The first four instalments were Transparency during the eurozone crises and Euro crises: European Council eviscerated? and Eurozone governance: Fundamental flaws but better presentation and Euro crises exposed and added to EU lack of legitimacy and democracy. The articles were based on my speech at the 22 February 2012 Attac seminar about the implications of the new fiscal discipline in the EU. These blog entries contain some modifications, updates and documentary references, which complement the oral presentation.
Here I continue the discussion with facts and opinion beyond the short address.
”Comprehensive solutions”
After umpteen ”comprehensive solutions”, the limits at EU and eurozone level are finally sinking in (although the solutions deemed possible and necessary are likely to drive us to distraction or despair).
In The European Council in 2011, the tone of EUCO and Euro Summit president Herman Van Rompuy was quite sober. In the General Report on the Activities of the European Union 2011, even Commission president José Manuel Barroso had toned down his often flowery rhetoric.
”Victories” had turned sour often enough for a mood of quiet determination to become appropriate.
Breathtaking, still...
Still, what the cascade of conclaves, summits and institutions has churned out during a short period is breathtaking by EU standards, and ordinary citizens of the union have most certainly been left out of breath by:
The European Financial Stability Facility (EFSF) of the euro countries (beefed up), the European Financial Stabilisation Mechanism of the EU, the permanent European Stability Mechanism (ESM) already beefed up, the integrated planning tool the European Semester, with the Annual Growth Survey (AGS), the Euro Plus Pact (23 countries), the six-pack legislation, the Green Paper on eurobonds (sorry, stability bonds), the two-pack proposals, the TSCG or ”fiscal compact” to be signed, the Commission's first Alert Mechanism Report, as well as the rescue packages for Ireland and Portugal, and now twice into the seemingly bottomless pit of Greece, firefighting in Spain and Italy etc.
Fast and unprecedented by EU standards, but we are still far from where we should be.
Without the operations of the much vilified European Central Bank (in conjunction with other central banks in the world), meltdown would probably have occurred in the eurozone in December or a little later, with disastrous consequences for Europe and the global economy.
We have seen emergency solutions to the financial and economic ills, but not acknowledgement of the root cause, the political crisis at the bottom of this.
The crucial issues of legitimacy, democracy, sufficient powers, accountability and transparency have been almost totally absent from the discourse of the national and EU leaders, and these challenges have figured only marginally in the wider public debate.
Essentially, our leaders communicate their desire for nicer interior design of the prison they have built for themselves and their hope that the crises will somehow go away.
Are we getting what we deserve to get? Or, should we upgrade our thinking and that of our leaders?
Ralf Grahn
speaker on EU affairs, especially digital policy and law
P.S. 1: For better or for worse, between the global issues and the national level, the European Union institutions and the eurozone coteries shape our future. At the same time we see an emerging European online public sphere. More than 900 euroblogs are aggregated by multilingual Bloggingportal.eu. Is your blog already listed among them? Are you following the debates which matter for your future?
P.S. 2: Referring the anti-piracy treaty #ACTA to the Court of Justice of the European Union (CJEU) marks a lull in the proceedings, but not an end to the political battle. A few moments ago, the online petition launched by @Avaaz for the European Parliament (and the national parliaments) to reject ACTA had already been signed by 2,444,822 netizens, but more are welcome until the official burial.
Showing posts with label crisis. Show all posts
Showing posts with label crisis. Show all posts
Monday, 27 February 2012
Saturday, 25 February 2012
Euro crises: European Council eviscerated?
The European Council was inaugurated as the supremo among the official EU institutions just two years ago, by the Lisbon Treaty. A cascade of meetings, both official ones and inofficial summits, has followed during the financial, sovereign debt and economic crises.
It may sound paradoxical, but my feeling is that the European Council has been gutted by the euro area crises and by design.
This blog post continues the discussion in the entry Transparency during the eurozone crises, based on my presentation at the 22 February 2012 Attac seminar, but with some modifications, updates and documentary references.
Eviscerated European Council?
Already, the latest statements from the informal summits for the EU as a whole, such as 26 October 2011, and the formal European Council conclusions, 23 october 2011 (EUCO 52/1/11) and 9 December 2011 (EUCO 139/1/11), look pretty anaemic.
It is as if the European Council had been eviscerated, emptied of content of late.
The spring meeting has traditionally been dedicated to all aspects of economic issues, but we have to wait to see what EUCO produces in terms of substance 1-2 March 2012 in the light of the EUCO annotated draft agenda (Council document 5354/12).
Summit or EU institution?
The first two years of the European Council as an official EU institution could be marked down as a lost opportunity with regard to openness and closeness to the citizen of the European Union.
In the beginning, EUCO president Herman Van Rompuy underlined that the European Council was an official institution, but in practice it continued to act as an international summit between leaders, without adopting practices of openness and good governance.
By this I mean in particular the preparatory phase from the Council configurations through the coordinating General Affairs Council (GAC), which has proved a real disappointment.
In order to illustrate the point, I ask you to look at the draft agenda of the GAC and the background note ahead of the 28 February 2012 meeting. Do we see clear proposals going in and can we expect the GAC to make public propositions to EUCO for public debate ahead of conclusions?
For comparison, we also have the customary annotated agenda from the government of Sweden: Allänna rådets möte den 28 februari 2012 – Kommenterad dagordning. Thin, is how I see it, instead of a clear paper trail from proposal to discussion, with public debate in between.
***
Perhaps some of us find it comforting to see that we citizens are in such noble company – at least in part with the heads of state or government of the non-euro states – watching more of real policy making disappear into the even bigger black hole of beefed-up Eurogroup support and the permanent Euro Summit.
Perhaps some of us are comfortable with the GAC and EUCO continuing to labour in the mode of diplomatic conferences, instead of as accountable and transparent institutions of European government and governance.
Perhaps we should not be. Yesterday, the Swedish economist Anders Bäckstrand wrote on Europaportalen that the euro crisis has started a process towards a more distinctly political Europe, but political legitimacy is necessary for this to succeed.
Ralf Grahn
speaker on EU affairs, especially digital policy and law
P.S. 1: For better or for worse, between the global issues and the national level, the European Union institutions and the eurozone coteries shape our future. At the same time we see a European public sphere emerging. More than 900 euroblogs are aggregated by multilingual Bloggingportal.eu. Is your blog already listed among them? Are you following the debates which matter for your future?
P.S. 2: Referring the anti-piracy treaty #ACTA to the Court of Justice of the European Union (CJEU) marks a lull in the proceedings, but not an end to the political battle. A few moments ago, the online petition launched by @Avaaz for the European Parliament (and the national parliaments) to reject ACTA had already been signed by 2,427,119 netizens, but more are welcome until the official burial.
Today, Saturday 25 February 2012, European netizens join forces through more than 150 demonstrations for open and democratic legislation and Internet freedoms. In Finland Stop ACTA Helsinki convenes in front of the Central Railway Station at 14:00 hours.
It may sound paradoxical, but my feeling is that the European Council has been gutted by the euro area crises and by design.
This blog post continues the discussion in the entry Transparency during the eurozone crises, based on my presentation at the 22 February 2012 Attac seminar, but with some modifications, updates and documentary references.
Eviscerated European Council?
Already, the latest statements from the informal summits for the EU as a whole, such as 26 October 2011, and the formal European Council conclusions, 23 october 2011 (EUCO 52/1/11) and 9 December 2011 (EUCO 139/1/11), look pretty anaemic.
It is as if the European Council had been eviscerated, emptied of content of late.
The spring meeting has traditionally been dedicated to all aspects of economic issues, but we have to wait to see what EUCO produces in terms of substance 1-2 March 2012 in the light of the EUCO annotated draft agenda (Council document 5354/12).
Summit or EU institution?
The first two years of the European Council as an official EU institution could be marked down as a lost opportunity with regard to openness and closeness to the citizen of the European Union.
In the beginning, EUCO president Herman Van Rompuy underlined that the European Council was an official institution, but in practice it continued to act as an international summit between leaders, without adopting practices of openness and good governance.
By this I mean in particular the preparatory phase from the Council configurations through the coordinating General Affairs Council (GAC), which has proved a real disappointment.
In order to illustrate the point, I ask you to look at the draft agenda of the GAC and the background note ahead of the 28 February 2012 meeting. Do we see clear proposals going in and can we expect the GAC to make public propositions to EUCO for public debate ahead of conclusions?
For comparison, we also have the customary annotated agenda from the government of Sweden: Allänna rådets möte den 28 februari 2012 – Kommenterad dagordning. Thin, is how I see it, instead of a clear paper trail from proposal to discussion, with public debate in between.
***
Perhaps some of us find it comforting to see that we citizens are in such noble company – at least in part with the heads of state or government of the non-euro states – watching more of real policy making disappear into the even bigger black hole of beefed-up Eurogroup support and the permanent Euro Summit.
Perhaps some of us are comfortable with the GAC and EUCO continuing to labour in the mode of diplomatic conferences, instead of as accountable and transparent institutions of European government and governance.
Perhaps we should not be. Yesterday, the Swedish economist Anders Bäckstrand wrote on Europaportalen that the euro crisis has started a process towards a more distinctly political Europe, but political legitimacy is necessary for this to succeed.
Ralf Grahn
speaker on EU affairs, especially digital policy and law
P.S. 1: For better or for worse, between the global issues and the national level, the European Union institutions and the eurozone coteries shape our future. At the same time we see a European public sphere emerging. More than 900 euroblogs are aggregated by multilingual Bloggingportal.eu. Is your blog already listed among them? Are you following the debates which matter for your future?
P.S. 2: Referring the anti-piracy treaty #ACTA to the Court of Justice of the European Union (CJEU) marks a lull in the proceedings, but not an end to the political battle. A few moments ago, the online petition launched by @Avaaz for the European Parliament (and the national parliaments) to reject ACTA had already been signed by 2,427,119 netizens, but more are welcome until the official burial.
