Category: EU

Dutch EU Commissioner Neelie Kroes: "No ‘man overboard’ if we lose someone from eurozone."

[UPDATE 2] Dutch finance minister Jan Kees de Jager was asked about Kroes’ comments during the government’s regular parliamentary question time Tuesday. De Jager said that while the contagion risk in the eurozone has decreased over the last year because of measures taken in Brussels, a Greek exit would still be very costly.

[UPDATE] In response to Kroes’ comments, Olivier Bailly, an EU Commission spokesman, today insisted its policy towards keeping Greece in the euro has not changed.

José Manuel Barroso, the European Commission president, may have promoted his economic chief Olli Rehn to vice president last year with new responsibilities for managing the eurozone crisis, but in recent days a growing number of other commissioners seem to be elbowing in, opining on whether Greece will leave the single currency.

On Monday came an interview with Greece’s own commissioner, Maria Damanaki, where she told the newspaper To Vima tis Kyriakis that contingency plans for Greece leaving the euro were being “openly studied”. “Now they’re not simply scenarios,” said Damanaki, whose portfolio is fisheries. “They are alternative plans that are being openly studied.” Rehn’s spokesman insisted that no such plans were afoot within the commission, although he acknowledged some in the private sector were making such calculations.

This morning, however, comes another broadside, this time from Neelie Kroes, the European commissioner from the Netherlands – one of the eurozone’s remaining triple A-rated countries where support for more aid to Greece is dwindling.

Finn Olli Rehn, last week in Davos, has been seen on Finnish media by 45% of his fellow countrymen.

In Brussels, being a member of the European Commission, the EU’s executive branch, is about as high as an official can climb in the eurocracy. But just how well are those Brussels luminaries known back in their home countries?

Thanks to the commission itself, we now have a good idea. According to a telephone survey conducted by Eurobarometer – the results of which haven’t been published, but were presented to commissioners during a meeting Tuesday – the best-known is Finland’s Olli Rehn, the economic commissioner who has been in the press almost constantly thanks to the eurozone crisis. He also contemplated running for president of Finland last year, which undoubtedly helped boost his score.

According to the survey, obtained by Brussels Blog, 45 per cent of Finns said they had seen or heard Rehn in the media, far ahead of the rest of the commission – including its president, Portugal’s José Manuel Barroso, who finished 9th with 31 per cent of Portuguese respondents saying they’ve seen the former prime minister on local media.

At the bottom of the list were commissioners from two of the largest member states: France’s Michel Barnier, who only 8 per cent of French respondents said they had heard or seen, and Britain’s Cathy Ashton, who came in at 16 per cent.

The complete list after the jump.

When word filtered out on Tuesday that Russia’s Gazprom would be capping its gas shipments to the European Union, a shiver went through an unusually frigid Brussels.

After two major supply cuts in the last ten years – the most recent in 2009 – European policymakers have become conditioned to believe that any interruption in Russian gas may be the beginning of another full-blown crisis instigated by the Kremlin.

Gazprom said it was going to have to limit European sales in order to serve the needs of domestic consumers struggling through a cold winter. Fears appeared to subside a bit, though, when the company promised to try to make up the difference over the coming days.

Perhaps the most surprising thing about the incident is how quickly it has become a non-event. The reason, according to EU officials, is that the continent learned the lessons from the last gas crisis and has worked to make itself far less vulnerable to future Russian shocks.

Portuguese prime minister Pedro Passos Coelho arriving at Monday's EU summit in Brussels

As financial markets watch with nervous anticipation the outcome of the tense negotiations over Greece’s debt restructuring, there is clear evidence that bond investors believe Portugal could be next, despite repeated insistence by European leaders that Greece is “an exceptional and unique case” – a stance reiterated at Monday’s summit.

Portugal’s benchmark 10-year bonds were over 17.3 per cent this week, though things have eased off a bit today. Those are levels seen only by Greece and are a sign the markets don’t believe Lisbon will be able to return to the private markets when its bailout ends next year. Default, the thinking goes, then becomes inevitable.

But are Greece and Portugal really comparable? Portugal certainly shares more problems with Greece (slow growth, uncompetitive economy) than with Ireland and Spain (housing bubbles, bank collapses). But unlike Greece, where talk of an inevitable default was the topic of whispered gossip in Brussels’ corridors from almost the moment of its first €110bn bailout, there is no such buzz about Portugal.

More concretely, the latest report by the European Commission on the €78bn Portuguese bail-out, published just a couple weeks ago, paints a much different picture for Lisbon than for Athens. An in-depth look at the largely overlooked report after the jump…

Monday’s meeting of EU leaders is meant to focus on growth and jobs, which makes it all the more ironic that it will likely be heavily disrupted by a general strike called by Belgian unions on the same day.

The timing of the strike is a coincidence, unions claim: this is a Belgian rather than a European strike. It was called for in response to clumsy pensions reforms by the new government, led by the Socialist Elio Di Rupo, rather than as a protest against the EU’s austerity measures (though the unions don’t like those much either.)

The impact of the strike is unclear. One high-ranking official in the secretariat of the Council, which organises the event, told Brussels Blog yesterday that there had been serious talk of moving the entire meeting to Luxembourg, where some EU ministerial-level meetings are regularly held.

But assurances from the Belgian government that the show could go on convinced Herman Van Rompuy, who chairs the summits, to push ahead. As a Belgian who championed (and partly enacted as premier) the reforms that are being disputed, he was perhaps unlikely to yield to the street.

