disbursed to other nations, is not up for discussion.
He told MPs yesterday he would be "fighting incredibly hard" to get the best deal for the UK, but he could use the veto to protect British interests.
The budget has to be agreed by all 27 members and by a majority in the European Parliament.
Other countries also have reservations with the proposals on the table: France and Ireland want to protect agricultural payments to their farmers, Italy is unhappy that other countries' rebates due to expire in 2013 might be renewed while Denmark wants to negotiate its own rebate.
Earlier this month Mr Cameron was blindsided by a Tory rebellion calling for a budget cut, not just a freeze. He may yet face their wrath.
The budget being discussed is about setting an absolute limit on EU spending, but the money spent is always considerably less.
So while the British Prime Minister might be able to claim a victory in securing a freeze in total EU spending limits, UK taxpayers may still have to fork out more cash to Brussels.
If no agreement is reached, more summits will be held in the new year.
If there are still problems, the annual budget will roll over with an extra 2% added to take account of inflation
David Cameron travels to Brussels later insisting that austerity being enforced around Europe is reflected in the EU's budget.
He will join leaders from all 27 countries at a special summit to set the European Union's spending limits from 2014 to 2020.
It is a complex and deeply divisive process, with the UK balking at the European Commission's opening gambit - to increase the overall spending ceiling to a maximum €1,091,000,000,000.
This was flatly rejected by Britain and nearly all the net contributors to the European Union.
The European Council, which represents the interest of the member states, chimed in with its own plan, which represents a real-terms 2% cut from the spending ceiling approved for the current seven-year period.
But the proposal, penned by the Council President Herman van Rompuy, would reduce Britain's rebate and only contains a 1% reduction under so-called "Heading 4", which details the EU's spending on administration costs.
Mr Cameron, and other leaders, believe Brussels should accept some symbolic reductions in red tape and make deeper cuts to the legions of Eurocrats who work in the EU institutions.
The British Prime Minister believes Mr van Rompuy's proposals are moving in the right direction, but he needs to go further.
He has also insisted that the UK's £3bn a year rebate, which was negotiated to compensate Britain for money disbursed to other nations, is not up for discussion.
He told MPs yesterday he would be "fighting incredibly hard" to get the best deal for the UK, but he could use the veto to protect British interests.
The budget has to be agreed by all 27 members and by a majority in the European Parliament.
Other countries also have reservations with the proposals on the table: France and Ireland want to protect agricultural payments to their farmers, Italy is unhappy that other countries' rebates due to expire in 2013 might be renewed while Denmark wants to negotiate its own rebate.
Earlier this month Mr Cameron was blindsided by a Tory rebellion calling for a budget cut, not just a freeze. He may yet face their wrath.
The budget being discussed is about setting an absolute limit on EU spending, but the money spent is always considerably less.
So while the British Prime Minister might be able to claim a victory in securing a freeze in total EU spending limits, UK taxpayers may still have to fork out more cash to Brussels.
If no agreement is reached, more summits will be held in the new year.
If there are still problems, the annual budget will roll over with an extra 2% added to take account of inflation
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Re: New EC Thread
Panda Thu 22 Nov - 10:29
EU summit: David Cameron vows to stop 'unacceptable' EU budget increase
David Cameron said he would be “negotiating hard” against an "unacceptable” EU spending increase and defending the British rebate at today's summit.
David Cameron, the Prime Minister, has to tread a difficult path at the EU budget talks in Brussels Photo: AFP
By Rowena Mason, Political Correspondent, and Bruno Waterfield in Brussels
9:21AM GMT 22 Nov 2012
David Cameron will today fight for a "tough but realistic" deal on EU budget, amid reports that Brussels may be prepared to cut spending by more than expected.
He will meet this morning with Herman Van Rompuy, the EU president, who is proposing a deal that would cut the overall budget, but reduce the value of Britain’s annual rebate.
Speaking this morning Mr Cameron said he would be “negotiating hard” against an "unacceptable” EU spending increase and defending the British rebate.
The PM said it was “quite wrong” for the European Commission to propose increased Brussels budgets at a time of national austerity.
"These are very important negotiations. Clearly at a time when we are making difficult decisions at home over public spending it would be quite wrong - it is quite wrong - for there to be proposals for this increased extra spending in the EU.
Related Articles
"So we are going to be negotiating very hard for a good deal for Britain's taxpayers, for Europe's taxpayers, and to keep the British rebate."
Prime Minister David Cameron speaks with journalists as he arrives for the EU summit at the EU Council building in Brussels (AP)
The Prime Minister has promised to fight "incredibly hard" to protect the rebate worth £3 billion a year to the UK, which was negotiated by Margaret Thatcher to compensate for France's large farming subsidies.
He is under intense pressure to get a good settlement or veto the whole deal, as dozens of his own Conservative MPs believe the EU should be spending less.
Bernard Jenkin, a senior backbench Tory, today said the EU budget is the "one of the biggest scandals of public life" as it is open to fraud and bad management.
He told BBC Radio 4's Today Programme that Britain should not be giving any extra cash when the EU's accounts have not been signed off "for 17 years on the trot".
Mr Jenkin also claimed many other countries are threatening to veto the talks and the Prime Minister should not be afraid to walk away.
Mr Cameron has said he ideally wants to see the EU budget cut but will push for the more realistic position of a freeze in the budget in line with inflation.
He will have to fight proposals from the EU for an increase in spending of up to five per cent at the same time as protecting Britain's rebate.
British officials have said that Mr van Rompuy's compromise deal to cut the rebate could mean that UK taxpayers end up contributing up to £6 billion more to the EU, even if its overall budget falls.
Nick Clegg, the deputy Prime Minister, said Mr Cameron's position will be "tough but realistic" and most of the public will think it is "perfectly reasonable" for the EU to tighten its belt.
The EU leaders are trying to agree a seven-year budget starting in 2014 but the negotiations could drag on into next year if no deal can be agreed.
Last night Grant Shapps, the Tory Party chairman said increases in Britain's contributions to the European Union would be "unacceptable", a Cabinet minister has said.
Mr Shapps said Mr Cameron intended to "freeze, if not cut" Britain's payments to the EU.
In a BBC interview, he suggested the Prime Minister will pursue a deal that reverses Mr Blair's changes and enlarges the rebate. Downing Street declined to repeat Mr Shapps's promise of a reduction in EU payments.
The rebate, worth £3.2billion a year, reflects the fact that Britain receives much less in farm subsidies than France.
David Cameron said he would be “negotiating hard” against an "unacceptable” EU spending increase and defending the British rebate at today's summit.
David Cameron, the Prime Minister, has to tread a difficult path at the EU budget talks in Brussels Photo: AFP
By Rowena Mason, Political Correspondent, and Bruno Waterfield in Brussels
9:21AM GMT 22 Nov 2012
David Cameron will today fight for a "tough but realistic" deal on EU budget, amid reports that Brussels may be prepared to cut spending by more than expected.
He will meet this morning with Herman Van Rompuy, the EU president, who is proposing a deal that would cut the overall budget, but reduce the value of Britain’s annual rebate.
Speaking this morning Mr Cameron said he would be “negotiating hard” against an "unacceptable” EU spending increase and defending the British rebate.
The PM said it was “quite wrong” for the European Commission to propose increased Brussels budgets at a time of national austerity.
"These are very important negotiations. Clearly at a time when we are making difficult decisions at home over public spending it would be quite wrong - it is quite wrong - for there to be proposals for this increased extra spending in the EU.
Related Articles
EU summit: Q&A
22 Nov 2012
EU Budget Summit: Cameron to fight for rebate - debt crisis live
22 Nov 2012
"So we are going to be negotiating very hard for a good deal for Britain's taxpayers, for Europe's taxpayers, and to keep the British rebate."
Prime Minister David Cameron speaks with journalists as he arrives for the EU summit at the EU Council building in Brussels (AP) The Prime Minister has promised to fight "incredibly hard" to protect the rebate worth £3 billion a year to the UK, which was negotiated by Margaret Thatcher to compensate for France's large farming subsidies.
He is under intense pressure to get a good settlement or veto the whole deal, as dozens of his own Conservative MPs believe the EU should be spending less.
Bernard Jenkin, a senior backbench Tory, today said the EU budget is the "one of the biggest scandals of public life" as it is open to fraud and bad management.
