16 February 2015

Much of Eurozone less confident on a deal than Greece at today’s crucial meeting

Today’s meeting of Eurozone finance ministers in Brussels has been highlighted as the final chance for an agreement on Greece given the need for approval from certain national parliaments. Greek Finance Minister Yanis Varoufakis said recent discussions had given him “a significant degree of hope” that a deal will be found, “even at the eleventh hour”, given that the two sides have “already agreed on a lot”. In an interview with German magazine Der Spiegel, Varoufakis insisted that a write-down of Greek debt “would even be cheaper for creditors than a loan extension.”

However, in an interview with Deutschlandfunk radio this morning, German Finance Minister Wolfgang Schäuble said he was “very sceptical” about a deal being reached. He added that he believed the Greek government is behaving “quite irresponsibly”. In an interview with ZDF, Austrian Finance Minister Hans-Jörg Schelling said the Greek government appeared to still be “in election mode, not working mode.”

Reports suggest the two sides remain some way from an agreement on details. In an interview with Europe 1, French Foreign Minister Laurent Fabius said, “It is out of the question to cancel [Greece’s] debt, we can discuss its maturity”, and added that talks are “moving slowly”. Greek government spokesman Gabriel Sakellaridis said an interview with Skai TV that the government will “stick to its commitment towards the public…and not continue a programme that has the characteristics of the previous bailout agreement.” Panagiotis Lafazanis, Greek Energy Minister and leader of SYRIZA’s hard-line left wing, said that, “If our so-called partners insist on an extension of the current programme in one form or another – the sinful memorandum – there won’t be an agreement.”

Open Europe’s Raoul Ruparel is quoted on the front page of City AM highlighting that Greek banks are reliant on ECB liquidity to help them buy up short-term debt and keep the Greek government funded. The paper also features a graphic outlining Open Europe’s assessment of Greece’s demands for a bridge deal with its creditors.

Source: Reuters Kathimerini City AM Der Spiegel

Daily Shakeup RSS Feed

New ceasefire appears to hold in Eastern Ukraine

The ceasefire between Ukrainian forces and pro-Russian separatists, agreed in Minsk last week, came into effect yesterday and appears to be largely holding for the moment. However, some fighting has continued around the besieged town of Debaltseve. Eduard Basurin, a senior commander of the pro-Russian separatist forces, told Reuters, “Of course we can open fire [on Debaltseve]. It is our territory.”

Source: The Financial Times The Wall Street Journal Reuters

SPD wins Hamburg elections, as CDU crashes and AfD wins first seats in Western Germany

The SPD won yesterday’s regional elections in Hamburg with 45.7% (-2.7%) of the vote, ahead of Chancellor Angela Merkel’s CDU on 15.9% (-6%), the Greens on 12.2% (+1%), Die Linke on 8.5% (+2.1%), the FDP on 7.1% (+0.7%) and the anti-euro AfD on 6.1% (+6.1%). This is the first time AfD has won seats in Western Germany. However, Die Welt reports that several prominent figures from the party’s conservative wing – including its co-chairman Konrad Adam and its leader in Saxony Frauke Petry – have criticised the Hamburg campaign for focusing too heavily on economic liberalism.

Source: Die Welt Frankfurter Allgemeine Zeitung Süddeutsche Zeitung Bild

Sweden, UK and Netherlands refuse to sign off on EU budget discharge

Europaportalen reports that Sweden has refused to approve the discharge of the 2013 annual EU budget – a symbolic gesture in protest at the way the budget was spent. The country has not signed off on annual EU budgets for the last four years. Swedish Finance Minister Magdalena Andersson said, “We think that the error rate is too high. There is a target of 2% and we are far beyond that.” She noted that the UK and Netherlands also refused to sign off on the 2013 EU budget.

Source: Europaportalen

Lord Howell: Britain is not alone in challenging outdated EU centralism

Lord Howell, a Foreign Office Minister from 2010-2012, argues that EU treaty change is “inevitable” because the EU’s traditional structures are ill-suited to today’s global economy, which is “characterised by new trading patterns, product processes and business methods, [and] has been transformed by digital technology and revolutionary change.” Lord Howell argues that the desire for reform is widespread, and that “Britain’s proposals for change must be harnessed to reforming Europe, and to building alliances with governments, leaders and groups who share similar aims, if any deal or negotiating process is to succeed.”

Source: Politeia: Lord Howell

How EU renegotiation will happen and how to pursue it – Guest essay by David Frost

Open Europe has today published a guest essay by David Frost – until recently Britain’s most senior trade diplomat – setting out how the UK can best pursue an EU renegotiation if the Government follows this course after the General Election. David argues that for David Cameron – or any other Prime Minister – to conduct a successful negotiation on this scale in Europe, the UK government must change its own organisation and focus, including appointing a Ministerial Lead Negotiator to manage day-to-day talks. He also notes that many would see David Cameron’s current reform agenda as rather unambitious, but that any attempt to secure fundamental reform would require much more preparation with EU partners to ensure the reforms are seen as reasonable and possible.

To read the full essay, click here.