Daily Press Summary
El País: European Commission working on ‘growth plan’ to attract €200bn in investment; Money left in EU bailout fund guaranteed by all member states could be used as leverage
El País reports that the European Commission is working on a ‘growth plan’ to attract €200bn in investment into infrastructure, green energy and high technology. According to the paper, two options are being considered at the moment. The first one, less likely, would see EU member states boosting the capital of the European Investment Bank by an additional €10bn. The second option would see the €12bn left in the European Financial Stabilisation Mechanism (EFSM) – the EU’s bailout fund which the UK signed up to in 2010 – being used as a leverage to raise up to €200bn in investment from the private sector.
Meanwhile, in an interview with German regional daily Leipziger Volkszeitung on Saturday, German Chancellor Angela Merkel confirmed that Germany is working on a ‘growth agenda’ to be discussed at the summit of EU leaders in June, but reiterated that “there will be no re-negotiation of the fiscal treaty.” In an interview with French Radio J yesterday, French Socialist presidential candidate François Hollande said he appreciated that Merkel “has made a move” on growth, and suggested that she would “move even more” after the results of the second round of the French presidential election on 6 May.
Separately, Italian daily La Repubblica reports that Germany and Italy are considering ratifying both the fiscal treaty and the treaty establishing the eurozone’s permanent bailout fund, the ESM, on the same day in a show of political unity. However, the leader of Germany’s opposition SDP party, Frank-Walter Steinmeier, has warned that the Bundestag will not be able to ratify the fiscal treaty by the end of May, since Merkel has not offered the opposition sufficient concessions on growth and a financial transactions tax.
Euractiv Reuters Welt Leipziger Volkszeitung El País Il Sole 24 Ore Le Monde Le Monde La Tribune Le Monde Les Echos Les Echos 2 La Tribune Saturday's Times Saturday's Guardian Saturday's Guardian 2 Saturday's Guardian: Leader FT Weekend FT Weekend: Barber & Spiegel Saturday's Telegraph Irish Times Times LVZ: Merkel Repubblica 2 Saturday's Süddeutsche
Spain mulls ‘bad bank’ scheme as double dip recession is confirmed
Standard & Poor’s downgraded 11 Spanish banks this morning as the Spanish government held talks over a scheme to help shift toxic real estate assets off the books of Spanish banks. The government is refusing to call the scheme a ‘bad bank’ since under current plans banks will only be eligible to shift their assets if they have already set aside sufficient provisions against bad loans. It is still unclear how banks would raise these provisions and whether it would require public funds. Writing in Saturday’s Telegraph, Business Editor Alistair Osborne cites Open Europe’s figures showing that Spanish banks have only €50bn in provisions against €400bn in loans to the bust real estate and construction sector.
Data released today showed that the Spanish economy contracted by 0.3% in the first quarter of this year, slightly less than expected but enough to push the country back into recession. Meanwhile, thousands of people took to the streets in over 50 Spanish cities yesterday to protest against the current austerity measures.
FT FT Lex CityAM WSJ Expansión Les Echos El País 2 Telegraph Times Le Monde Le Monde 2 Les Echos 2 Les Echos 3 Saturday's Guardian Saturday's Mail FT Weekend FT Weekend 2 FT Weekend: Leader Saturday's Telegraph Saturday's Telegraph: Osborne Le Monde 2 La Tribune Le Monde 3
Cameron: Eurozone needs to decide whether to push ahead with single economic policy
Speaking on the BBC’s Andrew Marr show Prime Minister David Cameron said, “I don’t think we’re anywhere near halfway through [the eurozone crisis] because what’s happening in the eurozone is a massive tension between the single currency that countries are finding very difficult to adapt to. It's going to be a very long and painful process in the eurozone as they work out do they want a single currency with a single economic policy and all the things that go with it, or are they going to have something quite different?"
The Times quotes Open Europe Director Mats Persson as saying that Mr Cameron’s latest comments were “unwise” because they could further sour Britain’s relations with Berlin. “We have been critical of the way the UK Government has almost been lecturing the eurozone on what it should be doing,” he said. “There is huge scope for improvement [in diplomatic relations], and this does not help.”
In the FT, Paul Goodman argues that the EU is “not the main cause” of UKIP’s recent rise. However, in the Times, Professor Vernon Bogdanor writes, “Until now, UKIP’s progress has been hampered by voters’ reluctance to consider Europe as important as the economy or the public services. But this may be about to change…The crisis in the eurozone will accelerate the process still further.”
