Monthly Archives: January 2007

Tony Blair is not the most loved politician in Europe: too pro-American, too liberal, too British and so on. But what many European politicians seem to have missed is that Blair is the most pro-European British prime minister since Edward Heath in the 1970s: things aren’t going to get any better.

Gordon Brown, Blair’s presumed successor, has a reputation around Europe for being uninterested in the EU and dismissive in his dealings with fellow ministers. But what would happen if Brown lost the next British election – probably in 2008 or 2009 – to the Conservatives?

A glimpse of Britain’s European future came on Wednesday in a wide-ranging speech by William Hague, the Conservative foreign policy spokesman. If you thought Tory thinking had moved on much since the days of Margaret Thatcher, this might make you think again.

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A rare sighting of Gordon Brown in Brussels on Tuesday, which dutifully followed his usual routine for Ecofin councils. Namely the British press in London is briefed in advance on the lecture he intends to deliver to fellow finance ministers – this time on the failings of the EU’s single market.

Britain’s chancellor of the exchequer then turns up at the meeting and delivers the message that other finance ministers have already read about in the morning papers. Then he flies home again. Job done.

“He’s right of course,” says one Ecofin participant. “His observations on the single market and what needs to be done are valid, but the way he does it is counter-productive. He comes across as arrogant, he doesn’t get involved in networking.” Read more

I’ll be in Madrid on Friday, listening to the representatives of 20 countries protesting their love for the European Union constitution (deceased), and insisting that as much of the hallowed treaty should be saved as possible.

That is their right and they have a point. After all, 18 out of 27 member states have ratified the constitution (that’s the equivalent of 270m people) and Portugal and Ireland will also be in Madrid as non-ratifying but honorary "friends of the constitution".

But they should prepare to be disappointed. The fact is that if anything is going to be saved it will have to be modest, unthreatening and boiled down to its barest essentials. This is how you do it:

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European Commission officials essentially fall into one of two categories. On the one side there are the ordinary functionaries who spend years drawing up legislative proposals, writing up impact assessments or monitoring developments in the Italian olive oil market. Perfectly important business, mind you, but in the main their jobs rarely send the pulse racing.

The second (and far more dashing) type of official is the one you find at the directorate general for competition, or DG Comp in short. As Europe’s top competition enforcement officials, they do all kinds of exciting stuff. They get to raid the headquarters of big companies, impose huge fines on businesses that break the rules, and every so often they can tell Microsoft how to run its business.

But over the past year or so, I have detected a subtle change inside DG Comp. It seems that the hard-bitten trust-busters have gone, well, a little academic.

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There is a new odd couple at the centre of the EU – Gabriel and Glos. You often have to pinch yourself to recall that Sigmar Gabriel and Michael Glos are members of the same government – Germany.

Gabriel is the up-and-coming environment minister from the centre-left Social Democratic party. Glos is the Christian Social – for which read Christian Democrat – economics minister from Bavaria,  a conservative heartland and one of the richest areas of Europe. He wants it to stay that way. So he has no time for eco-warriors wanting to dent its way of life. The two are strange bedfellows in a grand coalition government and Tuesday once again proved why.

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Has the president of the European Central Bank finally given ground in the long-running "battle of the Jean-Claudes"? After months of refusing to discuss holding more meetings with Jean-Claude Juncker, the political head of the eurozone, ECB chief Jean-Claude Trichet, now seems ready to talk.

Mr Trichet famously refused to reply to a letter from Mr Juncker last year, after the Luxembourg prime minister suggested they should have regular informal chats – possibly over breakfast. The ECB president reckoned his public acceptance of this invitation to coffee and croissants could be seen as giving in to political pressure.

But earlier this month the two did get together for an informal 45-minute chinwag in Frankfurt, along with Joaquin Almunia, the EU monetary affairs commissioner. More such encounters could follow. So has Mr Trichet sold part of the bank’s independence, as some of the sobre suited boys at Germany’s Bundesbank seem to believe?

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Blogs are supposed to be engaging, whimsical, opinionated and should at least try to provide an entertaining angle on the great matters of the day. I am not sure, therefore, that it is a great idea to devote an entire posting to the bleak, bone-dry world of accounting and auditing, but I’ll give it a try all the same.