He told BBC Radio 4's Today Programme that Britain should not be giving any extra cash when the EU's accounts have not been signed off "for 17 years on the trot".
Mr Jenkin also claimed many other countries are threatening to veto the talks and the Prime Minister should not be afraid to walk away.
Mr Cameron has said he ideally wants to see the EU budget cut but will push for the more realistic position of a freeze in the budget in line with inflation.
He will have to fight proposals from the EU for an increase in spending of up to five per cent at the same time as protecting Britain's rebate.
British officials have said that Mr van Rompuy's compromise deal to cut the rebate could mean that UK taxpayers end up contributing up to £6 billion more to the EU, even if its overall budget falls.
Nick Clegg, the deputy Prime Minister, said Mr Cameron's position will be "tough but realistic" and most of the public will think it is "perfectly reasonable" for the EU to tighten its belt.
The EU leaders are trying to agree a seven-year budget starting in 2014 but the negotiations could drag on into next year if no deal can be agreed.
Last night Grant Shapps, the Tory Party chairman said increases in Britain's contributions to the European Union would be "unacceptable", a Cabinet minister has said.
Mr Shapps said Mr Cameron intended to "freeze, if not cut" Britain's payments to the EU.
In a BBC interview, he suggested the Prime Minister will pursue a deal that reverses Mr Blair's changes and enlarges the rebate. Downing Street declined to repeat Mr Shapps's promise of a reduction in EU payments.
The rebate, worth £3.2billion a year, reflects the fact that Britain receives much less in farm subsidies than France.
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Re: New EC Thread
Panda Thu 22 Nov - 13:38
EU budget
Maximum spending, minimum gain
22 November 2012Der Standard Vienna
European astronomy. "Giants and dwarves!
Oliver
The EU spends a third of its budget to try to narrow the gap between rich and poor in Europe. Despite the billions from Brussels, though, the poorer countries have not caught up. Could the 27 please rethink that when they discuss the EU budget?
Eric Frey
However the negotiations on the EU budget turn out, it is quite likely that, as with other budget items, the EU Cohesion Fund will be scaled back over the next few years. At the same time we can assume that the funds, a pillar of EU policy for decades, will by and large survive. Neither the sum nor the strategies of the programme, administered by the Austrian Johannes Hahn, will change much.
This could be the chance, though, to discuss the overall cohesion policy, which eats up about a third of the EU budget. The purpose of the so-called structural funds is to reduce the disparities between rich and poor in the Union, so boosting productivity and spurring economic growth in the less developed regions. For decades the main beneficiaries have been the southern Europeans – that Austria’s Burgenland also got nearly a billion euros was more of a sweetener than a necessity. Since the enlargement to the east, the ex-communist countries are also hoping for the windfall from Brussels.
As pleasant as it is for individual states to have vital infrastructure projects co-financed from the outside, the economic balance works out rather miserably: despite all the aid, the gap between northern and southern Europe has not shrunk. The poorer countries have indeed grown stronger in a few short years, but when it comes to productivity and competitiveness they are still lagging behind.
The short-term economic boom was paid for mainly by debt, and now in the crisis the gap is again widening sharply. The European debt crisis also signals the failure of the entire European policy of convergence, to which the Cohesion Fund belongs.
A monetary union needs generous transfers
One can clearly see from just this tool alone that money does not always pave the way to prosperity. Most of the funding flows down the traditional routes. While better roads and railways do increase the productivity of an economy, other factors, like education, entrepreneurship, and legal certainty, are much more significant.
The EU funds have indeed created jobs and strengthened purchasing power in the recipient countries, but they have failed to correct those countries’ structural flaws. In fact, they did the opposite: by helping to conceal the flaws, they contributed to delaying the reforms that are needed.
These programmes proved to be particularly useless in the eurozone crisis. A monetary union needs generous transfers to correct imbalances. However, since the deployment of the structural funds is scheduled years in advance, the recipient countries have to set aside a great deal of capital of their own for the so-called co-financing, which makes that money unavailable just when it is really needed – around now, for example, to tackle youth unemployment in Spain or Portugal.
A meaningful reform would see the EU stop financing more roads and bridges and start instead to create a genuine crisis fund that responds flexibly to the needs of Member States and that could now balance out the rigours of austerity. For the Eastern Europeans, though, that would be unacceptable, even if they benefit from the Cohesion Funds less than was thought. In a EU that measures political success only by how much a country pays in and cashes out, such a paradigm shift is unfortunately unimaginable.
Translated from the German by Anton Baer
On the web
Structural funds
Funds benefit all EU
Why demand more money from the EU if the funds are not spent correctly? The answer lies in motorways, explains Romanian newssite Gândul, comparing the state of the Romanian motorway network – and its financing – with that of Poland. In Romania, there are only 516 kilometres of motorway, half of which were opened to traffic after the country joined the EU in 2007. In comparison, Poland, a champion in matters of absorption of EU funds, has built approximately 1,300 kilometres of motorway financed by 6 billion euros in European funds. That leads Polish daily Dziennik Gazeta Prawna to note that –
Maximum spending, minimum gain
22 November 2012Der Standard Vienna
European astronomy. "Giants and dwarves!
Oliver
The EU spends a third of its budget to try to narrow the gap between rich and poor in Europe. Despite the billions from Brussels, though, the poorer countries have not caught up. Could the 27 please rethink that when they discuss the EU budget?
Eric Frey
However the negotiations on the EU budget turn out, it is quite likely that, as with other budget items, the EU Cohesion Fund will be scaled back over the next few years. At the same time we can assume that the funds, a pillar of EU policy for decades, will by and large survive. Neither the sum nor the strategies of the programme, administered by the Austrian Johannes Hahn, will change much.
This could be the chance, though, to discuss the overall cohesion policy, which eats up about a third of the EU budget. The purpose of the so-called structural funds is to reduce the disparities between rich and poor in the Union, so boosting productivity and spurring economic growth in the less developed regions. For decades the main beneficiaries have been the southern Europeans – that Austria’s Burgenland also got nearly a billion euros was more of a sweetener than a necessity. Since the enlargement to the east, the ex-communist countries are also hoping for the windfall from Brussels.
As pleasant as it is for individual states to have vital infrastructure projects co-financed from the outside, the economic balance works out rather miserably: despite all the aid, the gap between northern and southern Europe has not shrunk. The poorer countries have indeed grown stronger in a few short years, but when it comes to productivity and competitiveness they are still lagging behind.
The short-term economic boom was paid for mainly by debt, and now in the crisis the gap is again widening sharply. The European debt crisis also signals the failure of the entire European policy of convergence, to which the Cohesion Fund belongs.
A monetary union needs generous transfers
One can clearly see from just this tool alone that money does not always pave the way to prosperity. Most of the funding flows down the traditional routes. While better roads and railways do increase the productivity of an economy, other factors, like education, entrepreneurship, and legal certainty, are much more significant.
The EU funds have indeed created jobs and strengthened purchasing power in the recipient countries, but they have failed to correct those countries’ structural flaws. In fact, they did the opposite: by helping to conceal the flaws, they contributed to delaying the reforms that are needed.
These programmes proved to be particularly useless in the eurozone crisis. A monetary union needs generous transfers to correct imbalances. However, since the deployment of the structural funds is scheduled years in advance, the recipient countries have to set aside a great deal of capital of their own for the so-called co-financing, which makes that money unavailable just when it is really needed – around now, for example, to tackle youth unemployment in Spain or Portugal.
A meaningful reform would see the EU stop financing more roads and bridges and start instead to create a genuine crisis fund that responds flexibly to the needs of Member States and that could now balance out the rigours of austerity. For the Eastern Europeans, though, that would be unacceptable, even if they benefit from the Cohesion Funds less than was thought. In a EU that measures political success only by how much a country pays in and cashes out, such a paradigm shift is unfortunately unimaginable.
Translated from the German by Anton Baer
On the web
Structural funds
Funds benefit all EU
Why demand more money from the EU if the funds are not spent correctly? The answer lies in motorways, explains Romanian newssite Gândul, comparing the state of the Romanian motorway network – and its financing – with that of Poland. In Romania, there are only 516 kilometres of motorway, half of which were opened to traffic after the country joined the EU in 2007. In comparison, Poland, a champion in matters of absorption of EU funds, has built approximately 1,300 kilometres of motorway financed by 6 billion euros in European funds. That leads Polish daily Dziennik Gazeta Prawna to note that –
Related
When decent infrastructure is finally built in our country, that will open opportunities for making money not only for Polish, but also for EU companies. So money invested in the cohesion policy is a good investment for the entire Union, not only for us. This is not simply aid to the poor, something that societies of the old Union are more and more reluctant to give.
