EU-DIGEST NEWS WRAP-UP: EUROPE ON THE EVE OF THE JUNE 2007 EU SUMMIT - by Rick Morren

A Special report from EU-Digest

EU-DIGEST NEWS WRAP-UP: EUROPE ON THE EVE OF THE JUNE 2007 EU SUMMIT - by Rick Morren - Wednesday, June 20, 2007

Economy: Just over half of EU citizens are optimistic about their national economies, according to a European Commission poll, a summary of which was released on Monday. The poll also showed that 57% of E.U. citizens think their country's membership of the E.U. is a good thing, up four percentage points from the last Eurobarometer survey in the autumn 2006. That's the highest percentage of pro-European sentiment recorded since 1994, the commission said. But a majority of those surveyed said they wanted the E.U. to take more action to fight climate change. The German economy's strong performance is a key reason for economic optimism, the commission said, with 74% of Germans polled saying the economy was performing well. This was up 31 percentage points from the last survey in the autumn of 2006. Inflation holds steady in the Euro zone at 1.9% as labor costs rise by 2.2 %. Unemployment falls to its lowest level ever at 7%. Although 3.8 million Germans are on the dole, the country's recent growth spurt has left businesses unable to fill 600,000 vacancies, including many high-skilled jobs. Among them are 48,000 missing engineers, whose absence last year cost Germany about €3.5 billion ($4.6 billion) in lost annual output. Germany and the Netherlands have followed Spain by passing legislation providing amnesty to long-term illegal immigrants (the Netherlands) and allowing illegal immigrants to stay legally if they can find jobs (Germany). Great job opportunities are opening up all over Europe for skilled and unskilled workers. Unfortunately without more liberal EU immigration policies the present economic development of the EU can not be sustained.

European Constitution: Public backing for the EU has risen sharply to its highest level since the 1990s, providing a positive backdrop for what threatens to be a difficult Brussels summit starting on Thursday writes the Financial Times today. Some 47 percent European Union citizens are in favor of greater political leadership in the 27-member body EU, according to a new poll released Tuesday by the German Bertelsmann Foundation, a political think tank. On the other hand the Polish Government seems to be sabotaging the European Union integration process and blocking progress toward the new EU Constitution with unreasonable demands. Some believe Poland is doing this to get a stronger negotiating position during the EU summit starting tomorrow. In the meantime Germany's Chancellor Angela Merkel has indicated that she will not accept demands by Poland to maximize its power in an expanded European Union. The treaty requires approval by all 27 EU members and Poland has indicated it will block the treaty unless the proposed new voting system is adjusted. What Poland is asking for is less of a gap in the weighting of votes for countries with large populations versus smaller ones. The new voting system would be similar to the US Congressional voting system. Poland is a medium sized nation and has complained that the proposed rules favor larger nations, giving them too much political power. Several studies on Poland's membership in the EU have show that Poland has greatly benefited from its membership in the Union. Poland's present demands are considered unreasonable by the majority of the EU member states and they say that Poland's positioning indicates a lack of understanding of the basic rules which govern a political and economic partnership. So far the eastern expansion of the EU has caused far more political headaches than the EU had bargained for. Among some of the other problems that are coming to the surface, and causing cracks in the EU, is the fact that some of the eastern European EU member states have been acting unilaterally in accepting the stationing of US missiles in their backyards, even against the wishes of their own populations. Consequently eastern European EU member Governments are moving against a EU constitution, which if implemented will impose more stringent rules on member nations as to their foreign affairs and military involvements, and enforcing this by majority vote. Great Britain is also seen as backing the eastern Europeans in their efforts to create a politically weaker EU. which is more dependent on US policies. The scale of the challenge facing Mr. Blair became clear as it emerged that Germany's proposals would breach three of his so-called "red lines". The proposals are for the Charter of Fundamental Rights to be given full legal force over the law of member states, for measures that could threaten Britain's independent foreign policy and for an end to their veto on justice and home affairs. Germany and France supported by at least 17 of the other 27 EU nation states are for a stronger, more unified union. The EU now has a total population of nearly half a billion people. The bottom-line seems to be that the EU can not survive much longer without a constitution which provides for institutional reforms, abolishes the veto in exchange for majority vote, stronger European parliamentary powers, a universally elected President, with his own cabinet, including a foreign minister who can speak with one voice for all 27 member nations. If Mrs. Merkel pulls off this nearly impossible feat, Europe could well be at the beginning of a new Golden Age.

