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24 October 2013

Integrating Europe - 24th October 2013




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Articles from 17 October 2013 - 24 October 2013

Political

IIEA/Barry: Selecting the next President of the European Commission
The field is wide open to candidates for the powerful position of President of the European Commission and speculation is rife, in particular because the rules of the game have changed since President Barroso began his second term in 2010.  View Article
Jan-Werner Mueller: How Europe could face its own shutdown
An alliance of anti-EU parties led by the Front National's Marine Le Pen could take Europe into its own shutdown, writes Mueller in the Guardian. European citizens will not get different policies, but paralysis.  View Article

Financial

Bundesbank/Dombret: The yin and yang of resolving the European sovereign debt crisis
Speaking at the Peterson Institute, Dombret argued against burden-sharing that would render the whole eurozone less competitive on the global market, and said that eurobonds would only exacerbate the "deficit bias" already present.   View Article
Avinash Persaud: Bail-ins are no better than fool's gold
Writing for the FT, Persaud argues that trying to resolve the crisis by avoiding taxpayers is likely to fail and will certainly prove inefficient.   View Article
http://www.institutdelors.eu/en/about-us/activity-and-statutes/',WIDTH, 300, SHADOW, true, FADEIN, 300, FADEOUT, 300, STICKY, 1,DURATION,3500)" onmouseout="UnTip()");">Notre Europe - Jacques Delors Inst/Vitorino: A time-lag problem, or even a lack of consistency
Vitorino discusses i.a. Banking Union and the social dimension of EMU. He looks at the "time-lag problem" between the major decisions adopted by the European Council and their ensuing implementation.  View Article
EFSF issues seven-year bond
More than €10.5 billion in orders were received from investors worldwide. CEO Christophe Frankel said that thanks to consistently strong demand, the EFSF had nearly completed its funding programme for 2013.  View Article
IMF Working Paper: Fiscal consolidation in the euro area - How much can structural reforms ease the pain?
The IMF's Global Integrated Monetary and Fiscal model (GIMF) is used to examine the scope for structural reforms in the euro area to offset the negative impact of fiscal consolidation required to put public debt back on a sustainable path.  View Article
European Council's draft conclusions: EMU / Banking Union
Ahead of the meeting of EU leaders this week, Open Europe has published an updated version of the draft council conclusions on its website.  View Article
ECB starts comprehensive assessment in advance of supervisory role
The ECB announced details of the comprehensive assessment to be conducted in preparation of assuming full responsibility for supervision as part of the SSM. (Includes EBF and BaFin/Bundesbank statements.)  View Article
EBA publishes final draft TS on NPLs and forbearance reporting requirements; issues AQR recommendations
The final ITS will provide consistent indicators of asset quality of banks across the EU. EBA also issued recommendations on asset quality reviews (AQRs), including the work of the SSM and its balance sheet assessment.  View Article
Schäuble: The Banking Union – another step towards a tighter-knit Europe
Banking Union "emphatically is not and cannot be a mechanism to redistribute the burden of yesterday's crisis among its participants", said Schäuble. "Whatever legacy issues come to light now will have to be tackled nationally."  View Article
ACCA: Banking Union - Towards a solid and sustainable integrated financial framework?
The ACCA President's debate showed general support for the Banking Union, while acknowledging that serious challenges lie ahead.  View Article
Commissioner Almunia: Competition among financial markets operators
Almunia said that safeguarding competition in the financial sector remained a top priority. He clarified how the new State aid rules fitted in with the overall framework of the Banking Union, and how they would help with the transition.  View Article
Bloomberg: Draghi challenges EU bank aid rules over forced losses
In a letter to Commissioner Almunia, Draghi warned that the new state aid rules – which would see significant losses for bank bondholders before any bailout – could "destroy the very confidence" in European banks which the EU is working to restore.   View Article
Reuters: European official calls for bank bail-in from 2016
According to Spiegel magazine, the head of the Eurogroup Working Group has proposed an earlier start of 'bail-in' arrangements which force bondholders to share losses in a bank failure, in a bid to win over German concerns over creating a Banking Union.  View Article
Bloomberg: EU deal on resolution mechanism faces tight deadline
Without a deal on the SRM before EP elections in May, there is a risk that the ECB will be lacking a critical tool when it starts supervising euro area lenders next year. Commission Barnier has said he is open to compromise on the plans.  View Article
Single Resolution Mechanism - what the papers say
Scandinavia's banks are contesting a plan by the EBA that requires lenders to adopt a uniform approach when calculating capital buffers; the UK and Sweden are seeking EU budget safeguards; Merkel could be about to agree to the SRM - under three conditions.  View Article
ECB publishes details of ELA procedures
The ECB has revealed for the first time the details of its emergency lending programme, Emergency Liquidity Assistance (ELA).  View Article