- A budget for 7 years
Presseurop
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Re: New EC Thread
Panda Thu 22 Nov - 17:33
EU Budget: 'Long Way To Go' Before Deal
Downing Street says an agreement among EU leaders is far off as David Cameron vows to fight any budget hike at a Brussels summit.
12:59pm UK, Thursday 22 November 2012
Video: Mr Cameron has threatened to use Britain's veto over EU budget plans
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European Commission
Graph: Top Five Contributors To EU Budget
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There is "a long way to go" before EU leaders at a special summit in Brussels can agree a long-term budget, Downing Street has said following a meeting between David Cameron and European Council president Herman Van Rompuy.
Mr Cameron was the first of the EU's 27 national leaders to meet summit chairman Mr Van Rompuy and European Commission president Jose Manuel Barroso ahead of what are expected to be marathon negotiations beginning this evening in the Belgian capital.
Arriving in Brussels this morning, the Prime Minister insisted that any rise in European Union spending was "quite wrong" and said he would be fighting "very hard" to secure a good deal for British taxpayers and to keep the rebate negotiated by Margaret Thatcher in the 1980s.
"These are very important negotiations. Clearly at a time when we are making difficult decisions at home over public spending it would be quite wrong - it is quite wrong - for there to be proposals for this increased extra spending in the EU," he said.
Cameron meets Barroso and van Rompuy prior to the summit
Mr Cameron is calling for a real-terms freeze, or even a cut, in the budget for 2014-20 - the sole subject on the agenda for the summit, which starts tonight and could run into the weekend.
He has welcomed proposals from Mr Van Rompuy which would deliver a small real-terms cut in EU spending commitments, but has made clear he is unhappy with other details of the package, which demands a reduction in the £2.9bn UK rebate.
After his half-hour meeting with Mr Van Rompuy, a Downing Street spokesman said: "The Prime Minister set out our position that while the latest proposals were a step in the right direction, they did not go far enough and that we think more can be done to rein in spending.
"He also set out the UK's position on the rebate - that it was fully justified and we did not support any changes.
"It was clear that there was a long way to go before we had a deal that reflected the difficult decisions being taken by member states."
Other EU leaders will be ushered in to see the two presidents throughout the day as part of an unusual pre-summit effort to avoid deadlock when the summit gets under way tonight.
A pre-summit compromise is already on offer - a seven-year budget "envelope" of 973bn euro (£785bn) for 2014/2020, a cut of nearly 5bn euro (£3.8bn) compared with the 2007/2013 ceiling.
The move was seen in Downing Street as being in the right direction - although the "cut" is in a spending ceiling which officials say has not been reached.
It is also above the 886bn euro (£712bn) originally pitched by the Treasury as in line with the real-terms freeze Mr Cameron wants.
But in the complex world of EU budget economics, with financial "commitments" different from "payments", a range of calculation options, rebates for some countries, and contributor and beneficiary member states, Mr Cameron and his colleagues have plenty of scope for claiming summit success.
The Prime Minister's allies for budget belt-tightening, including Sweden and the Netherlands, have demanded hefty financial cuts.
Germany, France, Finland and Austria want to freeze the maximum Brussels can draw from member states every year - leaving plenty of scope to argue over the actual spending figures within the ceiling.
And 15 countries, led by Poland, are backing budget increases, not least to preserve the scale of cash aid they receive as "net beneficiaries" from the EU kitty.
Britain is arguing for a shake-up in EU spending priorities, cuts in agriculture spending and subsidies - fiercely defended by France - and cuts in EU staff levels and pay and perks, in line with national civil servants.
But the European Commission still insists that a spending increase is necessary, not least to pay for polices already agreed by member states.
Downing Street says an agreement among EU leaders is far off as David Cameron vows to fight any budget hike at a Brussels summit.
12:59pm UK, Thursday 22 November 2012
Video: Mr Cameron has threatened to use Britain's veto over EU budget plans
Enlarge
Net contribution to the EU budget in euros, 2011
GermanyFranceUKItalyHolland
GermanyFranceUKItalyHolland
0bn
2bn
4bn
6bn
8bn
7.54bn4.89bn4.7bn4.57bn1.87bn
FusionCharts
European Commission
Graph: Top Five Contributors To EU Budget
Enlarge
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There is "a long way to go" before EU leaders at a special summit in Brussels can agree a long-term budget, Downing Street has said following a meeting between David Cameron and European Council president Herman Van Rompuy.
Mr Cameron was the first of the EU's 27 national leaders to meet summit chairman Mr Van Rompuy and European Commission president Jose Manuel Barroso ahead of what are expected to be marathon negotiations beginning this evening in the Belgian capital.
Arriving in Brussels this morning, the Prime Minister insisted that any rise in European Union spending was "quite wrong" and said he would be fighting "very hard" to secure a good deal for British taxpayers and to keep the rebate negotiated by Margaret Thatcher in the 1980s.
"These are very important negotiations. Clearly at a time when we are making difficult decisions at home over public spending it would be quite wrong - it is quite wrong - for there to be proposals for this increased extra spending in the EU," he said.
Cameron meets Barroso and van Rompuy prior to the summit Mr Cameron is calling for a real-terms freeze, or even a cut, in the budget for 2014-20 - the sole subject on the agenda for the summit, which starts tonight and could run into the weekend.
He has welcomed proposals from Mr Van Rompuy which would deliver a small real-terms cut in EU spending commitments, but has made clear he is unhappy with other details of the package, which demands a reduction in the £2.9bn UK rebate.
After his half-hour meeting with Mr Van Rompuy, a Downing Street spokesman said: "The Prime Minister set out our position that while the latest proposals were a step in the right direction, they did not go far enough and that we think more can be done to rein in spending.
"He also set out the UK's position on the rebate - that it was fully justified and we did not support any changes.
"It was clear that there was a long way to go before we had a deal that reflected the difficult decisions being taken by member states."
Other EU leaders will be ushered in to see the two presidents throughout the day as part of an unusual pre-summit effort to avoid deadlock when the summit gets under way tonight.
A pre-summit compromise is already on offer - a seven-year budget "envelope" of 973bn euro (£785bn) for 2014/2020, a cut of nearly 5bn euro (£3.8bn) compared with the 2007/2013 ceiling.
The move was seen in Downing Street as being in the right direction - although the "cut" is in a spending ceiling which officials say has not been reached.
It is also above the 886bn euro (£712bn) originally pitched by the Treasury as in line with the real-terms freeze Mr Cameron wants.
But in the complex world of EU budget economics, with financial "commitments" different from "payments", a range of calculation options, rebates for some countries, and contributor and beneficiary member states, Mr Cameron and his colleagues have plenty of scope for claiming summit success.
The Prime Minister's allies for budget belt-tightening, including Sweden and the Netherlands, have demanded hefty financial cuts.
Germany, France, Finland and Austria want to freeze the maximum Brussels can draw from member states every year - leaving plenty of scope to argue over the actual spending figures within the ceiling.
And 15 countries, led by Poland, are backing budget increases, not least to preserve the scale of cash aid they receive as "net beneficiaries" from the EU kitty.
Britain is arguing for a shake-up in EU spending priorities, cuts in agriculture spending and subsidies - fiercely defended by France - and cuts in EU staff levels and pay and perks, in line with national civil servants.
But the European Commission still insists that a spending increase is necessary, not least to pay for polices already agreed by member states.
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Re: New EC Thread
Panda Thu 22 Nov - 21:07
Spain Sells 7.15 Billion Euros Debt, Half to State-Run Fund
By Emma Ross-Thomas and Emma Charlton - Nov 22, 2012 3:42 PM GMT
Spain sold 7.15 billion euros ($9.21 billion) of bonds, half to its pension reserve fund in a private sale, as it shores up financing amid efforts to avoid a European bailout.
The country sold 3.88 billion euros of debt at an auction, exceeding the maximum target of 3.5 billion euros. In a separate transaction it also sold 3.27 billion euros of notes maturing in Sept. 2017 to the welfare reserve fund at a yield of 4.792 percent, according to the official gazette and a spokesman at the Economy Ministry.