Today, Saturday 25 February 2012, European netizens join forces through more than 150 demonstrations for open and democratic legislation and Internet freedoms. In Finland Stop ACTA Helsinki convenes in front of the Central Railway Station at 14:00 hours.
Sunday, 19 February 2012
The European Council in 2011 (publication)
The Treaty of Lisbon, which entered into force on 1 December 2009, made the European Council (EUCO) an official institution of the European Union. It consists of the head of state or government of each member state of the EU, as well as without a vote, the president of the European Commission (José Manuel Barroso) and the EUCO president elected for two and a half years by the 27 national leaders (Herman Van Rompuy).
The first two years of the European Council have coincided with the profound financial and economic crises in the eurozone and the European Union generally, leading to repeated summits of varying kinds.
For the second time, president Van Rompuy has put a summary of his thoughts on record in an annual publication, now:
The European Council in 2011 (January 2012; 74 pages)
This is not a novelty, because the English and a few other versions were published in January.
There are, however, a few reasons for me to mention – even to recommend – the publication now.
I have now read the overview presented by Van Rompuy. His ”official” account of history in the making is an important source, regardless of how readers feel about the subject and the success this far.
The publication has now become available in 22 EU languages. (You can either toggle the language switch for the language of your choice, or proceed to the page for Council publications.)
The third reason is that you are able to find the official EUCO conclusions and the extraordinary summit statements neatly in one place for future reference.
The introduction and the conclusions are available in the same manner for the previous year, in:
The European Council in 2010 (January 2010; 45 pages; also available in 22 languages)
Ralf Grahn
speaker on EU affairs, especially digital policy and law
P.S. 1: For better or for worse, between the global issues and the national level, the European Union shapes our digital future and online freedoms. More than 900 euroblogs are aggregated by multilingual Bloggingportal.eu. Is your blog already listed among them? Are you following the debates which matter for your future?
P.S. 2: A few moments ago, the petition launched by @Avaaz for the European Parliament (and the national parliaments) to reject #ACTA had already been signed by 2,377,656 netizens, but more are welcome until the official funeral of the anti-piracy treaty.
The first two years of the European Council have coincided with the profound financial and economic crises in the eurozone and the European Union generally, leading to repeated summits of varying kinds.
For the second time, president Van Rompuy has put a summary of his thoughts on record in an annual publication, now:
The European Council in 2011 (January 2012; 74 pages)
This is not a novelty, because the English and a few other versions were published in January.
There are, however, a few reasons for me to mention – even to recommend – the publication now.
I have now read the overview presented by Van Rompuy. His ”official” account of history in the making is an important source, regardless of how readers feel about the subject and the success this far.
The publication has now become available in 22 EU languages. (You can either toggle the language switch for the language of your choice, or proceed to the page for Council publications.)
The third reason is that you are able to find the official EUCO conclusions and the extraordinary summit statements neatly in one place for future reference.
The introduction and the conclusions are available in the same manner for the previous year, in:
The European Council in 2010 (January 2010; 45 pages; also available in 22 languages)
Ralf Grahn
speaker on EU affairs, especially digital policy and law
P.S. 1: For better or for worse, between the global issues and the national level, the European Union shapes our digital future and online freedoms. More than 900 euroblogs are aggregated by multilingual Bloggingportal.eu. Is your blog already listed among them? Are you following the debates which matter for your future?
P.S. 2: A few moments ago, the petition launched by @Avaaz for the European Parliament (and the national parliaments) to reject #ACTA had already been signed by 2,377,656 netizens, but more are welcome until the official funeral of the anti-piracy treaty.
Wednesday, 9 November 2011
Eurozone crisis: laughing or crying?
Who is leading the fight against the crisis in the eurozone? Who is at the root of the problems? The so called market forces, the individual EU member states, Angela Merkel and Nicolas Sarkozy who have claimed leadership, the Frankfurt group, the Euro Group (17) and chairman Jean-Claude Juncker, the euro summits (17) and president Herman Van Rompuy, the Ecofin Council (all 27 member states) and the Council presidency (Poland), the European Council (27) and president Herman Van Rompuy, the European Central Bank and president Mario Draghi, the European Commission through president José Manuel Barroso and Ecfin commissioner Olli Rehn, the G20 and its members, or the IMF?
Despite Bruno Waterfield's - @BrunoBrussels on Twitter – sober explanation about the euro 'deviants' being the ten euro outsiders, I could not resist the temptation to quip:
Perhaps laughter is the best antidote to crying, so I am grateful to Anne Christensen - @AnneCbxl – for this tweet:
The tweet links to an Olympic YouTube video 'explaining' the crisis in Greece:
Gods and Greek economy
@TheEconomist offered KAL's inspired cartoon on Greece: It's just that there are so many strings attached.
***
A little easier, now, to continue listening to the cacophony (Greek origins) of official voices.
Ralf Grahn
Despite Bruno Waterfield's - @BrunoBrussels on Twitter – sober explanation about the euro 'deviants' being the ten euro outsiders, I could not resist the temptation to quip:
So kinky currencies on one hand, S&M #euro on the other?
Perhaps laughter is the best antidote to crying, so I am grateful to Anne Christensen - @AnneCbxl – for this tweet:
A truly divine solution to the Greek debt crisis. Thanks to Kostas for making us smile!
The tweet links to an Olympic YouTube video 'explaining' the crisis in Greece:
Gods and Greek economy
@TheEconomist offered KAL's inspired cartoon on Greece: It's just that there are so many strings attached.
***
A little easier, now, to continue listening to the cacophony (Greek origins) of official voices.
Ralf Grahn
Sunday, 6 November 2011
Eurozone Monday: Follow-up to October EU summits
I presume that the finance ministers meeting in the Euro Group and Ecofin 7-8 November 2011 already have these additions to the Council background note in their files. Perhaps others would like to be spared the tedious search.
Follow-up to October meetings
For a deeper view on the main text of the background note (page 2) and the Annex (page 6) on the strategy employed to counter the crisis in the eurozone, you can consult the following recent Ecofin, Euro Group, European Council and eurozone summit documents:
Council confirms agreement on economic governance; Luxembourg, 4 October 2011 (14998/11; 5 pages), i.e. six-pack highlights
Communiqué by the Eurogroup on the Greek Economic Adjustment Programme; 21 October 2011 (1 page), with green light for the next tranche of aid, pending IMF approval, based on the Troika assessment under the first rescue programme for Greece; second rescue package being prepared
Extraordinary Council meeting Economic and Financial Affairs; Brussels, 22 October 2011 (15893/11; 8 pages), preparation of European Council, but conclusions devoid of substance
European Council 23 October 2011 conclusions (EUCO 52/11; 12 pages), with growth priorities including the Single Market Act, full implementation of the Services Directive, request for a roadmap for a fully integrated Digital Single Market, reduction of the administrative burden for businesses (Smart Regulation), putting into practice recommendations on budgetary policies and structural reform; energy, including energy efficiency, as well as research and innovation; y increase cofinancing rates and better targeting for EU funds; implementation of the new framework for economic governance and a strengthened role for commissioner Olli Rehn; an ambitioius second round for the European semester; stronger financial regulation at the EU and the global level; preparation of eurozone summits 23 and 26 October with Herman Van Rompuy designated president of eurozone summits, his report having been postponed to December; assertive external trade policy, based on bilateral and regional agreements with strategic partners; promoting economic ties with neighbourhood; promoting trade policy issues. The conclusions also dealt with G20 preparations, climate change and foreign policy, before a statement on the cessation of ETA's terrorist activities.
Statement of EU heads of state or government; Brussels, 26 October 2011 (3 pages), when the national leaders of all 27 EU member states were informed about the euro summit later in the day. They agreed to a text on the banking package, as part of the whole set of eurozone measures.
Euro summit statement; 26 October 2011 (15 pages), reiterated steps taken and outlined the second rescue package to Greece including haircuts of 50%, leverage for the EFSF, bank recapitalisation and funding, antional measures in addition to the six-pack, the European Semester and the Euro Plus Pact, possible Treaty changes. The eurozone summit also announced (Annex 1) ten measures to improve the governance of the euro area (many of the Franco-German proposals endorsed). Consensus on the banking package in Annex 2.
Ralf Grahn
Follow-up to October meetings
For a deeper view on the main text of the background note (page 2) and the Annex (page 6) on the strategy employed to counter the crisis in the eurozone, you can consult the following recent Ecofin, Euro Group, European Council and eurozone summit documents:
Council confirms agreement on economic governance; Luxembourg, 4 October 2011 (14998/11; 5 pages), i.e. six-pack highlights
Communiqué by the Eurogroup on the Greek Economic Adjustment Programme; 21 October 2011 (1 page), with green light for the next tranche of aid, pending IMF approval, based on the Troika assessment under the first rescue programme for Greece; second rescue package being prepared
Extraordinary Council meeting Economic and Financial Affairs; Brussels, 22 October 2011 (15893/11; 8 pages), preparation of European Council, but conclusions devoid of substance
European Council 23 October 2011 conclusions (EUCO 52/11; 12 pages), with growth priorities including the Single Market Act, full implementation of the Services Directive, request for a roadmap for a fully integrated Digital Single Market, reduction of the administrative burden for businesses (Smart Regulation), putting into practice recommendations on budgetary policies and structural reform; energy, including energy efficiency, as well as research and innovation; y increase cofinancing rates and better targeting for EU funds; implementation of the new framework for economic governance and a strengthened role for commissioner Olli Rehn; an ambitioius second round for the European semester; stronger financial regulation at the EU and the global level; preparation of eurozone summits 23 and 26 October with Herman Van Rompuy designated president of eurozone summits, his report having been postponed to December; assertive external trade policy, based on bilateral and regional agreements with strategic partners; promoting economic ties with neighbourhood; promoting trade policy issues. The conclusions also dealt with G20 preparations, climate change and foreign policy, before a statement on the cessation of ETA's terrorist activities.