Energy: Ever since Russia's gas monopolist, Gazprom, cut supplies to Ukraine during a pricing dispute in January 2006, debate has raged over the best way to ensure gas security in Europe. According to Gazprom's figures, the company supplies almost a third of Europe's gas imports. In much of Eastern Europe - including Finland, the Baltic states and Poland - it is the sole supplier. "Diversity and security of energy supplies are vital ... When national security is at stake, no costs are too high," EU Energy Commissioner Andris Piebalgs told a Baltic Regional Energy Forum. The EU is in dire need of a common energy policy to stop the present Russian game of divide and conquer and deal with the Russians on an even playing field.

Security and personal data protection: Under a new EU law, travelers entering or leaving the EU will be required as of June 15 to declare sums of €10,000 or more. "The new rules will make it more difficult for terrorists to enter or leave the Community with the cash required to finance their illegal actions", said Taxation and Customs Commissioner László Kovács. The EU has earmarked around 138m EUR for the period for specific Program ‘Prevention, Preparedness and Consequence Management of Terrorism and other Security related risks’. This is part of the general EU program on security and safeguarding liberties. A controversial issue remains that of the Kurdish terrorist organization PKK who have caused thousands of innocent civilian deaths in Turkey and in other European countries. U.S. and E.U. laws both consider the PKK a terrorist organization but are not acting seriously on enforcing the law on the terrorist Organization. According to the British MI5 reports, the PKK is one of the most deadly terrorist organizations in the world. However the PKK is allowed to maintain armed terror bases in Iraq under American occupation and propaganda offices in many E.U. capitals including Denmark, Belgium and in many other Western European cities. PKK for some reason has been considered privileged terrorist organization in some European nations. In the past Greece and Cyprus openly supported the PKK activities. When the PKK leader Abdullah Ocalan was captured in the Greek Embassy in Kenya, he was in possession of a Greek Cypriot passport. Today a EU spokesman said the EU and the US have reached a preliminary deal on how U.S. authorities can consult data from the international banking network SWIFT in anti-terror investigations. No details were given but the spokesman said the deal included provisions on data protection. Google may have some explaining to do to EU regulators who are looking into whether the search giant's privacy policy complies with the law. Google typically stores information on user queries -- including search terms, server addresses and information on cookies -- for up to two years.

Environment: Greenhouse-gas (GHG) emissions decreased by 0.8% in 2005, according to an annual report by the European Environment Agency (EEA). While the Commission welcomed the decrease and called for more action, environmental groups saw the modest figure as a sign that the EU is not likely to achieve the emission-reduction targets agreed in Kyoto in 1992. The overall emissions reduction appears to be largely the work of a handful of member states, notably Finland, Romania, the Netherlands and Germany. Finland led the way with a 14.6% reduction, with Romania achieving 4% and the Netherlands and Germany achieving 2.9% and 2.3% respectively. In order for the EU to meet its Kyoto target, the EU-15 states would have had to reduce emissions by 6% in 2005, more than three times the actual reduction achieved, but Brussels remains positive that the EU will reach its Kyoto commitments.

Space: Europe unveiled a space plane for the tourist Market at the Paris Air show: EADS's Astrium division, prime contractor for Ariane 5 rockets and for Europe's contribution to the international space station, said a group of its engineers has spent two years quietly designing a vehicle that looks like a business jet with exceptionally long wings and a rocket engine powered by liquid methane and liquid oxygen.