Enlarge image
Spain Sells EU3.88 Billion of Bonds, Beating Goal as Costs Fall
Jock Fistick/Bloomberg
Spain is building a cushion as Prime Minister Mariano Rajoy keeps investors guessing as to whether he will seek a bailout that would allow the European Central Bank to start buying Spanish bonds.
The Treasury has already sold all the bonds it had planned to issue this year, and is pressing ahead with auctions to finance its needs for 2013. The private placement with the state’s 67 billion-euro pension reserve fund, which has traditionally bought debt at auctions, comes after the government also chose a private sale to raise money for its regional bailout fund earlier this year.
“The private placement money may be used for the regional lending fund or to go toward the overshooting of the central government deficit this year,” Gianluca Ziglio, a strategist at UBS AG in London said in a telephone interview. “Spain has a lot of financing that still has to be accounted for, which the market would probably struggle to take down, so they are trying to find other ways to cover it.”
Holdings Doubled
The Economy Ministry spokesman said the fund was reinvesting following a redemption. The fund can only invest 500 million euros per issue at each bond auction, making a private placement more convenient, he said. A spokeswoman for the Labor Ministry, which runs the social-security fund, said it was investing excess liquidity, without giving details, and declined to say why it didn’t buy the debt at auctions.
The reserve has almost doubled its holdings of Spanish debt since 2008 as declining demand for the nation’s bonds prompted it to start replacing German, French and Dutch debt with Spanish equivalents.
The Treasury set out to sell 86.4 billion euros of medium-and long-term debt this year and after today’s sale had sold 105 percent of that amount, it said in a statement. When the government agreed in July to bail out the regions with as much as 18 billion euros, it said it would keep its auction calendar unchanged and raise the funds via a private placement among Spanish banks and a 6 billion-euro loan via the state lottery, which has still to be completed.
Even as the government says it will meet its budget-deficit goal of 6.3 percent of gross domestic product this year, economists expect a 7.1 percent shortfall, according to data compiled by Bloomberg, increasing potential borrowing needs.
Bailout Deliberations
Prime Minister Mariano Rajoy continues to deliberate over whether to seek a European bailout that would allow the European Central Bank to buy Spanish bonds. He has said since Aug. 3 he would consider seeking a rescue, which would be the second after his government agreed to a 100 billion-euro credit line for the nation’s banks in June.
At the auction today, the Treasury sold notes maturing in 2015 at 3.617 percent, compared with 3.660 on Nov. 8. The current five-year benchmark was sold to yield 4.477 percent, compared with 4.525 percent on the secondary market before the sale and 4.766 percent at an auction in October. Bonds maturing in 2021 yielded 5.517 percent.
Demand was 2.09 times the amount sold for the 2015 bonds, down from 2.83 times on Nov. 8. It was 2.61 for the five-year notes, from 2.47 times on Oct. 4, and 1.77 for the 2021 bonds.
“Today’s Spanish sale was comfortable,” Raj Badiani, an economist at IHS Global Insight said in a note. “We continue to argue that the calmer Spanish sovereign financing environment is a temporary respite, given the profound economic and fiscal strains.”
The 10-year benchmark bond yield declined to 5.615 percent at 4:40 p.m. in Madrid from 5.709 percent yesterday. Spain’s borrowing cost have fallen from a euro-era record of 7.75 percent on July 25, before ECB President Mario Draghi first signaled the bank’s willingness to intervene in markets when he pledged to do whatever it takes to defend the euro.
By Emma Ross-Thomas and Emma Charlton - Nov 22, 2012 3:42 PM GMT
Spain sold 7.15 billion euros ($9.21 billion) of bonds, half to its pension reserve fund in a private sale, as it shores up financing amid efforts to avoid a European bailout.
The country sold 3.88 billion euros of debt at an auction, exceeding the maximum target of 3.5 billion euros. In a separate transaction it also sold 3.27 billion euros of notes maturing in Sept. 2017 to the welfare reserve fund at a yield of 4.792 percent, according to the official gazette and a spokesman at the Economy Ministry.
Enlarge image
Spain Sells EU3.88 Billion of Bonds, Beating Goal as Costs Fall
Jock Fistick/Bloomberg
Spain is building a cushion as Prime Minister Mariano Rajoy keeps investors guessing as to whether he will seek a bailout that would allow the European Central Bank to start buying Spanish bonds.
The Treasury has already sold all the bonds it had planned to issue this year, and is pressing ahead with auctions to finance its needs for 2013. The private placement with the state’s 67 billion-euro pension reserve fund, which has traditionally bought debt at auctions, comes after the government also chose a private sale to raise money for its regional bailout fund earlier this year.
“The private placement money may be used for the regional lending fund or to go toward the overshooting of the central government deficit this year,” Gianluca Ziglio, a strategist at UBS AG in London said in a telephone interview. “Spain has a lot of financing that still has to be accounted for, which the market would probably struggle to take down, so they are trying to find other ways to cover it.”
Holdings Doubled
The Economy Ministry spokesman said the fund was reinvesting following a redemption. The fund can only invest 500 million euros per issue at each bond auction, making a private placement more convenient, he said. A spokeswoman for the Labor Ministry, which runs the social-security fund, said it was investing excess liquidity, without giving details, and declined to say why it didn’t buy the debt at auctions.
The reserve has almost doubled its holdings of Spanish debt since 2008 as declining demand for the nation’s bonds prompted it to start replacing German, French and Dutch debt with Spanish equivalents.
The Treasury set out to sell 86.4 billion euros of medium-and long-term debt this year and after today’s sale had sold 105 percent of that amount, it said in a statement. When the government agreed in July to bail out the regions with as much as 18 billion euros, it said it would keep its auction calendar unchanged and raise the funds via a private placement among Spanish banks and a 6 billion-euro loan via the state lottery, which has still to be completed.
Even as the government says it will meet its budget-deficit goal of 6.3 percent of gross domestic product this year, economists expect a 7.1 percent shortfall, according to data compiled by Bloomberg, increasing potential borrowing needs.
Bailout Deliberations
Prime Minister Mariano Rajoy continues to deliberate over whether to seek a European bailout that would allow the European Central Bank to buy Spanish bonds. He has said since Aug. 3 he would consider seeking a rescue, which would be the second after his government agreed to a 100 billion-euro credit line for the nation’s banks in June.
At the auction today, the Treasury sold notes maturing in 2015 at 3.617 percent, compared with 3.660 on Nov. 8. The current five-year benchmark was sold to yield 4.477 percent, compared with 4.525 percent on the secondary market before the sale and 4.766 percent at an auction in October. Bonds maturing in 2021 yielded 5.517 percent.
Demand was 2.09 times the amount sold for the 2015 bonds, down from 2.83 times on Nov. 8. It was 2.61 for the five-year notes, from 2.47 times on Oct. 4, and 1.77 for the 2021 bonds.
“Today’s Spanish sale was comfortable,” Raj Badiani, an economist at IHS Global Insight said in a note. “We continue to argue that the calmer Spanish sovereign financing environment is a temporary respite, given the profound economic and fiscal strains.”
The 10-year benchmark bond yield declined to 5.615 percent at 4:40 p.m. in Madrid from 5.709 percent yesterday. Spain’s borrowing cost have fallen from a euro-era record of 7.75 percent on July 25, before ECB President Mario Draghi first signaled the bank’s willingness to intervene in markets when he pledged to do whatever it takes to defend the euro.
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22 November 2012 Last updated at 20:32
EU budget summit opens with hard bargaining
David Cameron, UK PM: "These are very important negotiations"
Continue reading the main story
Related Stories
European Union leaders have begun talks on the bloc's seven-year budget, with many urging cuts in line with the savings they are making nationally.
The UK said the latest EU proposals were "a step in the right direction" but "did not go far enough" and more must be done to cut spending.
Poland and its ex-communist neighbours want current spending maintained or raised. They rely heavily on EU cash.
The bargaining in Brussels will continue on Friday, or even longer.
France's President Francois Hollande rejected proposals to cut spending on agriculture, saying "the Common Agricultural Policy is not a French policy but a European one". Traditionally France has been a big beneficiary of EU farm support.
UK Prime Minister David Cameron spent about half an hour talking to the President of the European Council, Herman Van Rompuy, and President of the European Commission Jose Manuel Barroso.