The bean-counters have, after all, attracted quite a lot of attention inside the European Commission recently. This has a lot to do with the somewhat surprising notion that accountants and auditors are a bit like those mountain gorillas in central Africa that have been dropping dead at an alarming rate in recent years. In other words, there are plenty of people who believe the profession is an endangered species that requires urgent protection.

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It may seem like clever domestic politics, but Ségolène Royal’s plan to re-run France’s referendum on the EU constitution looks like a disaster waiting to happen: both for France and Europe.

Ms Royal will win plaudits for her commitment to giving the French people their democratic voice, should she win the French presidential elections this spring. Nicolas Sarkozy, her rival, has already committed himself to trying to negotiate a "mini" version of the constitution and to ram it through the national assembly. Read more

Ralph Atkins in Frankfurt

Nordics are setting the pace in central bank transparency. That is clear from the announcement this week by Sweden’s Riksbank

that it will follow Norway’s example in publishing forecasts of its own interest rates.

Don’t yawn: this is state-of-the-art stuff in academic economics circles. Monetary policy these days is largely about influencing the economy through expectations.

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The last time Serbian and European leaders really got together, they seethed at each other. So why is the EU dusting off its plans to cuddle up to Belgrade? And why do I think it is a good idea?

I remember that last meeting in October, when, bunkered down in a conference centre in Luxembourg, Vojislav Kostunica, Serbia’s prime minister, proclaimed his country’s heartfelt desire to hang on to the province of Kosovo – whatever the wishes of the EU or US.

Olli Rehn, the EU’s enlargement Commissioner, said Serbia had done nowhere near enough to track down Gen Ratko Mladic, the man blamed for Europe’s worst massacre since the second world war – the killing of up to 8,000 Muslim men and boys at Srebrenica in 1995.

The air was thick with recrimination. Rehn made clear that unless Serbia did much more on handing over Mladic, there was no chance that talks would resume on deepening Belgrade’s ties with Brussels,  negotiations supposed to open the way for Serbia to join the EU.

Now, however, Rehn is giving off much more positive signals, making clear that, if Serbia’s parliamentary elections on Sunday go well, the talks could pick up where they left off and make up for lost time.

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Are Europe’s governments just blowing hot air when it comes to climate change? On Tuesday it was the turn of Belgium and the Netherlands to be told by Brussels that their proposed greenhouse gas emissions were too high.

Slovakia, meanwhile, is mulling over whether to take legal action after a similar order.

Last week the European Commission called for ambitious targets to reduce emissions by at least 20 per cent below 1990 levels by 2020 but national governments seem reluctant to agree, undermining efforts to persuade George W Bush and others to join in a global scheme.

So far, the Commission has found 11 of the 12 plans for 2008-12 capped emissions at too high a level.

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Visiting Berlin last week, the front page headline in Bild Zeitung transported me back to Britain 15 or even 20 years ago. "Crazy salaries," shouted the story from the newsstands, complaining about how Brussels officials earn so much more than their Berlin counterparts and listing their allegedly lavish perks.

It could have been The Sun, during the good old days. The fact is that the British tabloid has concluded that Europe is boring and frankly a lot less threatening that it used to be. The paper hardly ever puts the issue on the front page. So what’s up with the Germans?

The fact is that British euroscepticsm, while undoubtedly rooted in the country’s geography and history, was fanned by a feeling that the British system was under threat. During the 1980s and 1990s there was a sense in the right-leaning media that Brussels was trying to kill the Thatcherite revolution with ideas of "social Europe" and suffocating red tape.

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On the face of it, the European Commission had some shocking news for shareholders of Eon and RWE in Germany, OMV in Austria and similar listed energy groups across the region. The Brussels regulator on Wednesday vowed to break up all energy suppliers that are also active in managing networks such as grids and pipelines. It argued that the combination of the two businesses stifled competition.

Given the Commission’s sweeping powers to initiate legislation, scrutinise mergers and pursue antitrust infringements, such a step is certainly not beyond Brussels’ reach. That would mean forcing some of Europe’s biggest groups not only to sell off priceless assets but also to face much sharper competition from smaller rivals.

And yet, this shocking news somehow failed to strike fear in the hearts of investors. RWE’s shares actually gained slightly, while Eon and OMV posted only minuscule falls that mirrored the broader market. What’s up? Don’t traders read the newspaper?