Statement of EU heads of state or government; Brussels, 26 October 2011 (3 pages), when the national leaders of all 27 EU member states were informed about the euro summit later in the day. They agreed to a text on the banking package, as part of the whole set of eurozone measures.
Euro summit statement; 26 October 2011 (15 pages), reiterated steps taken and outlined the second rescue package to Greece including haircuts of 50%, leverage for the EFSF, bank recapitalisation and funding, antional measures in addition to the six-pack, the European Semester and the Euro Plus Pact, possible Treaty changes. The eurozone summit also announced (Annex 1) ten measures to improve the governance of the euro area (many of the Franco-German proposals endorsed). Consensus on the banking package in Annex 2.
Ralf Grahn
Sunday, 18 September 2011
End of eurozone or beginning of democracy?
Our knowledgeable guides take us on a tour of the hospice of the eurozone.
Europe-27etc
There is not a minute to spare, if we want to avoid a disaster worse than the Lehman collapse, says Europe-27etc: Madame la Chancelière, Monsieur le Président, n'ayez pas peur !
Chancellor Merkel, president Sarkozy and the rest of the leaders need to give the common euro currency the common government it needs:
Credibility requires a real representative democracy at federal level:
Liana Giorgi
Running around like Headless Chickens, is the blog post where Liana Giorgi describes the German enterprise minister Philipp Rösler's (FDP) anti-European, anti-democratic and anti-federalism op-ed as unintelligent and populist. Something different is needed:
FT nightmare scenario
The Financial Times earnestly discusses the nightmare scenario for the eurozone.
Business Insider and VoA on Greece
Something went wrong. After Geithner Strikes Out In Poland, Papandreou Cancels U.S. Trip And Hurries To Greece, says Business Insider.
At least this remains suspended. Voice of America tells us that EU Finance Ministers Delay Aid Decision.
Summing up
This how the Voice of America summed up two days of ministerial meetings in Wroclaw, Poland: EU Finance Ministers Fail to Agree on New Debt Measures.
The British chancellor George Osborne offered some advice from the outside of the eurozone:
Ralf Grahn
Europe-27etc
There is not a minute to spare, if we want to avoid a disaster worse than the Lehman collapse, says Europe-27etc: Madame la Chancelière, Monsieur le Président, n'ayez pas peur !
Chancellor Merkel, president Sarkozy and the rest of the leaders need to give the common euro currency the common government it needs:
C’est donc une question de gouvernement : parce qu’elle a une monnaie unique, la zone euro doit se donner un gouvernement fédéral.
Credibility requires a real representative democracy at federal level:
Seule l’alternance dans un cadre constitutionnel fédéral peut guérir nos maux, rendre à la démocratie représentative ses lettres de noblesse, offrir aux Européens, dans l’unité, le choix entre des politiques immobilistes et des politiques innovatrices, efficaces et donc crédibles aux yeux du monde entier.
Liana Giorgi
Running around like Headless Chickens, is the blog post where Liana Giorgi describes the German enterprise minister Philipp Rösler's (FDP) anti-European, anti-democratic and anti-federalism op-ed as unintelligent and populist. Something different is needed:
Coming up and diffusing negative sound bites is easier than relying upon and diffusing expert knowledge—but this is no excuse for giving into the former temptation.
FT nightmare scenario
The Financial Times earnestly discusses the nightmare scenario for the eurozone.
Business Insider and VoA on Greece
Something went wrong. After Geithner Strikes Out In Poland, Papandreou Cancels U.S. Trip And Hurries To Greece, says Business Insider.
At least this remains suspended. Voice of America tells us that EU Finance Ministers Delay Aid Decision.
Summing up
This how the Voice of America summed up two days of ministerial meetings in Wroclaw, Poland: EU Finance Ministers Fail to Agree on New Debt Measures.
The British chancellor George Osborne offered some advice from the outside of the eurozone:
I think everyone here understands the severity of the situation... People know that time is running out. The eurozone needs to know it needs a grip on the situation.
Ralf Grahn
Saturday, 17 September 2011
Eurozone blues
Who is going to be the Herostratus of the eurozone? Many are in the running if we try to follow events.
In the column Public debt in the Eurozone, Japan, and the US, professor Charles Wyplosz presented a report about the ease of accumulating excessive public debt and the difficulties in getting rid of it.
In the Financial Times, Martin Wolf wrote that the failure of Germany's leaders to explain the basic facts (deficiencies) of the eurozone makes it impossible to solve the current crisis. Germany must make the choice between a different eurozone or no eurozone. In the meantime, the ECB should act to prevent meltdown: Time for Germany to make its fateful choice.
At the US Council on Foreign Relations (CFR), Christopher Alessi presented the downgrading of French banks, their share prices being hit, the upcoming trip by US Treasury secretary Timothy Geithner to meet the eurozone finance ministers, worries about European banks generally and the probable lack of coordinated global responses, different views from both shores of the Atlantic and discordant views within the German coalition government. A banking crisis was close, according to some observers. The article offers helpful links to the stories: The Gathering Eurozone Storm.
Professor Hans-Joachim Voth wrote an overview of the European cacaphony for CNN, reminding readers that a rescue in exchange for collateral is not much of a rescue at all. In addition to Finland, other smaller eurozone countries are getting restless and disillusioned: Will the Austrians, Slovaks or Dutch break the euro?
Saturday evening eurozone blues for you.
Ralf Grahn
In the column Public debt in the Eurozone, Japan, and the US, professor Charles Wyplosz presented a report about the ease of accumulating excessive public debt and the difficulties in getting rid of it.
In the Financial Times, Martin Wolf wrote that the failure of Germany's leaders to explain the basic facts (deficiencies) of the eurozone makes it impossible to solve the current crisis. Germany must make the choice between a different eurozone or no eurozone. In the meantime, the ECB should act to prevent meltdown: Time for Germany to make its fateful choice.
At the US Council on Foreign Relations (CFR), Christopher Alessi presented the downgrading of French banks, their share prices being hit, the upcoming trip by US Treasury secretary Timothy Geithner to meet the eurozone finance ministers, worries about European banks generally and the probable lack of coordinated global responses, different views from both shores of the Atlantic and discordant views within the German coalition government. A banking crisis was close, according to some observers. The article offers helpful links to the stories: The Gathering Eurozone Storm.
Professor Hans-Joachim Voth wrote an overview of the European cacaphony for CNN, reminding readers that a rescue in exchange for collateral is not much of a rescue at all. In addition to Finland, other smaller eurozone countries are getting restless and disillusioned: Will the Austrians, Slovaks or Dutch break the euro?
Saturday evening eurozone blues for you.
Ralf Grahn
Friday, 26 August 2011
Eurozone: Citizens concerned
If the national governments want something better than the impending crash, why don't they get to grips with the issues of democratic empowerment and sufficient powers at European level?
This is where we stand today: Eurozone: A matter of common concern, a real concern for citizens and businesses alike.
According to Jacques Delors, the former president of the European Commission, the euro and Europe are on the brink of the abyss. Notre Europe has collected the interviews and media reactions: Jacques Delors face à la crise de l'euro.
In Le Taurillon, Nessim Znaïen highlighted some proposals by Delors in the interview published by Le Temps.
Spencer Kimball, on European Dialogue, stated that US, EU debt crisis escalates in the face of political gridlock.
The Green MEP Reinhardt Bütikofer cautiously speaks about the need for empowering the European Parliament in the management of the euro crisis.
The calculus of not saving the Euro goes beyond economics, but it is in fact a political decision, Maxime Larive wrote on the Foreign Policy Association blog.
The blog of the office of György Schöpflin MEP noted the threat of intergovernmentalism. The Franco-German plans to govern the euro are expressly designed to circumvent the Commission and the European Parliament. The pressure to reassert state-national interest over a European-level interest neglects and probably damages the EU’s conflict resolution function.
Come September, when, or rather if, the permanent bailout mechanism takes over the role of the ECB, we shall see whether these crisis measures are enough to save the euro, Finn Maigaard wrote on the Foreign Policy Association blog.
Finland insists on getting collateral for participating in the second Greek rescue package. Other eurozone governments have reacted and the markets are raising alarms, Peter Spiegel wrote on the FT Brussels blog.
The current crisis in Europe isn’t just a Greek or German or Irish or Portuguese problem, it’s a European one, Jason O'Mahony wrote.
Protesilaos Stavrou wrote that if things stay as they are then we will reach a dead end that will signal the start of the collapse of the euro and of everything that took decades to build. The blog post offers practical proposals on remedies for the systemic crisis.
The European Central Bank is forced to act as a fire department, because chancellor Merkel postpones the saving of the euro. After months of silence, the German president Christian Wulff finds nothing better to say than to criticise the independent ECB, Eric Bonse wrote on Lost in Europe (in German).
Laurence Boon, on Telos, explains that eurobonds are no miracle cure, but they could be a help on certain conditions.
Megan Green reasons that Eurobonds could work, but we'll probably never know. Throughout the euro crisis, EU leaders have repeatedly demonstrated that their top priority is their own national self-interest, despite the huge potential downside risks this poses to the common currency.
Although the European Union is formally a democracy, it does not act like one. We're in the middle of a massive crisis, but when it comes to the solutions, we are talking about national solutions to European problems, wrote The European Citizen.
***
If the national governments want something better, why don't they discuss politically legitimate government and sufficient solutions to European problems?
The new articles on 841 euroblogs are just one click away. Follow and participate in the discussion about the eurozone and other European issues on multilingual Bloggingportal.eu, an important part of the European public space.