A Downing Street statement after the meeting said Mr Cameron had stressed the importance of the UK keeping its budget rebate, worth 3.56bn euros (£2.8bn; $1.3bn) in 2011. The statement called the rebate "fully justified". The Commission and some EU governments want the rebate scrapped.
The UK statement said "it was clear that there was a long way to go before we had a deal that reflected the difficult decisions being taken by member states".
Bilateral meetings went on longer than scheduled, delaying the official start of the summit until about 21:00 GMT.
Contrasting visions
The EU Commission, which drafts EU laws, has called for an increase of 4.8% compared with the 2007-2013 budget.
Continue reading the main story
Analysis Gavin Hewitt Europe editor, Brussels
The French have threatened to use their veto if farming subsidies are reduced. Some other countries like Denmark are fighting for a rebate of their own. So every step towards the British position creates problems elsewhere.
The Germans are not far from the Van Rompuy proposal and are prepared to compromise. They are protective of their neighbour Poland and do not want to see an important ally losing out.
But, like the British, they want to see a cut in administrative costs and want to see the budget re-balanced towards projects that enhance growth and innovation with less money for farm subsidies.
If a deal is done by Friday, when the summit is due to end, it will be a major achievement. The expectation is for the meeting to run into Saturday or to collapse.
But the UK and some other net contributors to the budget say cuts have to be made.
Negotiations are focusing on a draft budget - officially called the 2014-2020 Multi-Annual Financial Framework (MFF) - presented by Mr Van Rompuy.
He has made cuts to the Commission's original plan, and proposed a budget of 973bn euros (£782.5bn; $1,245bn).
Countries in central and eastern Europe oppose cuts to cohesion spending - that is, EU money that helps to improve infrastructure in poorer regions.
Agriculture and cohesion are the biggest budget items. The Van Rompuy plan envisages 309.5bn euros for cohesion (32% of total spending) and 364.5bn euros for agriculture (37.5%).
'Quite wrong'
German Chancellor Angela Merkel - who wants to restrain spending - says another summit may be necessary early next year if no deal can be reached in Brussels now.
Thursday's business began with short, individual meetings between national leaders and Mr Van Rompuy and Mr Barroso.
They were then due to assemble for talks as a group in the evening.
Arriving in Brussels, Mr Cameron said: "These are very important negotiations.
Continue reading the main story
Possible outcomes
"Clearly at a time when we are making difficult decisions at home over public spending it would be quite wrong, it is quite wrong, for there to be proposals for this increased extra spending in the EU."
However, Belgian Prime Minister Elio di Rupo argued the EU needed greater spending, not less.
"We can't have a European Union which demands, which imposes, and a European Union which doesn't have the means to implement its policies," he said.
The BBC's economics editor Stephanie Flanders says the amounts on the table are dwarfed by what governments spend nationally. The very worst that could happen is that the UK's contribution to the EU after 2013 might rise by about £500m a year, she says.
Hurdles
Mr Cameron has warned he may use his veto if other EU countries call for any rise in EU spending. The Netherlands and Sweden back his call for a freeze in spending, allowing for inflation.
Any of the 27 countries can veto a deal, and the European Parliament will also have to vote on the MFF even if a deal is reached.
Failure to agree on the budget would mean rolling over the 2013 budget into 2014 on a month-by-month basis, putting some long-term projects at risk.
If that were to happen it could leave Mr Cameron in a worse position, because the 2013 budget is bigger than the preceding years of the 2007-2013 MFF.
So the UK government could end up with an EU budget higher than what it says it will accept now.
The Commission says the EU budget accounts for less than 2% of public spending EU-wide and that for every euro spent by the EU, the national governments collectively spend 50 euros.
EU budget summit opens with hard bargaining
David Cameron, UK PM: "These are very important negotiations"
Continue reading the main story
Related Stories
European Union leaders have begun talks on the bloc's seven-year budget, with many urging cuts in line with the savings they are making nationally.
The UK said the latest EU proposals were "a step in the right direction" but "did not go far enough" and more must be done to cut spending.
Poland and its ex-communist neighbours want current spending maintained or raised. They rely heavily on EU cash.
The bargaining in Brussels will continue on Friday, or even longer.
France's President Francois Hollande rejected proposals to cut spending on agriculture, saying "the Common Agricultural Policy is not a French policy but a European one". Traditionally France has been a big beneficiary of EU farm support.
UK Prime Minister David Cameron spent about half an hour talking to the President of the European Council, Herman Van Rompuy, and President of the European Commission Jose Manuel Barroso.
A Downing Street statement after the meeting said Mr Cameron had stressed the importance of the UK keeping its budget rebate, worth 3.56bn euros (£2.8bn; $1.3bn) in 2011. The statement called the rebate "fully justified". The Commission and some EU governments want the rebate scrapped.
The UK statement said "it was clear that there was a long way to go before we had a deal that reflected the difficult decisions being taken by member states".
Bilateral meetings went on longer than scheduled, delaying the official start of the summit until about 21:00 GMT.
Contrasting visions
The EU Commission, which drafts EU laws, has called for an increase of 4.8% compared with the 2007-2013 budget.
Continue reading the main story
Analysis Gavin Hewitt Europe editor, Brussels The French have threatened to use their veto if farming subsidies are reduced. Some other countries like Denmark are fighting for a rebate of their own. So every step towards the British position creates problems elsewhere.
The Germans are not far from the Van Rompuy proposal and are prepared to compromise. They are protective of their neighbour Poland and do not want to see an important ally losing out.
But, like the British, they want to see a cut in administrative costs and want to see the budget re-balanced towards projects that enhance growth and innovation with less money for farm subsidies.
If a deal is done by Friday, when the summit is due to end, it will be a major achievement. The expectation is for the meeting to run into Saturday or to collapse.
But the UK and some other net contributors to the budget say cuts have to be made.
Negotiations are focusing on a draft budget - officially called the 2014-2020 Multi-Annual Financial Framework (MFF) - presented by Mr Van Rompuy.
He has made cuts to the Commission's original plan, and proposed a budget of 973bn euros (£782.5bn; $1,245bn).
Countries in central and eastern Europe oppose cuts to cohesion spending - that is, EU money that helps to improve infrastructure in poorer regions.
Agriculture and cohesion are the biggest budget items. The Van Rompuy plan envisages 309.5bn euros for cohesion (32% of total spending) and 364.5bn euros for agriculture (37.5%).
'Quite wrong'
German Chancellor Angela Merkel - who wants to restrain spending - says another summit may be necessary early next year if no deal can be reached in Brussels now.
Thursday's business began with short, individual meetings between national leaders and Mr Van Rompuy and Mr Barroso.
They were then due to assemble for talks as a group in the evening.
Arriving in Brussels, Mr Cameron said: "These are very important negotiations.
Continue reading the main story
Possible outcomes
- A deal after intense negotiations which may continue into the weekend
- Failure to agree and a follow-up budget summit
- If no agreement is reached by the end of 2013, the 2013 budget ceilings will be rolled over into 2014 with a 2% inflation adjustment, amid uncertainty over long-term EU projects
"Clearly at a time when we are making difficult decisions at home over public spending it would be quite wrong, it is quite wrong, for there to be proposals for this increased extra spending in the EU."
However, Belgian Prime Minister Elio di Rupo argued the EU needed greater spending, not less.
"We can't have a European Union which demands, which imposes, and a European Union which doesn't have the means to implement its policies," he said.
The BBC's economics editor Stephanie Flanders says the amounts on the table are dwarfed by what governments spend nationally. The very worst that could happen is that the UK's contribution to the EU after 2013 might rise by about £500m a year, she says.
Hurdles
Mr Cameron has warned he may use his veto if other EU countries call for any rise in EU spending. The Netherlands and Sweden back his call for a freeze in spending, allowing for inflation.
Any of the 27 countries can veto a deal, and the European Parliament will also have to vote on the MFF even if a deal is reached.
Failure to agree on the budget would mean rolling over the 2013 budget into 2014 on a month-by-month basis, putting some long-term projects at risk.
If that were to happen it could leave Mr Cameron in a worse position, because the 2013 budget is bigger than the preceding years of the 2007-2013 MFF.
So the UK government could end up with an EU budget higher than what it says it will accept now.
The Commission says the EU budget accounts for less than 2% of public spending EU-wide and that for every euro spent by the EU, the national governments collectively spend 50 euros.