Telegraph Mail Sun Express Independent Times FT: Goodman Times: Bogdanor
Saturday’s Sun featured Open Europe’s briefing on the proposed increase in the EU’s 2013 budget, which notes that the Commission’s proposed staff cuts only amount to a net loss of 6 out of almost 41,000 jobs. Open Europe’s Pawel Swidlicki was quoted as saying the move was “particularly galling considering that thousands of public sector posts are being cut in the UK and other member states...The Commission’s claims that it is making tough decisions simply aren’t credible.” The briefing was also cited by FT Alphaville and Italian financial website Linkiesta.
Open Europe press release Saturday's Sun FT Alphaville Linkiesta
City AM reports that HM Treasury has outlined 10 pages of changes it wants made to new EU rules on how much capital banks must keep in reserve, known as CRD IV.
Open Europe research City AM WSJ Bloomberg
Sarkozy: “Europe is weakening the concept of the Nation”
In a speech last night, Nicolas Sarkozy upped his patriotic rhetoric, accusing Europe of “weakening the concept of the Nation” and stressing the “crucial importance of borders in a globalised world”. He stated “France wanted Europe, and France expects that Europe will protect European people”. On Europe 1 this morning, Socialist candidate Francois Hollande dismissed Sarkozy’s claim that borders had become the cornerstone of the 2012 election campaign, and argued that any control on entry should be determined at the European level.
The latest polls ahead of Sunday’s second round run-off show that the gap between Hollande and Sarkozy has narrowed, although the socialist frontrunner still leads on 53%, ahead of Sarkozy on 47%. Sarkozy’s rise is attributed to his success in winning over centrist Francois Bayrou voters, and Hollande’s inability to convince far-left Jean-Luc Melenchon supporters.
Le Monde Liberation Guardian Times Saturday's Times FT Weekend Liberation FT WSJ Le Journal de Dimanche Le Monde 2
La Stampa reports that the leader of Italy’s centre-left Democratic Party, Pier Luigi Bersani, has ruled out early elections in October, saying, “I don’t want to win on my own country’s rubble.” Meanwhile, centrist leader Pierferdinando Casini – whose party supports Italian Prime Minister Mario Monti’s government – has for the first time openly said that he wants Monti to stand in the next general elections, due in 2013.
Il Sole 24 Ore Il Sole 24 Ore 2 Repubblica La Stampa AGI
The FT Weekend reported that the Dutch government was able to submit its budget plans for cutting its deficit to 3% to the Commission ahead of schedule. A snap poll by Maurice de Hond found that the three opposition parties which supported the deal allowing it to be pushed through parliament saw a jump in their support.
Ahead of the Greek elections, Panos Kammenos, leader of the Independent Greeks party, currently polling at 10%, said, “The German government is trying, through economic policy, to conquer Europe…The Germans are trying to force submission on the rest of Europe and create a fourth economic Reich.”
FT WSJ Saturday's Times
US regulators have refused to alter their insurance rules to comply with the EU’s Solvency II regulations. Meanwhile, Fitch Ratings has warned that Solvency II could limit banks’ ability to securitise a wide variety of loans, and thereby hamper lending in the eurozone.
FT FT 2
Romania’s government fell on Friday, toppled by a no-confidence motion on its unpopular austerity policies. Meanwhile, the Czech government survived its confidence vote but has promised pro-growth measures, following protests and threats of strike action from union leaders.
FT Weekend FT FTD
Writing in the WSJ, Marian Tupy of the CATO Institute argues that leaders in Central and Eastern Europe should “not ignore the rising costs of their EU membership.”
Angel Merkel’s junior coalition partner, the liberal FDP party has crossed the 5% mark for the first time since August 2011 according to an Emnid poll for Bild am Sonntag. Merkel’s CDU leads on 35% ahead of the SPD on 26%, the Greens on 13%, the Pirate party on 11% and Die Linke on 7%. However, polls show the SPD leads the CDU by 38% to 32% in polls ahead of next week’s regional elections in Nordrhein-Westfalen, Germany’s most populous state.
Handelsblatt Bild Bild 2
The Mail on Sunday reported that the European Commission has proposed changes to EU regional development funding rules which would mean that any organisation managing development funding would have to fly the EU flag permanently.
Mail on Sunday
The Sunday Times reported that the European Commission has signed a £10m deal with an exclusive private air-taxi provider to fly Baroness Ashton, Jose Manuel Barroso, Herman van Rompuy, on overseas visits.
Sunday Times Mail Knack
A growing number of German politicians including SDP chairman Sigmar Gabriel and CDU Environment Minister Norbert Röttgen, as well as EU Justice Commissioner Viviane Reding, have called for a political boycott of Ukraine during this summer’s European football championships over its government’s continued imprisonment of former PM Julia Tymoshenko.
Guardian EUobserver Le Monde Bild Welt
Saturday’s Times reported that the Government is facing calls to scrap plans to buy US warplanes for Britain’s new aircraft carriers and instead switch to the existing Eurofighter Typhoon model that could be adapted to launch and land from the sea.