Ralf Grahn
This is where we stand today: Eurozone: A matter of common concern, a real concern for citizens and businesses alike.
According to Jacques Delors, the former president of the European Commission, the euro and Europe are on the brink of the abyss. Notre Europe has collected the interviews and media reactions: Jacques Delors face à la crise de l'euro.
In Le Taurillon, Nessim Znaïen highlighted some proposals by Delors in the interview published by Le Temps.
Spencer Kimball, on European Dialogue, stated that US, EU debt crisis escalates in the face of political gridlock.
The Green MEP Reinhardt Bütikofer cautiously speaks about the need for empowering the European Parliament in the management of the euro crisis.
The calculus of not saving the Euro goes beyond economics, but it is in fact a political decision, Maxime Larive wrote on the Foreign Policy Association blog.
The blog of the office of György Schöpflin MEP noted the threat of intergovernmentalism. The Franco-German plans to govern the euro are expressly designed to circumvent the Commission and the European Parliament. The pressure to reassert state-national interest over a European-level interest neglects and probably damages the EU’s conflict resolution function.
Come September, when, or rather if, the permanent bailout mechanism takes over the role of the ECB, we shall see whether these crisis measures are enough to save the euro, Finn Maigaard wrote on the Foreign Policy Association blog.
Finland insists on getting collateral for participating in the second Greek rescue package. Other eurozone governments have reacted and the markets are raising alarms, Peter Spiegel wrote on the FT Brussels blog.
The current crisis in Europe isn’t just a Greek or German or Irish or Portuguese problem, it’s a European one, Jason O'Mahony wrote.
Protesilaos Stavrou wrote that if things stay as they are then we will reach a dead end that will signal the start of the collapse of the euro and of everything that took decades to build. The blog post offers practical proposals on remedies for the systemic crisis.
The European Central Bank is forced to act as a fire department, because chancellor Merkel postpones the saving of the euro. After months of silence, the German president Christian Wulff finds nothing better to say than to criticise the independent ECB, Eric Bonse wrote on Lost in Europe (in German).
Laurence Boon, on Telos, explains that eurobonds are no miracle cure, but they could be a help on certain conditions.
Megan Green reasons that Eurobonds could work, but we'll probably never know. Throughout the euro crisis, EU leaders have repeatedly demonstrated that their top priority is their own national self-interest, despite the huge potential downside risks this poses to the common currency.
Although the European Union is formally a democracy, it does not act like one. We're in the middle of a massive crisis, but when it comes to the solutions, we are talking about national solutions to European problems, wrote The European Citizen.
***
If the national governments want something better, why don't they discuss politically legitimate government and sufficient solutions to European problems?
The new articles on 841 euroblogs are just one click away. Follow and participate in the discussion about the eurozone and other European issues on multilingual Bloggingportal.eu, an important part of the European public space.
Ralf Grahn
Friday, 5 August 2011
Barroso calls for end to eurozone contagion
When the eurozone is marching towards more sustainable deficits, why did the bond markets suddenly pounce on Cyprus, Italy and Spain?
Their public deficits are far from new. The structural weaknesses and the resulting lack of competitiveness of these Mediterranean countries are notorius – and age old old problems they will ultimately have to confront and overcome.
The twin tracks of the Stability and Growth Pact and the Europe 2020 strategy are as true as ever.
After the competitiveness theme, with the Wealth of Nations roundup and Growth and competitiveness: California vs Europe as the latest contributions, I wanted to take a peek at the latest patients destined for compulsory care by the financial markets.
My musings started a series about Cyprus, Italy and Spain in the eurozone crisis (in Swedish, but with a number of links to materials available in English).
Grahnblawg: Turbulens trots minskande budgetunderskott i Europa (3 August 2011)
Grahnlaw Suomi Finland: Euroakuten: Cypern, Italien och Spanien (3 August 2011)
Grahnblawg: Euroområdet: Kortsiktig nervositet och långsiktiga reformer (4 August 2011)
Grahnlaw Suomi Finland: Ledare och bloggar om eurokrisen (4 August 2011)
Eurozone summit
In the background we have the eurozone crisis summit, with its conclusions on the agreed measures for Greece (including private sector involvement), extended powers for the EfSF and the ESM, lower rates for Ireland and Portugal, commitment to fiscal and growth targets etc:
Statement by the Heads of State or Government of the Euro Area and EU institutions; 21 July 2011 (4 pages)
Some may prefer a more journalistic approach. Spiegel Online explained the main decisions of the eurozone summit: What Was Decided at the Euro-Zone Crisis Summit (25 July 2011).
Barroso goes public
Yesterday brought some additions to the emerging picture. Commission president José Manuel Barroso published his letter to the heads of state or government. Despite the economic and budgetary fundamentals, Barroso explicitly mentioned the bond markets of Italy and Spain (as well as other euro area states) as ”a cause of deep concern” for the euro area as a whole.
Barroso called for the speedy and unconditional approval of the decisions of the eurozone summit 21 July 2011, but he also saw the need for further action to stem contagion. Barroso publicly proposed a reassessment of the beefed up European Financial Stability Facility EFSF and the the new European Stability Mechanism ESM:
Media
Andrew Rettman on EUobserver noted that the Barroso letter was more outspoken than his earlier press statement. The article analysed the text of the letter and added comments by the Commission spokesperson: Barroso raises alarm about severity of euro crisis (4 August 2011).
EurActiv draws a background picture, with references and links to messages from various European capitals: Barroso asks leaders to stand firm on pledges (4 August 2011).
Ivan Delibasic contributed with another background in New Europe: It's all 'bear' and no 'bull' for Spain and Italy (4 August 2011).
In the European Voice, Simon Taylor offers an account of the Barroso letter: Barroso warns of eurozone crisis spreading (4 August 2011).
Deutsche Welle reported both German disapproval of Barroso's ideas and the downward spiral on bond and equity markets (in German): Barroso befürchtet Ausbreitung der Euro-Krise (4 August 2011.
On the FT Brussels blog, Joshua Chaffin discussed the vicissitudes of politics in Cyprus against the backdrop of the eurozone crisis: How will Cyprus restore its finances? (4 August 2011).
***
To grow commensurate to the tasks, the European Union (eurozone) needs to become more effective, which in turn requires a union based on the sovereignty of its citizens.
Ralf Grahn
P.S. Great resource: For quality articles and wise comment from the European press, you can follow Presseurop in any of ten available languages.
Their public deficits are far from new. The structural weaknesses and the resulting lack of competitiveness of these Mediterranean countries are notorius – and age old old problems they will ultimately have to confront and overcome.
The twin tracks of the Stability and Growth Pact and the Europe 2020 strategy are as true as ever.
After the competitiveness theme, with the Wealth of Nations roundup and Growth and competitiveness: California vs Europe as the latest contributions, I wanted to take a peek at the latest patients destined for compulsory care by the financial markets.
My musings started a series about Cyprus, Italy and Spain in the eurozone crisis (in Swedish, but with a number of links to materials available in English).
Grahnblawg: Turbulens trots minskande budgetunderskott i Europa (3 August 2011)
Grahnlaw Suomi Finland: Euroakuten: Cypern, Italien och Spanien (3 August 2011)
Grahnblawg: Euroområdet: Kortsiktig nervositet och långsiktiga reformer (4 August 2011)
Grahnlaw Suomi Finland: Ledare och bloggar om eurokrisen (4 August 2011)
Eurozone summit
In the background we have the eurozone crisis summit, with its conclusions on the agreed measures for Greece (including private sector involvement), extended powers for the EfSF and the ESM, lower rates for Ireland and Portugal, commitment to fiscal and growth targets etc:
Statement by the Heads of State or Government of the Euro Area and EU institutions; 21 July 2011 (4 pages)
Some may prefer a more journalistic approach. Spiegel Online explained the main decisions of the eurozone summit: What Was Decided at the Euro-Zone Crisis Summit (25 July 2011).
Barroso goes public
Yesterday brought some additions to the emerging picture. Commission president José Manuel Barroso published his letter to the heads of state or government. Despite the economic and budgetary fundamentals, Barroso explicitly mentioned the bond markets of Italy and Spain (as well as other euro area states) as ”a cause of deep concern” for the euro area as a whole.
Barroso called for the speedy and unconditional approval of the decisions of the eurozone summit 21 July 2011, but he also saw the need for further action to stem contagion. Barroso publicly proposed a reassessment of the beefed up European Financial Stability Facility EFSF and the the new European Stability Mechanism ESM:
Whatever the factors behind the lack of success, it is clear that we are no longer managing a crisis just in the euro-area periphery. Euro-area financial stability must be safeguarded, with all EU institutions playing their part with the full backing of euro area Member States. We need also to consider how to further improve the effectiveness of both the EFSF and the ESM in order to address the current contagion.
Concretely, I would like to call on you to accelerate the approval procedures for the implementation of these decisions so as to make the EFSF enhancements operational very soon. These changes should also avoid introducing excessive constraints in terms of either additional conditionality or collateralisation of EFSF lending. I trust that governments and national Parliaments will rapidly approve these decisions necessary to improve the EFSF flexibility.
I also take the opportunity to urge a rapid re-assessment of all elements related to the EFSF, and concomitantly the ESM, in order to ensure that they are equipped with the means for dealing with contagious risk.
Media
Andrew Rettman on EUobserver noted that the Barroso letter was more outspoken than his earlier press statement. The article analysed the text of the letter and added comments by the Commission spokesperson: Barroso raises alarm about severity of euro crisis (4 August 2011).
EurActiv draws a background picture, with references and links to messages from various European capitals: Barroso asks leaders to stand firm on pledges (4 August 2011).
Ivan Delibasic contributed with another background in New Europe: It's all 'bear' and no 'bull' for Spain and Italy (4 August 2011).
