Atlantic Update 5/11/11


German Foreign Minister Guido Westerwelle backs EU foreign relations chief Catherine Ashton, as Lady Ashton opens a diplomatic mission in Benghazi and overseas the imposition of a Syrian arms embargo. Brussels might just come out ahead in its emergency loans to Portugal, however with riots hitting the streets in Greece, it is clear the financial trouble for Europe is far from over.


European Union Imposes Arms Embargo on Syria (Defense News)

An arms embargo imposed on Syria May 9 by the European Union applies to weapons, ammunition, military vehicles and equipment, paramilitary equipment and spare parts. It also covers equipment of this kind that might be used for internal repression.

EU to open office in Libyan rebel stronghold (EUobserver)

EU foreign relations chief Catherine Ashton has said she will open a diplomatic mission in the stronghold of the Transitional National Council (TNC), a parallel government formed by anti-Gaddafi rebels in Libya. "I intend to open an office in Benghazi so that we can move forward on the support we have discussed with the people, to support civil society, to support the interim national council and Mr Jebril [a leading TNC member], and there’s many meetings I’ve had with him, and to support security sector reform," Ashton told MEPs in Strasbourg on Wednesday (11 May).

Westerwelle Backs Ashton (European Voice)

Germany’s foreign minister rebuffs Belgian critique of the EU’s foreign policy chief. Guido Westerwelle, Germany’s foreign minister, has expressed strong support for Catherine Ashton, the EU’s foreign policy chief, rejecting recent criticism by Belgium’s foreign minister. Speaking to journalists in Berlin today (10 May), Westerwelle said: “She has our full support and especially my personal support.”


Russia, Norway to begin naval drills (RIA Novosti)

Russia and Norway will begin a joint large-scale naval exercise, Pomor-2011, on Wednesday, a spokesman for Russia’s Northern Fleet said. The six-day exercise in the Barents and Norwegian seas will involve Russian Udaloy class destroyer Vice Admiral Kulakov from the Northern Fleet, Norwegian Fridtjof Nansen class frigate Helge Ingstad, as well as coastal guard vessels and naval aircraft.

Barroso: Schengen reform is not ‘knee-jerk’ reaction (Euractiv)

Seeking to strike a balance between France and Italy’s calls for border controls within the Schengen border-free area to be reintroduced on demand and federalist views, according to which such a move would undermine the EU, European Commission President José Manuel Barroso admitted that such checks could be reinstated as "a last resort".

Brussels wants to halve recipients of EU trade benefits (EUobserver)

The European Commission has published proposals to slash the number of countries benefiting from preferential EU trade concessions in half, prompting a quick reaction from certain states likely to suffer repercussions. Announcing the plans in Strasbourg on Tuesday evening (10 May), EU trade commissioner Karel De Gucht said cutting the number of states which benefit from the EU’s Generalised System of Preferences (GSP) scheme from 176 to around 80 would help target the trade support measures towards countries most in need.

Berlin Forced to Consider Taking a Stake in EADS (Spiegel)

Daimler wants to sell its shares in the European aerospace corporation EADS. But some are concerned that, without a signficant stake in German hands, domestic jobs could be lost. Berlin is faced with a choice: Should the government buy a stake in the Airbus parent company?

EU to gain 1.3 billion from Portugal bailout (Correio da Manhã)

"Euribor rise punishes interest rate Portugal will pay EU", headlines Público, adding that the interest rate varying between 5.5 and 6 percent, is higher than Ireland’s. The rate was announced on May 10 by Commissioner Olli Rehn after the European Commission validated the Portuguese financial aid programme. The Lisbon daily notes that the exact value will be established by European finance ministers on 16 May, when the whole package is expected to be approved. Correio da Manhã, another Portuguese daily, adds that Brussels will garner an annual 1.3 billion euro profit on bailout. (Full text in Portuguese)

Athens police use tear gas as strike hits Greece (BBC News)

Police in Athens have fired tear gas to disperse stone-throwing demonstrators during a protest march against government austerity measures.

Germany braces to answer Athens’ call (Handelsblatt)

“The impossible rescue,” leads Handelsblatt as Greece gets ready yet again to send out a distress call for more financial aid. Impossible, says the Düsseldorf daily, noting that the initiatives taken so far have failed one after the other, without any lessons having been drawn. In May 2010, 110 billion euros were allocated to Greece to stabilise its economy – “but stability hasn’t happened.” In March 2011 the loan repayments were extended from three years to seven and a half years to calm the markets – “but the markets haven’t lost the jitters.” On May 10, Chancellor Angela Merkel announced again, in a “gesture of despair”, that action must be taken “for a stronger Greece”. The Chancellor, however, seems deaf to “the fundamental experience of this past year. For the measures – in fact, credits worth billions – have not worked. The road for those who want to save the Greeks leads nowhere. […] And yet the usual cavalry” – the IMF and the European Central Bank – “are already heading back to Athens” to discuss an extension of credit of approximately 60 billion euros and a new repayment deadline, which would stretch the seven and a half years to ten, the economic daily reports. “Once again, we want to stabilise Greece by combining a brutal austerity with billions in credits. This kind of help just deepens the crisis,” Handelsblatt concludes.(Full text in German)


Referendum on the euro (Die Zeitg)

Just as American economists have predicted, the euro has become a divisive rather than a unifying force in Europe, remarks Die Zeit. "The North no longer wants to be paymaster, while the South wants to get rid of its taskmaster.” From a German perspective, German tax revenue is financing a life of luxury in Ireland, while the Irish complain that they are being forced to cut costs to save German banks. Eurosceptic parties are doing better than ever, as are nationalists, populists and other Cassandras. "History is not a linear process," warns the Hamburg daily, and "Europe could fall apart in the same way that it was united, if it remains an elitist project that does not involve Europe’s citizens, which is not on the agenda for proper democratic debate." (Full text in German)


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