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European Council: Major confusion over EU budget
22 November 2012
PresseuropThe Daily Telegraph, Público, El País & 4 others
Ruben L. Oppenheimer
Meeting in Brussels for an extraordinary European Council summit, Europe’s leaders are to about to outline the EU’s budget for years to come in an atmosphere that has already been marked by threats of a veto from various countries. The European press examines the bargaining process and attempts to identify the probable winners and losers.
Negotiations are to be based on proposals put forward by European Council President Herman Van Rompuy, which plan to trim € 75 billion from an initial figure of €1,048bn. Major contributing countries, especially the United Kingdom, want to see their contributions reduced, while smaller states are worried about cuts to the precious cohesion fund.
According to the Daily Telegraph’s leader–
Portugal goes to today’s summit fearing that its structural funds and rural development grants will be slashed by €5.25 billion. Público in Lisbon writes –
In Spain, El País expresses similar concerns about the cuts, which have come at the worst possible moment for Madrid –
In Budapest, the conservative daily Magyar Nemzet rails against an adjustment it believes to be unfair –
“Europe, don’t flinch” headlines Gazeta Wyborcza. The Warsaw daily notes that Van Rompuy’s compromise budget is quite good for Poland, adding that saving the proposal from further big cuts would be quite a success.
Le Monde looks at the national interests invoked by European capitals to defend against some of the budgetary options under discussion in Brussels and concludes that “the selfishness of European states” is largely “bogus”. For the Parisian daily, the insistence on “getting money back” which recalls former British Prime Minister Margaret Thatcher is part of a well rehearsed theatrical performance –
In a similar vein, Frankfurter Allgemeine Zeitung argues that the situation is hardly dramatic. Notwithstanding any outstanding divergences, it writes that the “EU budget is now on the home stretch” –
22 November 2012
PresseuropThe Daily Telegraph, Público, El País & 4 others
Ruben L. Oppenheimer
Meeting in Brussels for an extraordinary European Council summit, Europe’s leaders are to about to outline the EU’s budget for years to come in an atmosphere that has already been marked by threats of a veto from various countries. The European press examines the bargaining process and attempts to identify the probable winners and losers.
Negotiations are to be based on proposals put forward by European Council President Herman Van Rompuy, which plan to trim € 75 billion from an initial figure of €1,048bn. Major contributing countries, especially the United Kingdom, want to see their contributions reduced, while smaller states are worried about cuts to the precious cohesion fund.
According to the Daily Telegraph’s leader–
Mr Cameron (and, we trust, the leaders of other contributor countries whose taxpayers are similarly fed up with the institution’s shameless profligacy) is prepared to take a stand this time. Since the EU is negotiating a budget for the next seven years, this is the opportunity to put a brake on the Commission’s fiscal incontinence, an ambition that should be shared by those who worry that threats of a veto are jeopardising Britain’s long-term position in the EU. If anything, the arrogant refusal of Brussels to countenance any slimming down of its bloated bureaucracy is fomenting the very anti-Europeanism that the EU’s cheerleaders are anxious to avoid.
Portugal goes to today’s summit fearing that its structural funds and rural development grants will be slashed by €5.25 billion. Público in Lisbon writes –
The approval of budgets has always been a difficult task, but this time national interests, wounds opened by disagreements over the euro crisis, not to mention differing perceptions about the EU’s future have made a deal a mission well-nigh impossible. If the European Commission had the political strength of yore, perhaps member states would accept a 5% increase to the financial package. […] But, given the current balance of power, [Commission’s president José Manuel] Durão Barroso’s proposal was immediately reduced by the [European] Council president [Herman Van Rompuy] and, even then, still meets with reservations from various countries, which threaten to veto the proposal […] the cacophony grows shriller and Europe is coming closer to institutional chaos.
In Spain, El País expresses similar concerns about the cuts, which have come at the worst possible moment for Madrid –
If the [Van Rompuy] proposal is successful, Spain stands to lose € 20 billion. At a time when it is in the throes of a full-blown recession, it is about to become a net contributor to the EU for the first ever.
In Budapest, the conservative daily Magyar Nemzet rails against an adjustment it believes to be unfair –
It is absolutely scandalous and unacceptable that the cuts will benefit richer member states while undermining poorer ones. And not surprisingly, given this context, Hungarian Prime Minister Viktor Orbán can expect a special slap in the face: for mysterious reasons, Brussels wants to cut funding for Hungary by more than it does for any other member state.
“Europe, don’t flinch” headlines Gazeta Wyborcza. The Warsaw daily notes that Van Rompuy’s compromise budget is quite good for Poland, adding that saving the proposal from further big cuts would be quite a success.
Van Rompuy’s offer is very ‘German’. Berlin’s experts speculate an additional €2-3 bn could be offered to France for its farmers, while €2-3 bn will be taken away from Poland. Then we’ll have a deal. [...] The problem is that rational calculations are overshadowed by increasingly strong eurosceptic emotions in crisis-stricken Europe.
Le Monde looks at the national interests invoked by European capitals to defend against some of the budgetary options under discussion in Brussels and concludes that “the selfishness of European states” is largely “bogus”. For the Parisian daily, the insistence on “getting money back” which recalls former British Prime Minister Margaret Thatcher is part of a well rehearsed theatrical performance –
This selfish credo is far removed from the reality of the euro [...] Europeans do not want to stand together, but the truth is they do. Like an old couple that is unable to get a divorce and forced to share the same house, they have resorted to counting their pocket money to show their defiance.
In a similar vein, Frankfurter Allgemeine Zeitung argues that the situation is hardly dramatic. Notwithstanding any outstanding divergences, it writes that the “EU budget is now on the home stretch” –
Everywhere you look, the signs are encouraging. Even the British, who were threatening to use their veto, have welcomed the latest compromise presented by Herman Van Rompuy. […] In the context of the economic crisis, the fear of the extensive damage to the EU that could result from unsuccessful talks is simply too great. […] The strategy adopted by the Commission is clear: it does not want to burden major contributors with excessive demands. […] That is why Van Rompuy has planned on member states committing € 973 billion, which is close to the 960 billion recommended by Germany.
===================================
The discussions went late into the night and Members meet again this morning to try to get a resolution . Angela Merkel says the talks may have to continue tomorrow or even into next year.
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EU Budget: EU talks finish in deadlock - live
David Cameron has been accused of “blackmailing” other European Union leaders as talks on the trillion-euro EU budget finish in deadlock.
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Prime Minister David Cameron arrives for a second day of EU budget talks
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French President Francois Hollande arrives for a meeting with the president of the EC Herman Van Rompuy on the second day of the European Summit
By Matthew Sparkes
4:45PM GMT 23 Nov 2012
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16.45 Like the EU summit, the European markets have closed for the day. Unlike the summit, it all seems to have ended rather well - with the largest weekly gains so far this year. The mood is that Greece will soon get its next dose of much-needed bail-out cash.
The FTSE 100 has closed up 0.48pc on the day, the CAC is up 0.72pc and the DAX has gained 0.83pc.
Across the Atlantic the US markets have also been performing well, boosted by the Black Friday sales. Markets on Wall Street will close early at 1pm today.
The Dow Jones is 0.87pc higher, the S&P 500 has risen 0.91pc and the Nasdaq is up 1.12pc on the day.
16.34 The Telegraph's James Kirkup just asked David Cameron if he wantedto make an unambiguous, clear statement that no Government he leads will ever take the UK out of the EU. It seems that he didn't:
What I've said is very clear, I support our membership of the EU, but I don't support the status quo. I have a positive vision of what I want us to achieve in Europe. I would argue that Britain is listened to, has been listened to and will go on being listened to.
16.27 More from Cameron, who said that Brussels operates as if in a "parallel universe":
Britain has strong allies for a tough budget outcome. In the end we had a very strong case and I think we made the case with vigour.
16.13 Herman Van Rompuy has given a press conference, saying that an EU budget deal should be possible early next year. Next up is David Cameron:
Our position is very simple, we cannot increase spending in the EU when we're cutting it at home. We argued for a cut, or, at the very least, a freeze in spending.
We have had a good discussion, I think we understand each other's issues... but frankly the deal on the table was just not good enough.
We still believe a deal is absolutely doable. Freezing the budget is not an extreme proposition, it's eminently reasonable. It is possible and it would not result, in my view, in any hardship.