In the European Voice, Simon Taylor offers an account of the Barroso letter: Barroso warns of eurozone crisis spreading (4 August 2011).
Deutsche Welle reported both German disapproval of Barroso's ideas and the downward spiral on bond and equity markets (in German): Barroso befürchtet Ausbreitung der Euro-Krise (4 August 2011.
On the FT Brussels blog, Joshua Chaffin discussed the vicissitudes of politics in Cyprus against the backdrop of the eurozone crisis: How will Cyprus restore its finances? (4 August 2011).
***
To grow commensurate to the tasks, the European Union (eurozone) needs to become more effective, which in turn requires a union based on the sovereignty of its citizens.
Ralf Grahn
P.S. Great resource: For quality articles and wise comment from the European press, you can follow Presseurop in any of ten available languages.
Friday, 7 January 2011
Brussels E.C?
As Arthur Beesley tells us in the Irish Times about the country which still a few days ago had a driving role in the process of European integration, ”Belgian political stalemate continues as Flemish parties reject compromise”:
Little by little I start wondering if the European Union should acquire Brussels with surroundings and make it the European Capital (E.C.), administered as an EU territory with 23 official languages.
The non-discussions between the linguistic communities and regions of Belgium could then be limited to the rest of the country and the ”negotiations” could continue until the state falls apart from exhaustion.
Le Taurillon
Even on a more serious note, these questions are now more widely discussed. There are three recent articles worth mentioning, with viewpoints on both Belgium and Europe, in the eurozine Le Taurillon. The writers discuss Belgian as well as European aspects:
Marine Cornelis: Les difficultés gouvernementales en Belgique, quelles leçons pour l'Europe (4 January 2011)
Quel rôle pour l'UE en cas de scission de la Belgique ? 1/2
Quel rôle pour l'UE en cas de scission de la Belgique ? 2/2
Johan Vande Lanotte
The Wikipedia article ”2010-2011 Belgian government formation” follows the (non)events on the ground until two Flemish parties rejected the mediation proposal by Johan Vande Lanotte, who did not publish the proposal, so we do not know by how much the federal state would be further hollowed out even by the failed proposal.
Fallout
Bloomberg offers a picture of the background as well as of the economic fallout of the rejected proposal: Belgium's Leaders seek To Exit From Political Impasse as Bond Spreads Widen (7 January 2011)
Long term we can ask if it is possible or even reasonable to keep a couple together if one of the partners has decided to split.
Ralf Grahn
P.S. Strasbourg Observers is the legal blog team of five researchers led by Professor Eva Brems at the Human Rights Centre of Ghent University. Events these last days have shown why human and fundamental rights need constant strengthening in Europe. Here is the mission statement: Blog commenting on developments in the case-law of the European Court of Human Rights.
THE TWO largest Dutch-speaking parties in Belgium have rejected new compromise proposals to broker a power-sharing deal with their French-speaking counterparts, prolonging a political saga that has left the country in the control of a caretaker government for 208 days.
Little by little I start wondering if the European Union should acquire Brussels with surroundings and make it the European Capital (E.C.), administered as an EU territory with 23 official languages.
The non-discussions between the linguistic communities and regions of Belgium could then be limited to the rest of the country and the ”negotiations” could continue until the state falls apart from exhaustion.
Le Taurillon
Even on a more serious note, these questions are now more widely discussed. There are three recent articles worth mentioning, with viewpoints on both Belgium and Europe, in the eurozine Le Taurillon. The writers discuss Belgian as well as European aspects:
Marine Cornelis: Les difficultés gouvernementales en Belgique, quelles leçons pour l'Europe (4 January 2011)
Quel rôle pour l'UE en cas de scission de la Belgique ? 1/2
Quel rôle pour l'UE en cas de scission de la Belgique ? 2/2
Johan Vande Lanotte
The Wikipedia article ”2010-2011 Belgian government formation” follows the (non)events on the ground until two Flemish parties rejected the mediation proposal by Johan Vande Lanotte, who did not publish the proposal, so we do not know by how much the federal state would be further hollowed out even by the failed proposal.
Fallout
Bloomberg offers a picture of the background as well as of the economic fallout of the rejected proposal: Belgium's Leaders seek To Exit From Political Impasse as Bond Spreads Widen (7 January 2011)
Long term we can ask if it is possible or even reasonable to keep a couple together if one of the partners has decided to split.
Ralf Grahn
P.S. Strasbourg Observers is the legal blog team of five researchers led by Professor Eva Brems at the Human Rights Centre of Ghent University. Events these last days have shown why human and fundamental rights need constant strengthening in Europe. Here is the mission statement: Blog commenting on developments in the case-law of the European Court of Human Rights.
Sunday, 30 May 2010
Tracking eurozone crisis measures: Barbarians at the gate
Despite the decisions taken with regard to Greece, the battering rams of the markets were pounding the gates of the eurozone castle and sappers were undermining the walls of confidence.
Business as usual was no longer an option for the second largest currency in the world.
We have fundamental reforms to carry out and we will carry out those reforms. It is a major priority for me and for the European Council, said president Herman Van Rompuy in a statement on Greece and solidarity in the Euro Area on the eve of an extraordinary weekend (5 May 2010).
In our latest blog post we tracked the eurozone crisis measures to the activation of financial support for Greece, but now we start to turn towards the responses given to the challenges for the whole eurozone, as well.
The extraordinary meeting of the heads of state or government of the euro area 7 May 2010 issued a statement, which endorsed the implementation of the support package for Greece, described as reflecting the principles of responsibility and solidarity.
16 Musketeers
The national leaders reiterated, in their own words, the motto of the Three Musketeers “all for one, one for all”:
Consolidation and stabilisation
The heads of state or government outlined the next steps towards fiscal consolidation, endorsed the actions of the European Central Bank (ECB) and indicated the establishment of a European stabilisation mechanism during the same weekend:
In addition, the leaders of the euro area were prepared to strengthen economic governance and to make rapid progress on financial markets regulation and supervision.
Practically every timetable was accelerated, with the Europe Day ECOFIN Council called to hammer out the details.
Ralf Grahn
Business as usual was no longer an option for the second largest currency in the world.
We have fundamental reforms to carry out and we will carry out those reforms. It is a major priority for me and for the European Council, said president Herman Van Rompuy in a statement on Greece and solidarity in the Euro Area on the eve of an extraordinary weekend (5 May 2010).
In our latest blog post we tracked the eurozone crisis measures to the activation of financial support for Greece, but now we start to turn towards the responses given to the challenges for the whole eurozone, as well.
The extraordinary meeting of the heads of state or government of the euro area 7 May 2010 issued a statement, which endorsed the implementation of the support package for Greece, described as reflecting the principles of responsibility and solidarity.
16 Musketeers
The national leaders reiterated, in their own words, the motto of the Three Musketeers “all for one, one for all”:
In the current crisis, we reaffirm our commitment to ensure the stability, unity and integrity of the euro area. All the institutions of the euro area (Council, Commission, ECB) as well as all euro area Member States agree to use the full range of means available to ensure the stability of the euro area.
Consolidation and stabilisation
The heads of state or government outlined the next steps towards fiscal consolidation, endorsed the actions of the European Central Bank (ECB) and indicated the establishment of a European stabilisation mechanism during the same weekend:
Today, we agreed on the following:
- First, consolidation of public finances is a priority for all of us and we will take all measures needed to meet our fiscal targets this year and in the years ahead in line with excessive deficit procedures. Each one of us is ready, depending on the situation of his country, to take the necessary measures to accelerate consolidation and to ensure the sustainability of public finances. The situation will be reviewed by the Ecofin Council on the basis of a Commission assessment by the end of June at the latest. We have asked the Commission and the Council to strictly enforce the recommendations addressed to Member States under the Stability and Growth Pact.
- Second, we fully support the ECB in its action to ensure the stability of the euro area.
- Third, taking into account the exceptional circumstances, the Commission will propose a European stabilization mechanism to preserve financial stability in Europe. It will be submitted for decision to an extraordinary ECOFIN meeting that the Spanish presidency will convene this Sunday May 9th.
In addition, the leaders of the euro area were prepared to strengthen economic governance and to make rapid progress on financial markets regulation and supervision.
Practically every timetable was accelerated, with the Europe Day ECOFIN Council called to hammer out the details.
Ralf Grahn
Tuesday, 25 May 2010
Tracking eurozone crisis measures: Greek aid from words towards deeds
On Sunday, 11 April 2010 the finance ministers of the Euro Group held a teleconference, where they agreed to prepare the activation of support, jointly with the IMF, for Greece. Support by the eurozone countries during the first year of the three year package was set at €30 billion, in the form of conditional, interest-bearing loans.
The Euro Group statement adds some details to the principles presented 25 March 2010: Tracking eurozone crisis measures: Collective defence doctrine and foundations (24 May 2010).
Euro Group statement
Statement on the support to Greece by Euro area Members States; Brussels, 11 April 2010
Supportive statements
The official communications on 11 April 2010 included a Commission press release MEMO/10/123, a statement by the president of the European Council Herman Van Rompuy and a short supportive statement by IMF managing director Dominique Strauss-Kahn.
In the media
EurActiv: Euro zone readies 30bn euros to rescue Greece (12 April, updated 15 April 2010)
EUbusiness: ECB’s Trichet says Greek aid plan ‘positive’ (12 April 2010)
Still government by communiqués, but the eurozone statement was a clear step towards deeds to save Greece from default and the euro area from chaos.
Ralf Grahn
The Euro Group statement adds some details to the principles presented 25 March 2010: Tracking eurozone crisis measures: Collective defence doctrine and foundations (24 May 2010).