“Inside the building, it will be business as usual,” the source said. The subtext is that outside the Justus Lipsius venue it will be impossible to get to Brussels, find a taxi or even a sandwich.

Obama shakes hands with Treasury chief Geithner after his State of the Union address.

The news overnight focused on President Barack Obama’s annual State of the Union address. For the Brussels crowd, the most interesting thing in the speech may have been what was not in the speech: Europe.

Despite the ongoing eurozone crisis, and the increasingly deep involvement of senior US officials like Treasury secretary Timothy Geithner in crisis management, Obama did not mention Europe’s economic problems once. In fact, his only reference to the continent at all was a line that military alliances in Europe (and Asia) were “as strong as ever”, and putting “Berlin” in a list of global capitals where governments are “eager to work with us”.

Obama’s Republican adversaries have not done much more than that in their frequent televised debates, despite growing concern in Washington that a crisis-induced collapse of Europe’s economy could have a severe impact on the US economy in the midst of this year’s presidential campaign.

EU commissioner Neelie Kroes

Viktor Orban is in Brussels today on the second part of a charm offensive designed to cool tensions between Budapest and the European Union.

Last week he flattered the European parliament by dropping in on its second home in Strasbourg to reassure MEPs that the sweeping reforms his government are currently undertaking are in line with fundamental European values.

But one commissioner at least is standing firm against the Orban’s overtures, and in a very public way. Just hours before Orban was to meet Jose Manuel Barroso, the Commission president, Neelie Kroes, the commissioner who oversees media issues, held talks in Brussels with the management at Klubradio, a talk and news station which is no fan of the Fidesz government. Since Orban came to power in 2010, it has had a knack of losing out in radio frequency allocation rounds, which it says is an attempt to muzzle dissident voices.

After the meeting, Kroes tweeted to her 33,876 followers:

Just met CEO of #Klubradio, incredible shrinking radio station in #Hungary - 8 local frequencies lost in 2011 #media http://t.co/LNxkCb4h
@NeelieKroesEU
Neelie Kroes

Hungarian prime minister Viktor Orban listens to MEPs during Wednesday's debate in Strasbourg

The buzz around Brussels since Viktor Orban’s appearance before the European parliament Wednesday has been that the Hungarian prime minister got the better of the parliamentarians, coming across as conciliatory and reasonable in the face of occasionally hectoring MEPs.

But Hungary’s troubles in Brussels are far from over. In addition to continued European Commission resistance to giving Budapest much-needed financial aid until it overhauls a new law critics believe threatens the independence of the central bank – a topic of discussion today when Hungary’s lead negotiator meets in Brussels with Olli Rehn, the Commission’s economic chief – next week is going to be a rough one for Orban’s government.

Most unexpectedly, the three Benelux countries – Belgium, Netherlands and Luxembourg – have asked that Hungary be discussed at Friday’s meeting in Brussels of all 27 national Europe ministers. Although no decisions will be taken, the move for the first time takes the Hungarian issue from the realm of EU technocrats to that of national politicians, where things could get more heated.

Viktor Orban, Hungarian prime minister. AFP/Getty Images

Viktor Orban, Hungarian prime minister. AFP/Getty Images

Welcome to our live coverage of Hungarian prime minister Viktor Orban’s appearance before the European parliament, where he intends to defend his government’s recent actions against accusations they are anti-democratic. All times are GMT.

The Brussels Blog’s Peter Spiegel in Brussels and Stanley Pignal in the parliament’s second home in Strasbourg will be anchoring coverage, with contributions from other FT reporters who write about central and eastern Europe.

Hungary's Viktor Orban during his address in Strasbourg last year. Brussels Blog will be live blogging his appearance on Wednesday .

Viktor Orban, Hungary’s combative prime minister, already had a lengthy list of Brussels’ critiques to rebut during an address today at the European parliament in Strasbourg, which the Brussels Blog is planning to live blog when it begins at 3pm local time.

Expectations are high after last year’s rowdy appearance, and the list of particulars has only grown in the last 24 hours: the European commission, the European Union’s executive arm, on Tuesday declared three new Hungarian laws in violation of the EU treaties, and warned that one may threaten the independence of the country’s central bank.

Just this morning, however, the commission added to the list again, hitting out at Orban – who prides himself on ridding his country from Soviet communism – for failing to respect “media freedom and media pluralism”, the same criticism he faced in Strasbourg a year ago.

Brussels blog

Notes from the EU

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Contact the Brussels blog team: Peter Spiegel, Joshua Chaffin, Alex Barker and Stanley Pignal.

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Peter Spiegel is the FT's Brussels bureau chief. He returned to the FT in August 2010 after spending five years covering foreign policy and national security issues from Washington for the Wall Street Journal and the Los Angeles Times, focusing on the wars in Iraq and Afghanistan. He first joined the FT in 1999 covering business regulation and corporate crime in its Washington bureau, before spending four years covering military affairs and the defence industry in London and Washington.

Joshua Chaffin is one of the FT's EU correspondents, covering areas including policies on trade, the environment and energy. He has worked in the FT's Brussels bureau since late 2008 and before that was an FT correspondent in New York and Washington DC.

Alex Barker is EU correspondent, covering the single market, financial regulation and competition. He was formerly an FT political correspondent in the UK and joined the FT in 2005.

Stanley Pignal is Brussels correspondent for the Financial Times, covering EU justice, home affairs, social developments, telecoms and the Benelux region. He joined the bureau in January 2009, having previously worked for the FT as a corporate reporter in London.

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