The British people will expect us to fight hard for a best deal for them and that's exactly what I intend to do. We haven't been able to secure agreement, but we've stopped what was an unacceptable proposal.
15.43 French sources suggest that there could be another summit in December, while Fabrizio Goria brings us this handy print-out-and-keep poster.
British sources say that Angela Merkel was "sympathetic" to its call for a reduction in the EU budget and that they also have the support of Sweden and The Netherlands in pushing for more austerity.
EU diplomats talking to AP said another summit was likely to be held early next year.
15.35 It's official: the summit is over, and there was no deal. The UK Government says that there's still deadlock over the budget.
15.29 Telegraph blogger Lord Tebbit of Chingford says that it's time for David Cameron to stand up to Europe over prisoners' votes, 'human rights' and the EU budget:
For the Commission to proclaim ever deeper reductions of expenditure as the route to salvation for Greece and ever more spending by Brussels as the route to salvation for the EU lacks a certain coherence. David Cameron did well to suggest that the Commission and its staff should work longer for less money and retire later. After all it is what they tell the Greeks. He should also explain to his colleagues in the Council that Parliament would not sanction such an increase in euro taxation and that is the end of the matter.
15.15 No one is quite sure, but the general feeling is that the summit will be coming to a close in about an hour. Although, by putting this in print, we may just have jinxed it. Stay tuned for more.
Twitter: JamesLyons - Are EU leaders struggling to agree on whether its worth carrying on struggling to agree?
Twitter: Tom Newton Dunn - A thousand fed up EU journalists await Van Rompuy's decision on whether they can go home tonight. http://t.co/5ls5AG0J
Twitter: Bruno Waterfield - #EUCO confusion some saying it's over others that it will go into tonight
14.55 David Cameron has been accused of “blackmailing” other European Union leaders as talks on the budget approached collapse.
Hannes Swoboda, president of the Socialists and Democrats group, said the summit had been “disastrous” and blamed the PM:
Regarding the additional cuts, it is unacceptable that the majority of member countries are letting themselves be blackmailed by David Cameron who is permanently threatening to block progress in the EU.
The British prime minister, who is considering leading the UK out of the EU, is having more impact on the future of the EU than those who are committed to strengthening the EU and fulfilling their obligations.
Hannes Swoboda
14.53 James Kirkup, deputy political editor for the Telegraph, brings us an update from Brussels:
Signs that the talks are about to break up. It surely can't have been the lunch: woodland mushrooms with comte fondue followed by filet of young venison then a cappucino minute. Certainly an improvement on last night's "cold cuts", served at around 11pm.
14.33 We reported Cypriot sources earlier as saying that they'd signed a deal with the troika over a bail-out. The IMF/EC/ECB have now issued a statement that basically says, "no, not yet":
Discussions are expected to continue from respective headquarters with a view to making further progress toward a potential program. The preliminary results of a bank due-diligence exercise, expected in the next few weeks, will inform discussions between official lenders and Cyprus on financing solutions consistent with debt sustainability.
14.18 A tweet from RTE News's Europe editor, Tony Connelly:
Twitter: Tony Connelly - Source says EU leaders will take a break shortly and go back to plenary later. Vibe is "not good" #euco
14.03 AFP has an interesting piece about the "travelling circus" that is the European Parliament, which leads a "pricey and nomadic life".
Once a month it shifts thousands of lawmakers, their staffs, translators and interpreters, to Strasbourg, 250 miles from Brussels, for a four-day meeting. And then it trucks them all back to Brussels again. This costs European taxpayers €180m a year.
Edward McMillan-Scott, a British Liberal Democrat, wrote in a letter to the Brussels daily De Standaard with three other MEPs:
If European leaders are serious about efficiency and fighting waste - especially within the European institutions - then the European Parliament's single-seat is a point of departure.
European citizens, and more than half of the European Parliament, demand an end to that travelling circus.
13.45 Those at the summit found time to post for a group photo earlier today, but there are suggestions that negotiations over the EU budget for 2014-2020 will now run into Saturday.
13.00 Fitch has cut the credit rating for several Cypriot banks. We'll bring you more details soon.
12.42 German lawmakers have rejected a deal that would have taxed German cash parked in Swiss bank accounts.
It would have anonymously taxed Germans directly from their Swiss accounts, with the money handed over to Berlin in one lump sum.
Germany's lower house approved it, but the Bundesrat are not so keen. Finance Minister of western North Rhine-Westphalia state Norbert Walter-Borjans said it was a deal which made "honest taxpayers feel like fools".
12.37 Open Europe has published a leaked copy of the draft EU budget, which currently stands at €1,014bn. That's an increase of €4bn, and the extra cash is being spent on higher farm subsidies and structural funds, it says.
12.03 Time for a bit of an update on the European markets as we hit midday. Shares are mixed, but have barely made any move from last night's closing prices. Sadly it looks as though there'll be no positive news from the EU summit to move them this afternoon.
The FTSE 100 is up 0.06pc, the CAC is down by 0.06pc and the DAX is off 0.01pc.
11.44 A scathing statement from a former Belgian Prime Minister here, via James Kirkup on Twitter:
Twitter: James Kirkup - Guy Verhofstadt MEP + former Belgian PM talking to UK journalists. Best line: 'It's not necessary to isolate Cameron. He isolates himself.'
11.15 Herman Van Rompuy has tweeted that the summit will start at midday, which means that they've been going for 15 minutes already - if they started on time.
Twitter: Herman Van Rompuy - 2nd summit day in search of #MFF deal. Second working #euco session will start at noon.
11.13 AFP reports that Francois Hollande and David Cameron will be meeting separately for budget talks, according to a French source.
10.48 Cyprus has agreed a bail-out deal with Europe. Spokesman Stefanos Stefanou says they're just awaiting official confirmation from Brussels. We'll bring you more on that as we have it.
10.43 The Guardian published a great graphic yesterday on the EU budget, showing that each UK citizen gives €180 each year to the EU and receives just €105 back.
Out of that sum, €11.38 will go on administration costs, €2.63 will go towards justice and €65.33 on farming.
10.32 We have a video of David Cameron arriving at the summit this morning. He's clearly in a hurry, but still has a moment to criticise the EU's "unaffordable spending".
David Cameron has been accused of “blackmailing” other European Union leaders as talks on the trillion-euro EU budget finish in deadlock.
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Prime Minister David Cameron arrives for a second day of EU budget talks
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French President Francois Hollande arrives for a meeting with the president of the EC Herman Van Rompuy on the second day of the European Summit
By Matthew Sparkes
4:45PM GMT 23 Nov 2012
514 Comments runUpdate = true;
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2012-11-23 16:51:29.0
http://www.telegraph.co.uk/finance/debt-crisis-live/9697742/EU-Budget-EU-talks-finish-in-deadlock-live.html?service=artBody
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• Cameron: deal on the table 'not good enough'
• EU summit ends without budget deal
• Eurocrat 'gravy train' exposed (see 10.15)
• German economy grew 0.2pc in third quarter
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16.45 Like the EU summit, the European markets have closed for the day. Unlike the summit, it all seems to have ended rather well - with the largest weekly gains so far this year. The mood is that Greece will soon get its next dose of much-needed bail-out cash.
The FTSE 100 has closed up 0.48pc on the day, the CAC is up 0.72pc and the DAX has gained 0.83pc. Across the Atlantic the US markets have also been performing well, boosted by the Black Friday sales. Markets on Wall Street will close early at 1pm today.
The Dow Jones is 0.87pc higher, the S&P 500 has risen 0.91pc and the Nasdaq is up 1.12pc on the day. 16.34 The Telegraph's James Kirkup just asked David Cameron if he wantedto make an unambiguous, clear statement that no Government he leads will ever take the UK out of the EU. It seems that he didn't:
What I've said is very clear, I support our membership of the EU, but I don't support the status quo. I have a positive vision of what I want us to achieve in Europe. I would argue that Britain is listened to, has been listened to and will go on being listened to. 16.27 More from Cameron, who said that Brussels operates as if in a "parallel universe":
Britain has strong allies for a tough budget outcome. In the end we had a very strong case and I think we made the case with vigour. 16.13 Herman Van Rompuy has given a press conference, saying that an EU budget deal should be possible early next year. Next up is David Cameron:
Our position is very simple, we cannot increase spending in the EU when we're cutting it at home. We argued for a cut, or, at the very least, a freeze in spending. We have had a good discussion, I think we understand each other's issues... but frankly the deal on the table was just not good enough.