Euro Group statement
Statement on the support to Greece by Euro area Members States; Brussels, 11 April 2010
Following the statement by the Heads of State and Government of the Euro area on 25 March, Euro area Members States have agreed upon the terms of the financial support that will be given to Greece, when needed, to safeguard financial stability in the Euro area as a whole.
Euro area Members States are ready to provide financing via bilateral loans centrally pooled by the European Commission as part of a package including International Monetary Fund financing.
The Commission, in liaison with the ECB, will start working on Monday April 12th, with the International Monetary Fund and the Greek authorities on a joint programme (including amounts and conditionality, building on the recommendations adopted by the Ecofin Council in February). In parallel, Euro area Members States will engage the necessary steps, at national level, in order to be able to deliver a swift assistance to Greece.
Euro area Member States will decide the activation of the support when needed and disbursements will be decided by participating Member States.
The programme will cover a three-year period. The euro area Member States are ready to contribute for their part up to € 30 billion in the first year to cover financing needs in a joint programme to be designed with and cofinanced by the IMF. Financial support for the following years will be decided upon the agreement of the joint programme.
In order to set incentives for Greece to return to market financing, Euro area Members States loans will be granted on non-concessional interest rates. The pricing formula used by the IMF is an appropriate benchmark for setting Euro area Members States bilateral loan conditions, albeit with some adjustments. Variable-rate loans will be based on 3-month Euribor. Fixed-rate loans will be based upon the rates corresponding to Euribor swap rates for the relevant maturities. A charge of 300 basis points will be applied. A further 100 basis points are charged for amounts outstanding for more than 3 years. In conformity with IMF charges, a one-off service fee of maximum 50 basis points will be charged to cover operational costs.
For instance, as of April 9th, for a three year fixed-rate loan granted to Greece, the rate would be around 5%.
The Eurogroup is confident that the determined efforts of the Greek authorities and of its European Partners will allow to overcome the fiscal and structural challenges of the Greek economy. In this context, the Eurogroup welcomes the budget execution in the first months of the year, which shows that the measures taken so far are bearing fruit.
Supportive statements
The official communications on 11 April 2010 included a Commission press release MEMO/10/123, a statement by the president of the European Council Herman Van Rompuy and a short supportive statement by IMF managing director Dominique Strauss-Kahn.
In the media
EurActiv: Euro zone readies 30bn euros to rescue Greece (12 April, updated 15 April 2010)
EUbusiness: ECB’s Trichet says Greek aid plan ‘positive’ (12 April 2010)
Still government by communiqués, but the eurozone statement was a clear step towards deeds to save Greece from default and the euro area from chaos.
Ralf Grahn
Monday, 24 May 2010
Tracking eurozone crisis measures: Collective defence doctrine and foundations
How do the heads of state or government of the eurozone countries add to our knowledge about crisis prevention and mitigation at the time of the Spring European Council?
Statement by the heads of state and government of the euro area; Brussels, 25 March 2010
Greece
The participants stated that ‘ambitious and decisive’ action by the Greek government should allow Greece to regain the full confidence of the markets. Greece had not requested financial assistance, so no decision was taken to activate such assistance.
The euro area member states reaffirmed their willingness to safeguard stability in the euro area as a whole.
However, the eurozone member states outlined an aid package, should the market disturbances continue or deepen:
From Greece to collective defence doctrine
It is remarkable that the most significant outcomes at the Spring European Council were not brought about by the institution, but cooked up at the margins, by a gathering even more informal than the Euro Group.
The national leaders of the eurozone countries proclaimed the doctrine of ‘collective defence’ for the common currency.
They were not willing or able to take the detailed decisions on mutual aid, but they laid the foundations for lending at average rates of interest:
• Intergovernmental, decisions requiring unanimity
• By euro area member states
• Minority participation but leading role for the International Monetary Fund (IMF)
• Coordinated bilateral loans
• Conditionality
• Assessment by the European Commission and the ECB
• Country shares based on ECB capital key
• Loans bearing interest, not subsidised
• Unspecified incentives for return to market financing of sovereign debt
• National legal and budget decisions as needed
There are limits to what the EU member states or the euro area countries can do within the treaty framework. It is something of an irony that for more profound action they have to resort to classical intergovernmental cooperation.
Did the markets doubt the ability of the euro area members to walk the talk?
Did the markets distrust the Greek government’s promises, or did they bet on Greece going broke anyway (with, perhaps, a gentle push)?
Soon enough the eurozone countries were going to wake up to the fact that both the Greek economy and the euro currency itself faced an existential threat. They could give up resistance or they had to bring out the big guns.
Ralf Grahn
Statement by the heads of state and government of the euro area; Brussels, 25 March 2010
Greece
The participants stated that ‘ambitious and decisive’ action by the Greek government should allow Greece to regain the full confidence of the markets. Greece had not requested financial assistance, so no decision was taken to activate such assistance.
The euro area member states reaffirmed their willingness to safeguard stability in the euro area as a whole.
However, the eurozone member states outlined an aid package, should the market disturbances continue or deepen:
As part of a package involving substantial International Monetary Fund financing and a majority of European financing, Euro area member states, are ready to contribute to coordinated bilateral loans.
This mechanism, complementing International Monetary Fund financing, has to be considered ultima ratio, meaning in particular that market financing is insufficient. Any disbursement on the bilateral loans would be decided by the euro area member states by unanimity subject to strong conditionality and based on an assessment by the European Commission and the European Central Bank. We expect Euro-Member states to participate on the basis of their respective ECB capital key.
The objective of this mechanism will not be to provide financing at average euro area interest rates, but to set incentives to return to market financing as soon as possible by risk adequate pricing. Interest rates will be non-concessional, i.e. not contain any subsidy element. Decisions under this mechanism will be taken in full consistency with the Treaty framework and national laws.
We reaffirm our commitment to implement policies aimed at restoring strong, sustainable and stable growth in order to foster job creation and social cohesion.
Furthermore, we commit to promote a strong coordination of economic policies in Europe. We consider that the European Council must improve the economic governance of the European Union and we propose to increase its role in economic coordination and the definition of the European Union growth strategy.
The current situation demonstrates the need to strengthen and complement the existing framework to ensure fiscal sustainability in the euro zone and enhance its capacity to act in times of crises.
For the future, surveillance of economic and budgetary risks and the instruments for their prevention, including the Excessive Deficit Procedure, must be strengthened. Moreover, we need a robust framework for crisis resolution respecting the principle of member states' own budgetary responsibility.
We ask the President of the European Council to establish, in cooperation with the Commission, a task force with representatives of Member States, the rotating presidency and the ECB, to present to the Council, before the end of this year, the measures needed to reach this aim, exploring all options to reinforce the legal framework.
From Greece to collective defence doctrine
It is remarkable that the most significant outcomes at the Spring European Council were not brought about by the institution, but cooked up at the margins, by a gathering even more informal than the Euro Group.
The national leaders of the eurozone countries proclaimed the doctrine of ‘collective defence’ for the common currency.
They were not willing or able to take the detailed decisions on mutual aid, but they laid the foundations for lending at average rates of interest:
• Intergovernmental, decisions requiring unanimity
• By euro area member states
• Minority participation but leading role for the International Monetary Fund (IMF)
• Coordinated bilateral loans
• Conditionality
• Assessment by the European Commission and the ECB
• Country shares based on ECB capital key
• Loans bearing interest, not subsidised
• Unspecified incentives for return to market financing of sovereign debt
• National legal and budget decisions as needed
There are limits to what the EU member states or the euro area countries can do within the treaty framework. It is something of an irony that for more profound action they have to resort to classical intergovernmental cooperation.
Did the markets doubt the ability of the euro area members to walk the talk?
Did the markets distrust the Greek government’s promises, or did they bet on Greece going broke anyway (with, perhaps, a gentle push)?
Soon enough the eurozone countries were going to wake up to the fact that both the Greek economy and the euro currency itself faced an existential threat. They could give up resistance or they had to bring out the big guns.
Ralf Grahn
Sunday, 23 May 2010
Tracking eurozone crisis measures: Beware the ides of March
In Tracking Eurozone crisis measures: Half empty or half full? (23 May 2010) we recapitulated the official ECB and EU decisions published and sketched the road map to track the communications from the institutions and informal groups on the eurozone crisis and economic governance in a few blog posts.
Even if most of the flurry of activities has been seen in May, we have cause to see how our leaders have acted to avert the dangers.
Beware the ides of March offers a reasonable starting point for brief retrospection, although the storm had been brewing for a time.
ECOFIN 16 March 2010
3003rd Council meeting Economic and Financial Affairs, Brussels, 16 March 2010 (document 7498/10)
On the excessive deficit procedure – follow-up to the decision on Greece, ECOFIN reached the following conclusions:
Caesar: The ides of March are come.
Soothsayer: Ay, Caesar; but not gone.
(Shakespeare: Julius Caesar Act III, Scene I)
Greece was under close ECOFIN scrutiny and the Greek government had announced corrective measures, but the full force gale had not yet lifted them up to say nothing about taking them home.
Ralf Grahn
Even if most of the flurry of activities has been seen in May, we have cause to see how our leaders have acted to avert the dangers.
Beware the ides of March offers a reasonable starting point for brief retrospection, although the storm had been brewing for a time.
ECOFIN 16 March 2010
3003rd Council meeting Economic and Financial Affairs, Brussels, 16 March 2010 (document 7498/10)
On the excessive deficit procedure – follow-up to the decision on Greece, ECOFIN reached the following conclusions:
The Council examined a communication from the Commission assessing action taken by Greece in response to the decision it took on 16 February on the correction of Greece's excessive deficit.
