EU green deal is a 1 trln euro diversion 4 Mar 2020 The European Union’s big investment plan to cut emissions, due on Wednesday to be backed by legally binding targets, has been getting a kicking. Fair enough: it’s a typical Brussels fudge. Its main role is to keep the EU busy until political cover exists to properly price carbon.
EU offers Johnson a few crumbs in Brexit talks 3 Feb 2020 The bloc wants the United Kingdom to abide by its standards and state aid rules, and give up fishing rights, in return for a tariff-free trade deal. It’s hard to square with the prime minister’s goals. Yet Brussels has left some wiggle room. And Johnson has compromised before.
Shrinking GDP in Italy is bigger worry than France 31 Jan 2020 Two of the euro zone’s three biggest economies contracted in the fourth quarter. Gallic activity was hurt by strikes over President Emmanuel Macron’s pension reforms and inventory changes. Their impact will fade. The weakness of Italy’s domestic demand is a longer-term problem.
ECB gives banks a reason to sort themselves out 28 Jan 2020 Europe’s lenders have stronger balance sheets but aren’t very profitable, the regulator’s annual review shows. Executives blame low interest rates and strict capital rules, but these won’t change soon. If banks are too slow to cut costs or merge, they face even closer scrutiny.
Italy’s honeymoon with EU is under threat 22 Jan 2020 Luigi Di Maio looks set to step down as head of the 5-Star Movement, the largest party in the ruling coalition. That will strain the alliance. If a crucial regional election on Sunday produces a victory for eurosceptic Matteo Salvini, it may imperil the fragile pro-EU government.
Review: Greek crisis drama shows EU’s good and bad 10 Jan 2020 “The Last Bluff” tells how politicians and bureaucrats negotiated and bullied Alexis Tsipras, Greece’s prime minister, into submission in 2015. The book captures the strange excitement of complex negotiations, and the enduring appeal of the powerful but flawed European vision.
Euro zone bank rally is built on sand 9 Jan 2020 The bloc’s 20 largest lenders, such as BNP and ING, are worth $84 bln more than in October. Investors believe the ECB is now done with rate cuts, which squeeze profit. But renewed trade frictions could change such thinking. And rising capital requirements will weigh on returns.
Margrethe Vestager will open tech’s walled garden 20 Dec 2019 The European antitrust chief’s multibillion-dollar fines had little impact on the 12-digit market values of Google, Facebook and others. She will weaken their grip on the internet more effectively in 2020 by imposing common standards that allow seamless use of rival platforms.
Italy and Germany will unite on EU tech taxes 19 Dec 2019 New European Commission chief Ursula von der Leyen will struggle to persuade Rome and Berlin to compromise over much-needed euro zone banking reforms. Her best bet is to pick another battle. A levy on technology giants’ revenue may help the EU rivals find some common ground.
Johnson’s big win unlocks Brexit black box 12 Dec 2019 The UK’s Conservative Party has won a large parliamentary majority. That means Britain leaves the European Union, and gives the prime minister room to compromise on a quick trade deal. Stocks and the pound have bounced. Johnson’s broader policy ambitions remain a mystery.
ECB feuding will have a new front in coming year 11 Dec 2019 Christine Lagarde took the helm of the European Central Bank with a promise to review strategy. A debate on how to define its price stability mandate will embolden those rate setters who are fed up of ultra-loose policies. The battle will be bitter and played out in public.
EU single market is better exported than muzzled 4 Dec 2019 The Netherlands wants the European Union to apply state aid rules to companies backed by foreign governments. That would hike Chinese import prices. Yet Europe’s economic heft gives scope to negotiate, and is better than breaking EU rules to create Siemens-Alstom-style champions.
European banks get glimmer of regulatory hope 3 Dec 2019 The bloc’s lenders are in the doldrums, partly due to easy monetary policy. But UniCredit’s plans to return 8 billion euros to shareholders point to the benefits of a gentler regulatory approach to capital buffers. Purists may object, but there is a case for placating investors.
Wobbly German coalition will sap EU reform energy 2 Dec 2019 Chancellor Angela Merkel’s coalition partners, the Social Democrats, elected leaders who want to rethink the basis of the alliance. Failure to agree may lead to a minority government or early 2020 elections. That would slow progress on key projects like European banking union.
ECB decisions would benefit from a bit more light 11 Nov 2019 The central bank’s policy-making process is less formal and transparent than peers. New boss Christine Lagarde could change that by holding formal votes. Publishing the results, as the Fed does, would raise problems. But disclosing anonymous tallies would still be an improvement.
EU banking union needs more than German concession 6 Nov 2019 Finance Minister Olaf Scholz is willing to consider an EU deposit insurance scheme. Countries like Italy may balk at some of his conditions. That such a sensible plan can take so long to come to fruition shows how far Europe is from rational policy making on financial regulation.
EU can afford to act tough on carbon border taxes 5 Nov 2019 Brussels wants to levy the same tax on CO2 emissions in imports as on products made in the single market. Trading partners will carp about protectionism. But the EU has economic heft, precedents for a tight-door policy, and growing impetus for action. There’s scope to be bold.
UK election makes Halloween ghouls of capitalists 31 Oct 2019 Labour leader Jeremy Corbyn kicked off his campaign by attacking figures like retail tycoon Mike Ashley and hedge fund manager Crispin Odey. His radical message distracts from Labour’s fuzzy stance on Brexit, and tycoons have few defenders. They face a frightening few months.
Brexit election is answer to the wrong question 30 Oct 2019 The December poll is a flawed second referendum on Britain leaving the European Union. Prime Minister Boris Johnson needs a majority to push through his deal; other parties have to set aside rivalries to stop him. As in 2017, divided voters could deliver an inconclusive result.
Mario Draghi’s tacit advice to Christine Lagarde 24 Oct 2019 The outgoing ECB boss says his successor needs no guidance. But his last big news conference contained clues. First, never give up, though economic risks are rife. Second, turn the page on infighting. Third, be wary of financial bubbles. Fourth, expect brickbats, whatever you do.