EU breaks deadlock (by caving in to Hungary and Poland ?) on budget, coronavirus recovery fund

European Union leaders on Thursday reached agreement on a long-term budget and coronavirus recovery package, after weeks of resistance from Poland and Hungary, according to EU Council President Charles Michel.

"Now we can start with the implementation and build back our economies. Our landmark recovery package will drive forward our green and digital transitions,'' Michel said in a tweet.

No details of the agreement were immediately available, however ahead of the summit, EU diplomats and officials said there would likely be a declaration that the rule of law mechanism would only be used after a ruling from the European Court of Justice — a process that could take a year.

Read more at: EU breaks deadlock on budget, coronavirus recovery fund | News | DW | 10.12.2020

Spain: Spanish PM could end political impasse on weekend

Spanish lawmakers will this weekend begin debating whether to renew Pedro Sanchez as prime minister and end months of political deadlock in the major European Union country.

Read more at:
https://www.thelocal.es/20200101/spain-parliament-debate-could-end-political-impasse

Eurozone struggles to find joint response to Greek referendum - by Ian Traynor

Germany and France scrambled to avoid a major split over Greece on Monday evening as the eurozone delivered a damning verdict on Alexis Tsipras’s landslide referendum victory on Sunday and Angela Merkel demanded that the Greek prime minister put down new proposals to break the deadlock.

Read more: Eurozone struggles to find joint response to Greek referendum | Business | The Guardian

Greece: Weekend deadline for Greece after negotiations draw blank - by Ian Traynor, Jennifer Rankin, Helena Smith

Greece’s creditors have set the country a weekend deadline to avoid default and stay in the eurozone, after more than 24 hours of non-stop Brussels negotiations at the highest level resulted in stalemate.

After talks between Athens and its creditors failed to reach an agreement on Thursday, a further meeting of eurozone finance ministers will be held on Saturday in a bid to achieve a breakthrough. With the German chancellor Angela Merkel insisting that a deal must be reached before markets open on Monday morning, Greece is now running out of time to secure an accord and make a €1.6bn payment to the International Monetary Fund (IMF) on Tuesday.

Following a 24-hour period that involved three rounds of talks between Greek prime minister Alexis Tsipras and Greece’s creditors, as well as two sessions of eurozone finance ministers, officials described the situation as entrenched and immobilised.

“They can talk and talk, but the gap does not narrow,” said an EU official. “Both sides are in their trenches.” Arriving at an EU leaders’ summit on Thursday evening that threatened to be overshadowed by the Greek crisis, Merkel said Greece had “gone backwards” on some issues.

Read more: Weekend deadline for Greece after negotiations draw blank | Business | The Guardian

European Financial Industry: EU Finance Chiefs Struggle Over Deal on Handling Failing Banks - by Rebecca Christie, Jim Brunsden and Andrew Frye

European Union finance ministers struggled for consensus as they took up an Irish-drafted compromise proposal for assigning losses at failing banks, extending a deadlock that doomed talks last week.

The bloc’s 27 finance chiefs remained “quite far away” from agreement as they convened in Brussels at about 6 p.m. today, Sweden’s Anders Borg told reporters. Ireland’s Michael Noonan, chairing the meeting, held preliminary talks earlier to get a deal he says is key for keeping EU crisis-fighting on track.

“We can and even must reach an agreement,” French Finance Minister Pierre Moscovici said. It’s “indispensable” for France and Germany to “advance together to find a solution.”

Talks last week foundered on the question of which creditors face writedowns when banks fail. Some countries demanded more flexibility for national authorities, while others sought strict rules across all 27 EU nations. Ministers considered several ways to set thresholds for losses that would need to be assigned via strict formulas before national discretion would be allowed.

An updated plan, circulated by Ireland, a week away from the end of its six-month rotating EU presidency, would hand regulators different degrees of flexibility depending on how they plug gaps that arise when some creditors are exempted from writedowns.

Read more: EU Finance Chiefs Struggle Over Deal on Handling Failing Banks - SFGate