The Council welcomed the first report by Greece, submitted on 8 March, and the Commission's communication. It shared the Commission's view that Greece is appropriately implementing the Council's decision and Greece's stability programme. It welcomed the additional measures announced by the Greek government on 3 March, amounting to 2% of gross domestic product (GDP) and consisting of permanent revenue-increasing measures and permanent expenditure cuts in equal shares. In line with the Commission's assessment, the Council considered that these additional measures appear sufficient to safeguard budgetary targets for 2010, provided that they are implemented effectively, fully and in a timely manner.
In its 16 February decision, adopted under article 126(9) of the Treaty on the Functioning of the European Union, the Council:
– gave notice to Greece to bring its government deficit below 3% of GDP, the reference value set by the EU treaty, by 2012;
– set out a timetable of measures to be taken, including a target of 8.7% of GDP for its 2010 budgetary deficit, which represents a 4 percentage points reduction from the estimated 12.7% deficit for 2009;
– set 16 March as the first of a series of deadlines for reporting on measures taken;
– stated that, to the extent that a number of risks associated with the specified deficit and debt ceilings materialise, Greece would announce, in its first report, additional measures to ensure that the 2010 budgetary target is met.
Greece has been subject to an excessive deficit procedure since April 2009.
Caesar: The ides of March are come.
Soothsayer: Ay, Caesar; but not gone.
(Shakespeare: Julius Caesar Act III, Scene I)
Greece was under close ECOFIN scrutiny and the Greek government had announced corrective measures, but the full force gale had not yet lifted them up to say nothing about taking them home.
Ralf Grahn
Saturday, 22 May 2010
Herman Van Rompuy on task force meeting to improve EU economic governance
The European Union (eurozone) and the International Monetary Fund have pledged €110 billion to rescue Greece and up to €750 billion for other contingencies with regard to euro stabilisation. Markets have continued to tumble.
It would have been astonishing if the EU finance ministers had approached the meeting of the task force on improved economic governance without a sense of urgency.
Initiated by the European Council and chaired by its president Herman Van Rompuy, the task force on crisis resolution and better budget discipline held its exploratory first meeting in Brussels yesterday, 21 May 2010.
Given the urgency and gravity of the issues, we have reasons to read the statement of Van Rompuy carefully and in full:
Remarks by Herman Van Rompuy, President of the European Council, following the first meeting of the Task force on economic governance (21 May 2010)
Not a bad start for the Van Rompuy task force, but the challenges are huge for our economic security and future prosperity.
Ralf Grahn
It would have been astonishing if the EU finance ministers had approached the meeting of the task force on improved economic governance without a sense of urgency.
Initiated by the European Council and chaired by its president Herman Van Rompuy, the task force on crisis resolution and better budget discipline held its exploratory first meeting in Brussels yesterday, 21 May 2010.
Given the urgency and gravity of the issues, we have reasons to read the statement of Van Rompuy carefully and in full:
Remarks by Herman Van Rompuy, President of the European Council, following the first meeting of the Task force on economic governance (21 May 2010)
Today we had the first meeting of the Task Force on economic governance. It was a very useful meeting. I could feel a sense of urgency and a spirit of cooperation around the table. Everyone shares the will to go forward together.
As you probably know, the Task Force consists of representatives of all 27 Member States – mostly Ministers of Finance -, plus Commissioner Rehn from the Commission, President Trichet from the European Central Bank, Prime-minister Juncker from the Eurogroup and myself as chairman. All key actors are around the table.
Today was the start of a process. We did more than just identify the issues on the table. We have already found agreement on the four main objectives and also on the direction in which we will move forward for each of them.
I consider this as an important step upon which we can build in the forthcoming meetings.
Now, which are the four main objectives on which everybody agreed?
First objective: We should achieve greater budgetary discipline. In other words, we need to strengthen the Stability and Growth Pact and make it more effective.
Second objective: We need to find means to reduce the divergences in competitiveness between the Member States, at least when these divergences are too big. This is necessary to reach a more even economic development within the European Union, and in particular, in the euro area.
Third objective: We need to have an effective crisis mechanism in order to be able to deal with problems such as those we see today in the Eurozone.
The fourth objective is linked to the third: We need to strengthen economic governance, in institutional terms, in order to be able to act quicker and in a more coordinated and more efficient manner.
These are the four central priorities on which we will move forward.
The Commission contributed with an important Communication which contained a number of proposals. I, personally, have put some thinking points on the table as too have some Member States. Undoubtedly other Member States will follow suit with their proposals before the end of May. I welcome this active participation in our collective work very much.
On the basis of all this we will work on a comprehensive agreement. The Task Force we will meet twice more before the summer. Preparatory work will be done by a group of 'Sherpa's'. We will present a "Progress Report" to the European Council of 17 June. What do we aim for?
Our agreement should result in a stronger economic cohesion within the Union. This is vital for 27 countries with a common internal market and for a zone of 16 countries sharing a single currency.
Moreover, such cohesion is required in order to act in an effective and credible manner. The approach should be seen in the context of our considerable efforts to strengthen the structural economic growth within the Union, such as we are doing with the EU 2020 strategy.
A final point: we all want to draw the lessons from this difficult period. In the past, corrective measures were taken too late; the available legal instruments were not used sufficiently. That's why we need to act in a number of ways:
• in prevention and in correction;
• in the fields of the budget and of competitiveness;
• in the eurozone and in the European Union as a whole.
All Member States and all EU institutions need to work together on this.
I am deeply convinced that we can surmount this crisis. The measures we have taken for Greece (on 2 May) and in a broader framework (on 7 and 9 May) have proven that the European Union is able to act. We must now continue this work so we can avoid a repetition of these problems in the future.
Therefore, as I said previously, I am very glad that all members of the Task Force share the will to bring this about.
We are still planning to have our work ready before the European Council of October, instead of December.
Not a bad start for the Van Rompuy task force, but the challenges are huge for our economic security and future prosperity.
Ralf Grahn
Friday, 21 May 2010
Eurozone crisis: ECB decisions
The European Central Bank (ECB) has published a convenient press release on monetary policy decisions relating to the eurozone crisis: Decisions taken by the Governing Council of the ECB (in addition to decisions setting interest rates), Friday 21 May 2010.
We have presented the ECB decisions published in the Official Journal of the European Union on this blog.
Besides the summary of decisions, the press release contains links to press releases and formal decisions, including:
• ECB assesses the Greek economic and financial adjustment programme (2 May 2010)
• ECB announces change in eligibility of debt instruments issued or guaranteed by the Greek government (3 May 2010)
• Decision ECB/2010/3 of the ECB of 6 May 2010 on temporary measures relating to the eligibility of marketable debt instruments issued or guaranteed by the Greek Government
• ECB decides on measures to address severe tensions in financial markets (10 May 2010)
• Decision ECB/2010/5 of the ECB of 14 May 2010 establishing a securities markets programme
• Reactivation of US dollar liquidity providing operations (10 May 2010)
• ECB announces details regarding the reactivation of the US dollar liquidity-providing operations (10 May 2010)
• Decision ECB/2010/4 of the ECB of 10 May 2010 concerning the management of pooled bilateral loans for the benefit of the Hellenic Republic and amending Decision ECB/2007/7
Ralf Grahn
We have presented the ECB decisions published in the Official Journal of the European Union on this blog.
Besides the summary of decisions, the press release contains links to press releases and formal decisions, including:
• ECB assesses the Greek economic and financial adjustment programme (2 May 2010)
• ECB announces change in eligibility of debt instruments issued or guaranteed by the Greek government (3 May 2010)
• Decision ECB/2010/3 of the ECB of 6 May 2010 on temporary measures relating to the eligibility of marketable debt instruments issued or guaranteed by the Greek Government
• ECB decides on measures to address severe tensions in financial markets (10 May 2010)
• Decision ECB/2010/5 of the ECB of 14 May 2010 establishing a securities markets programme
• Reactivation of US dollar liquidity providing operations (10 May 2010)
• ECB announces details regarding the reactivation of the US dollar liquidity-providing operations (10 May 2010)
• Decision ECB/2010/4 of the ECB of 10 May 2010 concerning the management of pooled bilateral loans for the benefit of the Hellenic Republic and amending Decision ECB/2007/7
Ralf Grahn
Thursday, 20 May 2010
Eurozone crisis: ECB rating the raters
The leadership of the European Central Bank has presented views on a number of aspects of the eurozone crisis in public.
ECB executive board member Lorenzo Bini Smaghi reflected on the third phase of the eurozone crisis in a speech called Lessons of the crisis: Ethics, Markets, Democracy (13 May 2010).
Bini Smaghi discussed the feelings of taxpayers versus the consequences of non-intervention with regard to US examples and the case of Greece.
Quick response mechanisms are needed to fend off speculative attacks undermining the solidity of states, but the speaker admitted that it is hard to see how they can be made compatible with parliamentary scrutiny of the use of taxpayers’ money.
Bini Smaghi made a number of observations about market participants and herd behaviour, as well as the role of market information. He discussed the decision by the ECB to disregard the rating agencies in the case of Greek sovereign debt, the role of expert commentators with conflicts of interest and the influence of lobbyists on regulation and opinion making.
The issues are hardly surprising, but serve as a reminder when you listen to the next cocksure commentator and especially before you invest your money (or someone else’s).
Ralf Grahn
ECB executive board member Lorenzo Bini Smaghi reflected on the third phase of the eurozone crisis in a speech called Lessons of the crisis: Ethics, Markets, Democracy (13 May 2010).
Bini Smaghi discussed the feelings of taxpayers versus the consequences of non-intervention with regard to US examples and the case of Greece.
Quick response mechanisms are needed to fend off speculative attacks undermining the solidity of states, but the speaker admitted that it is hard to see how they can be made compatible with parliamentary scrutiny of the use of taxpayers’ money.
Bini Smaghi made a number of observations about market participants and herd behaviour, as well as the role of market information. He discussed the decision by the ECB to disregard the rating agencies in the case of Greek sovereign debt, the role of expert commentators with conflicts of interest and the influence of lobbyists on regulation and opinion making.
