Monthly Archives: March 2010

Now that Greece has dealt with its fiscal emergency, it can turn its attention to another impending crisis: the physical fitness crisis.

A new survey published by the European Commission reveals that Greece scores at the bottom – along with Bulgaria and Italy – of a ranking of member states by sports participation. Just 3 per cent of Greeks play sports regularly, a fact that woud surely make the ancients pole vault in their graves. By contrast, Ireland came top of table with 23 per cent, closely trailed by the Nordic countries. Read more

Understandably overshadowed by the Greece rescue agreement last week was the much smaller piece of news that Lady Ashton’s spokesman, Lutz Güllner, is stepping aside. He is departing just four months into her new job as Europe’s first foreign policy chief.

At first reading, this seems like further fallout from Lady Ashton’s rough early tenure, in which she’s come under attack for everything from a weak response to the Haiti crisis to a poor command of French. But I think it tells us something more. Read more

From Gideon Rachman’s blog

At European summits, it is easy to get the mistaken impression that the arguments are all about finding the correct policies or defending national interests. I suppose, sometimes, that is the case. But more often that not, it seems to come down to personality politics. I was struggling earlier today to understand why the French had been so reluctant to involve the IMF in the putative rescue of Greece. In my innocence, I thought it might have something to do with a French preference for a “European solution”. But then a French colleague explained to me. It’s simply that Nicolas Sarkozy sees Dominique Strauss-Kahn, the head of the IMF, as a potential rival in the next French presidential election. So he doesn’t want to agree to anything that might make Strauss-Kahn look good. Read more

Eurozone leaders back Greek rescue deal

There is joy and harmony in euro world today. After looking over the precipice, European leaders decided to pull back and agree a rescue package for Greece. At a press breakfast this morning, José Manuel Barroso, European Commission president, was positively buoyant. Europe, he said, could have gone either way in the face of the latest crisis. In the end, it decided to leap forward towards greater integration and cooperation. In rock and roll terms, the whole thing had the feel of a band, whose bickering members — after threatening to embark on ill-conceived solo projects — finally calm down, come to their senses and determine to go on tour again.

-But don’t you guys hate each other? the media asks.
-No, no. We love each other. But this time we’re going to do things differently. There will be new rules about wives and girlfriends on the bus. Oh – and drugs. Vince has agreed to go cold turkey – at least during shows.

We’ll see how long that lasts. Read more

From Gideon Rachman’s blog

When the euro was launched in 1999, the British were constantly being warned that if they refused to join the European single currency, they would eventually find themselves marginalised within the European Union. The Brits scoffed at this notion. But it seems to be true. A desperate deal to extricate the euro-zone from the Greek crisis is currently being hammered out, a few floors above where I’m sitting, here in the gloomy Justus Lipsius building in Brussels. But the British are essentially irrelevant to the negotiations. And happy to be. Read more

Greetings Brussels blog fans. As you may have guessed, Tony Barber is away this week, and so I will attempt to step into his shoes for a few days. Think of me as a younger, fresher version of our Brussels bureau chief. Which is to say, while Tony has lived and reported from every corner of Europe over the last 20-plus years – covering Balkan wars and Berlin walls – I am a New Yorker who first set foot in Brussels 18 months ago. Believe it or not, before I came to Brussels I barely knew my GAERC from my GYMNICH and I still get lost in the European Parliament building.

Angela Merkel arrives at the European Council

Angela Merkel arrives at the European Council

I don’t think it’s a stretch to say that today’s is the most gloomy European Council meeting I’ve ever been associated with. This was supposed to be the time when a post-Lisbon treaty Europe was confidently striding on the world stage. Instead, Europe is still suffering the hangover from December’s Copenhagen climate summit, when it was rudely elbowed aside by China and the US. (A Copenhagen post-mortem will be the main Council exercise on Friday morning. Fun.) Read more

Brown delays EU hedge funds reform (George Parker and Nikki Tait, FT)

Merkel defends German economic record (Quentin Peel, FT) Read more

Tony Barber

The financial rescue plan devised by eurozone governments for Greece doesn’t look like a rescue plan in the classic sense.  Like a thermonuclear weapon, it appears intended never to be used at all.  The idea is that the Greek government itself, backed by calmer financial markets, will succeed in overcoming its debt crisis without ever drawing on assistance from its 15 euro area partners. Read more

Tony Barber

Setting up the European Union’s new diplomatic service was never going to be easy.  Turf wars between the EU’s 27 member-states and the European Commission were inevitable, and the ever meddlesome European Parliament was certainly not going to pass up an opportunity to stick its oar in.  But if the EU doesn’t get this right, the world’s other big powers will never be convinced that the Europeans are serious about operating a coherent common foreign policy. Read more

Tony Barber

The European Union is often derided for policy confusion and speaking with a multitude of voices – but sometimes it’s not the EU’s fault, it’s the fault of one of the member-states.  Take the idea of setting up a European Monetary Fund.  This emerged as a serious possibility for the first time when Wolfgang Schäuble, Germany’s finance minister, offered support for it in an interview last weekend with Welt am Sonntag.

Within a couple of days, however, Germany’s two most important central bankers – Axel Weber, the Bundesbank president, and Jürgen Stark, an executive board member of the European Central Bank – had distanced themselves from the idea.  Even more confusingly, Chancellor Angela Merkel chipped in with the remark that it wouldn’t be possible to set up a European Monetary Fund without changes to the EU’s governing treaty.  As she well knows, after the agonising experiences first with the EU’s failed constitutional treaty and then with the Lisbon treaty (which finally came into force in December), there is next to no appetite for such changes among the EU’s 27 governments. Read more

Tony Barber

I take it that everyone has seen the insulting picture on the cover of the February 22 edition of Focus, a lightweight German news magazine?  Under the headline ”Swindlers in the euro family”, it shows the Venus de Milo statue, a monument of ancient Greek civilisation, sticking up a middle finger at Germany.  In this way the magazine’s editors convey, as offensively as possible, the idea that debt-ridden Greece is robbing Germany blind by forcing it to come to Greece’s financial rescue.

The Greek response has been predictably furious.  The Greek consumers’ federation has called for a boycott of German goods, commenting that Greeks were creating timeless works of art like the Venus de Milo at a time when Germans were “eating bananas in the trees”. Read more

Tony Barber

The European Union needs to raise its economic growth potential – on that, at least, the bloc’s 27 member-states and the European Commission agree.  Otherwise Europe risks a speedy descent into relative economic decline, and its cherished “social model” – combining a liberal market economy with cradle-to-grave public services – will be increasingly unaffordable.  Will the Commission’s latest proposals, published last week under the title “Europe 2020: A European strategy for smart, sustainable and inclusive growth”, do the trick? Read more

Greece plan tax rises and spending cuts (FT reporters, FT)

Hedge funds prosper from Greek debt (FT reporters, FT) Read more

Tony Barber

The most important speech delivered in Europe last week came from Herman Van Rompuy, the European Union’s full-time president.  It had real depth and did not try to conceal the EU’s problems behind a mask of unconvincing optimism.

The speech addressed how to strengthen Europe’s role in a world in which the Old Continent appears in danger of slipping into faster relative decline unless it gets its act together.  The speech had much to say about economic policy, but it was the foreign policy content that was more original.  This was Van Rompuy’s first detailed exposition of his views on the subject. Read more