Economic

Commission adopts Work Programme for 2014 - A year of delivery and implementation
With the adoption of its Work Programme for 2014, the Commission puts a very strong focus on results: it identifies the priority growth-enhancing proposals to be completed in the months ahead and focuses i.a. on the finalisation of the Banking Union.  View Article
Plenary Session: EU economic and budget coordination must improve, say MEPs
Economic and budgetary policies of EU countries need to be far better coordinated in order to give a boost to growth, employment and investment. The European Semester, designed to do just that, is not delivering the goods, MEPs warned in a resolution.  View Article
Interparliamentary Conference held in Vilnius discussed post-crisis economic governance in the EU
All the speakers stressed the importance of enhanced cooperation between the EP and national Parliaments in setting the right framework for post-crisis economic governance.  View Article
ECFIN Economic Paper: Fiscal consolidations and spillovers in the euro area periphery and core
Coordinated austerity in euro area countries has stifled economic recovery and deepened the crisis across the currency bloc, according to a new technical paper prepared by an economist at the European Commission.  View Article
EP: EU best placed to regulate banks, says Eurobarometer poll
Over half of EU citizens feel that banks should be regulated by the EU, rather than national governments. Half also believe that they would be better protected against the economic crisis if their countries coordinated anti-crisis measures with other EU Member States.  View Article
Commissioner Andor: Sound social dialogue is vital for the future of the European economic and social model
"The Commission is firmly convinced that social dialogue is not a luxury, but a vital factor in Europe's competitiveness and cohesion."  View Article
European Commission: EU and Canada conclude negotiations on trade deal
President Barroso and Canadian PM Harper have reached a political agreement on the key elements of a Comprehensive Economic and Trade Agreement (CETA). This agreement will remove over 99 per cent of tariffs between the two economies. (Includes EPP/S&D responses.)  View Article
Bruegel/Glienicker Group: Towards a Euro Union - Without more integration, further crises loom
11 German economists, political scientists and jurists – the Glienicker Group – develop proposals for a deeper Europe.  View Article
Bloomberg: Germany's SPD seeks to tap transaction tax for bank failure fund
Merkel's potential coalition partners, the Social Democrats, want to make implementation of a proposed financial transaction tax a requirement for participation in the Banking Union.  View Article
WSJ: France weighs softening proposed transaction tax
France's Finance Ministry is considering transforming a stick into a carrot in a bid to gain French banks' support in reviving the country's stock exchange.  View Article

Budgetary

Plenary Session: Parliament votes urgent €2.7 billion amending budget to close resources gap
Parliament has approved €2.7 billion in additional EU funding for 2013. The amending budget (N° 6) was needed to avert a 'shutdown'.  View Article
Plenary Session: Budget 2014 - Parliament reverses Council cuts in research and jobs expenditure
Parliament reversed the Council's proposed cuts in research and employment expenditure in 2014 in a plenary vote in Strasbourg. (Includes statement by Commissioner Lewandowski.)  View Article
ECOFIN Council: Start of the conciliation talks on the EU budget 2014
The Council informed the EP that it cannot approve all its amendments for the 2014 EU draft budget. This means that a three-week conciliation period will start from 24 October, aimed at bridging the gap between the divergent EP and Council positions.  View Article
Merkel demands EU Treaty change to give Commission control over national budgets
Angela Merkel wants to expand the power of the EU and give Brussels extensive rights in the control of national budgets. Resistance is expected from both her European partners and the German SPD party. (Includes comment from President Barroso.)  View Article
Fitch: Eurozone fiscal governance progresses, challenges remain
The submission of 2014 draft budgets by the 17 members of the eurozone to the European Commission is an important step towards deeper fiscal and financial integration in the single currency bloc, Fitch Ratings says.   View Article
Simon Wren-Lewis: How not to run fiscal policy - More lessons from the eurozone
Wren-Lewis writes that the Commission was right to propose the changes to the way it calculates structural deficits, but wrong to cave in on the issue.  View Article