The issues are hardly surprising, but serve as a reminder when you listen to the next cocksure commentator and especially before you invest your money (or someone else’s).
Ralf Grahn
Eurozone crisis: Interventions by Eurosystem central banks
The Decision by the European Central Bank ECB/2010/5 to allow outright interventions by Eurosystem central banks in the euro area public and private debt securities markets has been published in the Official Journal of the European Union:
DECISION OF THE EUROPEAN CENTRAL BANK of 14 May 2010 establishing a securities markets programme (ECB/2010/5) (2010/281/EU); published OJEU 20.5.2010 L 124/8.
Naturally, this decision and much else can be found on the well organised web pages of the ECB.
Ralf Grahn
DECISION OF THE EUROPEAN CENTRAL BANK of 14 May 2010 establishing a securities markets programme (ECB/2010/5) (2010/281/EU); published OJEU 20.5.2010 L 124/8.
Naturally, this decision and much else can be found on the well organised web pages of the ECB.
Ralf Grahn
Wednesday, 19 May 2010
Eurozone crisis: Roundup of preparatory documents on Eur-Lex
In Eurozone crisis: Roundup of official information (OJEU), 19 May 2010, we searched for the eurozone rescue decisions published in the Official Journal of the European Union (OJEU) by today.
Only the €60 billion European financial stabilisation mechanism and two supporting decisions by the European Central Bank had been published in OJEU, leaving question marks with regard to openness (transparency), closeness, democracy and the rule of law.
Do we fare any better if we look for the proposals where they should be, on Eur-Lex under preparatory acts?
Here are the proposals and preparatory documents we hope to find in full, or at least properly documented: the €110 billion (including IMF) support package for Greece, Greek austerity and reform measures, the €60 billion European financial stabilisation mechanism, the €440 billion Special Purpose Vehicle, additional IMF participation, national commitments, fiscal and economic reform promises from Spain and Portugal, measures towards greater fiscal prudence, proposals for stricter economic governance and additional ECB decisions.
Eur-Lex roundup
How is this roller coaster month of May reflected by preparatory documents on Eur-Lex?
COM documents
No relevant COM documents were found.
SEC documents
Among SEC documents we find the following, published in 21 languages (but not in English), so I arbitrarily chose to link to the French version:
Recommandation en vue d'une DÉCISION DU CONSEIL adressée à la Grèce en vue de renforcer et d'approfondir la surveillance budgétaire et mettant la Grèce en demeure de prendre des mesures pour procéder à la réduction du déficit jugée nécessaire pour remédier à la situation de déficit excessif ; Bruxelles, le 4.5.2010 ; SEC(2010) 560 final (12 pages)
The proposed Council Decision, based on Article 126(9) TFEU and Article 136 TFEU, sets out revised measures for eurozone member Greece to take for deficit reduction, because the economic growth prospects have worsened and the chances to deficit reduction targets have deteriorated. The attainment date is postponed by two years, to 2014, but the requirements for Greek measures to restore credibility are tightened. The proposal details a real austerity package.
Convergence report
A number of documents relevant to the larger picture of budgetary discipline have been published. The following covers progress towards euro introduction:
Commission staff working document (Brussels, 12.5.2010; SEC(2010) 598 final; 197 pages) accompanying the Commission’s Convergence Report 2010; COM(2010) 238 final [the latter not posted among COM documents on Eur-Lex]
The periodic Convergence Report is based on Article 140(1) TFEU, and it concerns the progress made by member states with a derogation towards achieving economic and monetary union (EMU).
Denmark and the United Kingdom have opted out and 16 EU member states have introduced the euro currency, so the 2010 convergence assessment covers Bulgaria, the Czech Republic, Estonia, Latvia, Lithuania, Hungary, Poland, Romania and Sweden.
Budget discipline
Part of the same larger framework, but regarding individual member states are a number of Commission reports:
Luxembourg Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010; SEC(2010) 588 final (9 pages)
The Commission deals with the application of the Stability and Growth Pact in the current crisis situation, the first step in the excessive deficit procedure with regard to Luxembourg, when the government deficit exceeds the reference value of 3 per cent.
***
Cyprus Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010; SEC(2010) 590 final
Denmark Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010;
SEC(2010) 585 final
Finland Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010;
SEC(2010) 589 final
Bulgaria Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010;
SEC(2010) 587 final
Recommendation for a COUNCIL OPINION on the updated stability programme of Cyprus, 2009-2013; Brussels, 12.5.2010; SEC(2010) 595 final
Summing up
No COM documents directly relevant to the eurozone rescue were posted on Eur-Lex under preparatory documents.
The only SEC document published on Eur-Lex under preparatory documents, which was directly linked to the salvage operation was the proposal for Greek budgetary measures.
The publishing efforts have been unsystematic and people who want to access documents are in for a search from dispersed sources.
The staff working paper accompanying the Convergence Report 2010 (itself absent) and the reports on individual countries form part of the larger task of restoring fiscal probity and budget discipline in the European Union.
How about transparency, closeness, democracy and the rule of law?
Ralf Grahn
Only the €60 billion European financial stabilisation mechanism and two supporting decisions by the European Central Bank had been published in OJEU, leaving question marks with regard to openness (transparency), closeness, democracy and the rule of law.
Do we fare any better if we look for the proposals where they should be, on Eur-Lex under preparatory acts?
Here are the proposals and preparatory documents we hope to find in full, or at least properly documented: the €110 billion (including IMF) support package for Greece, Greek austerity and reform measures, the €60 billion European financial stabilisation mechanism, the €440 billion Special Purpose Vehicle, additional IMF participation, national commitments, fiscal and economic reform promises from Spain and Portugal, measures towards greater fiscal prudence, proposals for stricter economic governance and additional ECB decisions.
Eur-Lex roundup
How is this roller coaster month of May reflected by preparatory documents on Eur-Lex?
COM documents
No relevant COM documents were found.
SEC documents
Among SEC documents we find the following, published in 21 languages (but not in English), so I arbitrarily chose to link to the French version:
Recommandation en vue d'une DÉCISION DU CONSEIL adressée à la Grèce en vue de renforcer et d'approfondir la surveillance budgétaire et mettant la Grèce en demeure de prendre des mesures pour procéder à la réduction du déficit jugée nécessaire pour remédier à la situation de déficit excessif ; Bruxelles, le 4.5.2010 ; SEC(2010) 560 final (12 pages)
The proposed Council Decision, based on Article 126(9) TFEU and Article 136 TFEU, sets out revised measures for eurozone member Greece to take for deficit reduction, because the economic growth prospects have worsened and the chances to deficit reduction targets have deteriorated. The attainment date is postponed by two years, to 2014, but the requirements for Greek measures to restore credibility are tightened. The proposal details a real austerity package.
Convergence report
A number of documents relevant to the larger picture of budgetary discipline have been published. The following covers progress towards euro introduction:
Commission staff working document (Brussels, 12.5.2010; SEC(2010) 598 final; 197 pages) accompanying the Commission’s Convergence Report 2010; COM(2010) 238 final [the latter not posted among COM documents on Eur-Lex]
The periodic Convergence Report is based on Article 140(1) TFEU, and it concerns the progress made by member states with a derogation towards achieving economic and monetary union (EMU).
Denmark and the United Kingdom have opted out and 16 EU member states have introduced the euro currency, so the 2010 convergence assessment covers Bulgaria, the Czech Republic, Estonia, Latvia, Lithuania, Hungary, Poland, Romania and Sweden.
Budget discipline
Part of the same larger framework, but regarding individual member states are a number of Commission reports:
Luxembourg Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010; SEC(2010) 588 final (9 pages)
The Commission deals with the application of the Stability and Growth Pact in the current crisis situation, the first step in the excessive deficit procedure with regard to Luxembourg, when the government deficit exceeds the reference value of 3 per cent.
***
Cyprus Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010; SEC(2010) 590 final
Denmark Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010;
SEC(2010) 585 final
Finland Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010;
SEC(2010) 589 final
Bulgaria Report prepared in accordance with Article 126(3) of the Treaty; Brussels, 12.5.2010;
SEC(2010) 587 final
Recommendation for a COUNCIL OPINION on the updated stability programme of Cyprus, 2009-2013; Brussels, 12.5.2010; SEC(2010) 595 final
Summing up
No COM documents directly relevant to the eurozone rescue were posted on Eur-Lex under preparatory documents.
The only SEC document published on Eur-Lex under preparatory documents, which was directly linked to the salvage operation was the proposal for Greek budgetary measures.
The publishing efforts have been unsystematic and people who want to access documents are in for a search from dispersed sources.
The staff working paper accompanying the Convergence Report 2010 (itself absent) and the reports on individual countries form part of the larger task of restoring fiscal probity and budget discipline in the European Union.
How about transparency, closeness, democracy and the rule of law?
Ralf Grahn
Tuesday, 18 May 2010
Eurozone crisis: Founding myths rewritten?
In the midst of the eurozone crisis, a whiff of the unbearable lightness of being.
Brussels newcomer and euroblog veteran Julien Frisch has asserted that the European dream is not dead (18 May 2010), but what if we have to rewrite our founding myths?
Perhaps the next generation of Greek 2 euro coins should not depict Europa carried away by a bull (ECB images), but ravaged by a bear.
Ralf Grahn
Brussels newcomer and euroblog veteran Julien Frisch has asserted that the European dream is not dead (18 May 2010), but what if we have to rewrite our founding myths?
Perhaps the next generation of Greek 2 euro coins should not depict Europa carried away by a bull (ECB images), but ravaged by a bear.
Ralf Grahn
Subscribe to:
Posts (Atom)
Subscribe To Grahnlaw
Posts
All Comments