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On a lightning visit to Berlin last year, I discovered that Germany is groaning with plans for its six month long presidency of the EU. One theme struck me in particular: Angela Merkel’s improbable ambition to bring hope to the Middle East. You might not believe it, but this is an issue where the German chancellor really thinks she can make a difference.

Like many other European states, Germany feels strongly that the US ought to do more with its international partners to broker a deal between the Israelis and the Palestinians.

That’s why Merkel told the FT she wanted to revive the Quartet, the body made up of the US, the EU, Russia and the United Nations that is supposed to work for Middle East peace.

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Joseph Daul is an unlikely revolutionary. The Strasbourg farmer who was elected narrowly on Tuesday night as the head of the centre-right European People’s party looks like a throwback to the early founders of Europe among past holders of the post.

Judging from the rogues gallery on the EPP’s website the last innovation by its leadership was Egon Klepsch’s radical decision in 1977 to dispense with the obligatory pocket handkerchief.

Yet Daul, 59, called himself one of the ‘68 generation and his measured response to the yawning split revealed by the election suggests he could chart a delicate path forward.

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It’s almost mid-January in Brussels and there has not been a single frost in the city. People are shedding their winter coats, trees are sprouting leaves; a rose made an appearance in my garden last week. It doesn’t take a climatalogical genius to realise something is going on, and at long last Europe’s policymakers seem to be taking it seriously.

As recently as last May, José Manuel Barroso did not even mention climate change as one of his top priorities; now it is the cornerstone of almost everything the European Commission does, and is at the heart of Wednesday’s announcement of a new EU energy policy.

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Democracy is slowly coming to the European parliament. It’s hard to tell whether that, or the formation of a far-right group, is more shocking for the mainstream MEPs who provide most of the voting fodder.

One can deride the 20 or so MEPs from six countries who are set to form a new caucus on Wednesday that would give them speaking rights in parliament. A motley crew, ranging from holocaust deniers to gypsy-baiters, most people wouldn’t want to sit next to them on a bus never mind in a parliament. But they don’t particularly like each other any more than most like them.

It’s the EU’s expansion to Romania and Bulgaria on January 1st that has made the far-right nightmare, long talked-about in Strasbourg, close to coming true. Veterans like Jean-Marie Le Pen’s National Front now have allies in the requisite five European countries to form a group. Bulgaria’s anti-Roma Ataka party and the nationalist Great Romania party of Corneliu Vadim Tudor are set to join what could be known, evocatively, as "Europe of the Fatherlands" or "Identity, Sovereignty, Tradition".

But they would not even be talking to each other if it were not for the consensus-cloying way the parliament works.

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Just before Christmas, I went on a daytrip to Iraq. I was part of the press pack following Tony Blair around and, although the other journalists and I gave pretty short shrift to the prime minister’s whole Middle East trip, it was, in many ways, an illuminating experience.

For example, there was the sight of Blair’s top advisers donning helmets and body armour to visit a country that was supposedly liberated three and a half years ago. And there was the prime minister himself, seemingly tired and stressed on what could turn out to be his last official trip to Iraq, evidently relieved when his Hercules aircraft left Baghdad and Basra behind it and headed for Tel Aviv.

The trip also raised an intriguing possibility for the future of British and European foreign policy.

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When the European Commission starts talking about a plan to "connect the EU with its citizens" you know that something supremely ridiculous is about to happen. Poster competitions are one popular device, but the Commission on one occasion even tried wowing Europeans by sending a copy of the draft EU constitution into space.

This month Brussels will unleash its latest drive to befriend the alienated citizen – and for once it has actually come up with an idea that is simple, innovative and that promises to do some lasting good.

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Remember the Azores "war summit" of 2003, on the eve of the Iraq war? Since that meeting on the windswept Atlantic islands the curse of Iraq has struck down most of its participants: George Bush and Tony Blair are heading out of office haunted by the unfolding disaster on the Euphrates, while Jose Maria Aznar is already gone.

But what about the fourth participant, the host Jose Manuel Barroso, the hitherto little-known Portuguese prime minister, lurking almost unnoticed on the edge of camera shot? He’s still going strong, and now as European Commission president he wants a favour returned by his old buddy, President Bush.

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