We still believe a deal is absolutely doable. Freezing the budget is not an extreme proposition, it's eminently reasonable. It is possible and it would not result, in my view, in any hardship.
The British people will expect us to fight hard for a best deal for them and that's exactly what I intend to do. We haven't been able to secure agreement, but we've stopped what was an unacceptable proposal.
15.43 French sources suggest that there could be another summit in December, while Fabrizio Goria brings us this handy print-out-and-keep poster. British sources say that Angela Merkel was "sympathetic" to its call for a reduction in the EU budget and that they also have the support of Sweden and The Netherlands in pushing for more austerity.
EU diplomats talking to AP said another summit was likely to be held early next year.
15.35 It's official: the summit is over, and there was no deal. The UK Government says that there's still deadlock over the budget.
15.29 Telegraph blogger Lord Tebbit of Chingford says that it's time for David Cameron to stand up to Europe over prisoners' votes, 'human rights' and the EU budget:
For the Commission to proclaim ever deeper reductions of expenditure as the route to salvation for Greece and ever more spending by Brussels as the route to salvation for the EU lacks a certain coherence. David Cameron did well to suggest that the Commission and its staff should work longer for less money and retire later. After all it is what they tell the Greeks. He should also explain to his colleagues in the Council that Parliament would not sanction such an increase in euro taxation and that is the end of the matter. 15.15 No one is quite sure, but the general feeling is that the summit will be coming to a close in about an hour. Although, by putting this in print, we may just have jinxed it. Stay tuned for more.
Twitter: JamesLyons - Are EU leaders struggling to agree on whether its worth carrying on struggling to agree?
Twitter: Tom Newton Dunn - A thousand fed up EU journalists await Van Rompuy's decision on whether they can go home tonight. http://t.co/5ls5AG0J
Twitter: Bruno Waterfield - #EUCO confusion some saying it's over others that it will go into tonight
14.55 David Cameron has been accused of “blackmailing” other European Union leaders as talks on the budget approached collapse.
Hannes Swoboda, president of the Socialists and Democrats group, said the summit had been “disastrous” and blamed the PM:
Regarding the additional cuts, it is unacceptable that the majority of member countries are letting themselves be blackmailed by David Cameron who is permanently threatening to block progress in the EU. The British prime minister, who is considering leading the UK out of the EU, is having more impact on the future of the EU than those who are committed to strengthening the EU and fulfilling their obligations.
Hannes Swoboda
14.53 James Kirkup, deputy political editor for the Telegraph, brings us an update from Brussels:
Signs that the talks are about to break up. It surely can't have been the lunch: woodland mushrooms with comte fondue followed by filet of young venison then a cappucino minute. Certainly an improvement on last night's "cold cuts", served at around 11pm. 14.33 We reported Cypriot sources earlier as saying that they'd signed a deal with the troika over a bail-out. The IMF/EC/ECB have now issued a statement that basically says, "no, not yet":
Discussions are expected to continue from respective headquarters with a view to making further progress toward a potential program. The preliminary results of a bank due-diligence exercise, expected in the next few weeks, will inform discussions between official lenders and Cyprus on financing solutions consistent with debt sustainability. 14.18 A tweet from RTE News's Europe editor, Tony Connelly:
Twitter: Tony Connelly - Source says EU leaders will take a break shortly and go back to plenary later. Vibe is "not good" #euco
14.03 AFP has an interesting piece about the "travelling circus" that is the European Parliament, which leads a "pricey and nomadic life".
Once a month it shifts thousands of lawmakers, their staffs, translators and interpreters, to Strasbourg, 250 miles from Brussels, for a four-day meeting. And then it trucks them all back to Brussels again. This costs European taxpayers €180m a year.
Edward McMillan-Scott, a British Liberal Democrat, wrote in a letter to the Brussels daily De Standaard with three other MEPs:
If European leaders are serious about efficiency and fighting waste - especially within the European institutions - then the European Parliament's single-seat is a point of departure. European citizens, and more than half of the European Parliament, demand an end to that travelling circus.
13.45 Those at the summit found time to post for a group photo earlier today, but there are suggestions that negotiations over the EU budget for 2014-2020 will now run into Saturday.
13.00 Fitch has cut the credit rating for several Cypriot banks. We'll bring you more details soon.
12.42 German lawmakers have rejected a deal that would have taxed German cash parked in Swiss bank accounts.
It would have anonymously taxed Germans directly from their Swiss accounts, with the money handed over to Berlin in one lump sum.
Germany's lower house approved it, but the Bundesrat are not so keen. Finance Minister of western North Rhine-Westphalia state Norbert Walter-Borjans said it was a deal which made "honest taxpayers feel like fools".
12.37 Open Europe has published a leaked copy of the draft EU budget, which currently stands at €1,014bn. That's an increase of €4bn, and the extra cash is being spent on higher farm subsidies and structural funds, it says.
12.03 Time for a bit of an update on the European markets as we hit midday. Shares are mixed, but have barely made any move from last night's closing prices. Sadly it looks as though there'll be no positive news from the EU summit to move them this afternoon.
The FTSE 100 is up 0.06pc, the CAC is down by 0.06pc and the DAX is off 0.01pc. 11.44 A scathing statement from a former Belgian Prime Minister here, via James Kirkup on Twitter:
Twitter: James Kirkup - Guy Verhofstadt MEP + former Belgian PM talking to UK journalists. Best line: 'It's not necessary to isolate Cameron. He isolates himself.'
11.15 Herman Van Rompuy has tweeted that the summit will start at midday, which means that they've been going for 15 minutes already - if they started on time.
Twitter: Herman Van Rompuy - 2nd summit day in search of #MFF deal. Second working #euco session will start at noon.
11.13 AFP reports that Francois Hollande and David Cameron will be meeting separately for budget talks, according to a French source.
10.48 Cyprus has agreed a bail-out deal with Europe. Spokesman Stefanos Stefanou says they're just awaiting official confirmation from Brussels. We'll bring you more on that as we have it.
10.43 The Guardian published a great graphic yesterday on the EU budget, showing that each UK citizen gives €180 each year to the EU and receives just €105 back.
Out of that sum, €11.38 will go on administration costs, €2.63 will go towards justice and €65.33 on farming.
10.32 We have a video of David Cameron arriving at the summit this morning. He's clearly in a hurry, but still has a moment to criticise the EU's "unaffordable spending".
10.15 An update now from Bruno Waterfield, our man in Brussels: 
Oh dear, it's pots calling kettles black time. The world of EU officialdom has been stung by David Cameron's criticisms of the “gravy train” pay and perks enjoyed by eurocrats.
Officials from the European Commission, the Council of the EU and the euro-parliament have hit back by publishing figures that show senior British officials to be just as bad as they are - or even worse.
A "rebuttal" sheet given to UK correspondents shows that while the “purchasing power” of EU officials has declined 7.6pc, it has only gone down by 3.2pc for British public servants.
While eurocrats work a 37.5 hour working week, soon to rise to 40, British bureaucrats only put in 36 hours.
The top salary for a Brussels bureaucrat is an impressive €16,919 a month. But, shows the EU rebuttal sheet, top for a British civil servant is €25,000. While eurocrats can look forward to a 70pc final salary pension, “highest earning” British civil servants can trouser 75pc.
So after the Prime Minister called for cuts to the generous pensions and pay for eurocrats now we have the undignified spectacle of Brussels officials slinging mud at Whitehall mandarins.
It can only end in tears and confirm the popular prejudice that ALL officials, whether of the EU or British variety, do very nicely thank you in spite of the cold winds of austerity blowing elsewhere. 
Panda- Platinum Poster
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Re: New EC Thread
Panda Fri 23 Nov - 17:28
htthttp://www.guardian.co.uk/world/interactive/2012/nov/22/eu-budget-interactive-money?wt_gu
Can someone open up the link to paste the graph please? thanks.
Can someone open up the link to paste the graph please? thanks.
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Re: New EC Thread
malena stool Fri 23 Nov - 20:26
I don't know how to do it Panda... Sorry.Panda wrote:htthttp://www.guardian.co.uk/world/interactive/2012/nov/22/eu-budget-interactive-money?wt_gu
Can someone open up the link to paste the graph please? thanks.
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