Member State events

Cyprus banking sector adequately capitalised
Cyprus' banking sector is expected to show further losses in 2014, as the economy worsens and banks book rising non-performing loans, but the sector is adequately capitalised, said the head of its Central Bank (CBC).  View Article
Fifth Activity Report of the Task Force for Greece: Supporting vital reforms
The period April-September 2013 has witnessed a broadening and deepening of the technical assistance provided by the Task Force, which supports the Greek authorities in implementing the economic reform agenda linked to the country's financial assistance programme.  View Article
Kathimerini: Rehn says no decision on Greek debt relief until summer
Greece will have to wait until next summer to find out whether it will be granted further debt relief by its eurozone partners, and must be prepared for close monitoring of its public finances for many years to come, VP Rehn has revealed.  View Article
Kathimerini: No bailout if more austerity measures are demanded, says Stournaras
The Greek finance chief said that negotiations regarding Greece's fiscal gap, financing shortfall and what form further debt relief might take will continue, but he was adamant that Athens would not accept more fiscal measures being added to the agenda.  View Article
Wolfgang Münchau: Italy misses the chance to reform
Stand by for budget amendments designed to cater to special interests, writes Münchau in his FT column.  View Article
Germany: Before the start of the coalition negotiations
Coalition negotiations are likely to be complicated. The Left party and Greens argue that if a grand coalition is formed, the opposition would not hold the number of seats required to exercise crucial checks and balances on the government.   View Article
Germany's SPD agrees to enter into coalition talks with Merkel
The Social-Democrats (SPD) have agreed to coalition talks with Merkel's CDU and aim to form a new government by Christmas, further postponing any decisions on eurozone governance. They have set out minimum demands for a coalition deal, including statutory minimum wage, an FTT and more investment.  View Article
Telegraph: France's FN to team up with other far Right parties for European elections
Front National leader Marine Le Pen has announced a plan to create a pan-European far-Right front, teaming up with Dutch, Swedish, Belgian and Austrian anti-immigration parties, but not forming an alliance with neo-fascist parties.  View Article
Commissioner Barnier: The UK in the EU Single Market - Opportunities and challenges
Speaking at the London School of Economics, Barnier said that to opt out of rules on financial services "would be to open a Pandora's box". "You can't reform a club if you have given in your membership card", he remarked.  View Article
Jonathan Faull: Can the UK afford to turn its back on Europe?
EU single market benefits to the UK are between five and 15 times Britain's net EU budget contribution, argues DG MARKT's Faull in the Parliament magazine.  View Article
UK/Germany to lead on EU reform?
"There's a historic opportunity for Britain and Germany to lead the work of improving the structures of the EU, together with other like-minded countries", writes the Spectator. Other media coverage included the UK government's report on reducing red tape and further liberalising the single market.  View Article
UK Government launches Balance of Competences Review on the EU Budget and Financial Services
The UK Government has published two calls for evidence on the balance of competences between the UK and the EU on the EU budget and financial services and the free movement of capital. The CfEs run until 17 January, 2014. (Includes link to further D-BIS CfEs.)  View Article
The Regent's Report 2013: UK and the EU - Costs, Benefits, Options
A study from Regent's University in London indicates that a UK exit from the EU could jeopardise London's position as a financial centre and weaken the country's attempts to influence legislation.  View Article
Juncker faces battle to remain Prime Minister in Luxembourg
Juncker's centre-right Christian Social People's Party (CSV) suffered losses in Luxembourg's national elections but it remains the strongest party in parliament.   View Article
Vienna 2 Initiative draws attention to weak credit growth
The Vienna 2 Initiative Full Forum assessed recent trends in deleveraging, credit provision, and non-performing loans in the CESEE banking sectors.  View Article





© Graham Bishop


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