EU-US Trade Pact: Poll shows majority of Europeans not in favor of all aspects potential EU - US trade agreement

A recent EU-Digest poll conducted from  May through June as to EU citizens concerns related to a potential Trans Atlantic Trade Pact  (TTIP) between the EU and the EU shows that all respondents in this poll voiced concerns about the possibility that this EU-US trade pact could be providing US corporations access/controls over EU Public Health, Communications, Education, Insurance, Water and Energy services.

A new EU-Digest poll, which runs from the 27th of June till the end of July focuses on the overall state of "health" of the EU, given the challenges it faces and its ability to tackle these problems,

The new EU-Digest poll is also quite relevant, given the possibility of a Greek economic default and the impact it could have on the EMU and the EU as a whole.

EU-Digest 

Europe - Greece bailout talks end without deal, says EU

Crunch bailout talks between Greece and its EU-IMF creditors ended without a deal on Sunday, with a "significant gap" still remaining, a European Commission spokesman told AFP.

"While some progress was made the talks did not succeed as there remains a significant gap between the plans of the Greek authorities and the joint requirements of the Commission, ECB and IMF," said the spokesman from the EU's executive, referring to the three institutions that oversee Greece's huge bailout.

The Greek proposal "remains incomplete", the source said, saying it fell short of providing the necessary reforms to unlock the 7.2 billion euros ($8.1 billion) still remaining in Greece's international bailout, which expires June 30.

Read more; Europe - Greece bailout talks end without deal, says EU - France 24

Greece: In order to save Greece and the EMU the EU might have to dump Ukraine

Greece failed to reach an initial deal with the European Union and the IMF to unlock aid after the creditors dismissed a package of reforms from Athens as ideas rather than a concrete plan, officials said on Tuesday.
The lack of a deal further raises pressure on Athens, which faces the prospect of running out of money in a few weeks unless it can convince lenders to dole out more financial help.

Athens put a brave face on the failure to reach an agreement with the "Brussels Group" of representatives from the EU and the IMF, saying it remained keen for a deal on the basis of its long-held demand that the measures it is asked to implement do not hurt economic growth. Lenders will intensify efforts to collect data in Athens, it said.

he country’s immediate fate now hinges dangerously upon a colourful but corrosive personality struggle. Prime Minister Alexis Tsipras’s charm has worn thin, and so has Finance Minister Yanis Varoufakis’s charisma. Mr. Varoufakis is visibly despised by his German counterpart, Wolfgang Schaeuble, though the latter is no match for him in wit and lucidity.

Mr. Schaeuble is more or less in tune with his boss, Chancellor Angela Merkel, but both are at loggerheads with Jean-Claude Juncker, the new President of the European Commission in Brussels. Mario Draghi, president of the European Central Bank, is in conflict with Jens Weidmann, president of the German Bundesbank. The Prime Minister of Spain, fearful of a challenge from his leftist opposition, is openly derisive of the new Greek government, and even the socialist leaders of Italy and France are keeping their distance.

The root cause of this personality struggle is the merit of so called “austerity” as a remedy for indebtedness. Under German leadership, the European Union has imposed spending cutbacks on Greece that are the most severe in postwar history: the outcome has been the most prolonged economic contraction and highest unemployment in Europe’s postwar history.

In order to save  Greece the EU might even have toi go as far as cancelling its planned investments in Ukraine and offer Ukraine as a gift to Russia thereby guaranteeing stability in the EMU and the survival of the EU if the US likes it or not..

EU-Digest

Global Economy: Why EM currencies matter to every investor - by Alex Rosenberg

Currencies like the Turkish lira and the Brazilian real may not always be foremost on investors' minds.
But according to Scotiabank's chief FX strategist, Camilla Sutton, emerging market currencies are sending powerful signals about what the U.S. dollar will do next—and could convey a loud message to the Federal Reserve.

As the dollar has surged this year and oil has continued to crumble, emerging market currencies have felt the pain. The real has fallen 16 percent against the dollar year to date, dropping nearly a full percent on Tuesday alone—a huge move for a currency.

The lira has been another big decliner, retreating 1.2 percent against the dollar on Tuesday, for a 13 percent drop on the year. And the Mexican peso is at all-time lows against the greenback.

Obscure as these moves might sound, Sutton says that if they intensify, they could actually cause the Fed to delay rate rises.

Read more: Why EM currencies matter to every investor: FX pro

EMU: Paul Krugman: "Stop listening to the deficit scolds — they’ve lost all credibility"

Five years after the country embarked on a harsh, internationally-imposed austerity regime, Greece suffers from sky-high unemployment and plummeting wages.

Moreover, Krugman notes, the country’s debt-to-GDP ratio has actually gotten worse, largely because dramatic cutbacks have sent Greek GDP plunging.

Amid this sorry economic climate, the Greek ruling class could soon face a reckoning. As Krugman writes, polls show the left-wing anti-austerity party Syriza poised to win control in a general election, which the center-right government is desperately trying to avoid.

While Syriza avoids the xenophobia and extremism that define other anti-establishment parties in Europe, Krugman observes that its rise has occurred as extremist parties like France’s National Front and Italy’s Northern League have seen their political fortunes improve.

“This is what happens when an elite claims the right to rule based on its supposed expertise, its understanding of what must be done — then demonstrates both that it does not, in fact, know what it is doing, and that it is too ideologically rigid to learn from its mistakes,” Krugman writes.

Therein lies the real lesson Greece provides.

Read more: Paul Krugman: Stop listening to the deficit scolds — they’ve lost all credibility - Salon.com

How Greece pulled back from the brink of plunging Europe into chaos - Helena Smith

It was a meal where only four of the 14 participants spoke and nobody ate. Seated in front of crystal glasses, the finest porcelain laid out before them, the German chancellor, Angela Merkel, and her French counterpart, Nicolas Sarkozy, glared at the two men on the opposite side of the table. For both leaders, entrapped in Europe's escalating debt crisis, the emergency dinner – conducted on the sidelines of the G20 summit in Cannes in November 2011 – had suddenly become a defining moment that could make or break the eurozone, the EU's most ambitious project.

Greece had never come closer to euro exit, and united Europe had never come closer to collapse. "In all my years I have never witnessed behaviour so undiplomatic," recalled Evangelos Venizelos, Greece's deputy prime minister who along with the then PM, George Papandreou, was the focus of Merkel's frosty glare.

"The climate was extremely heavy, absolutely tragic," he conceded in an exclusive interview. "And very, very aggressive."

As EU states head to the polls – amid concerns that political instability might yet open a new chapter in the eurozone crisis – revelations about just how close Greece came to being forced out of the euro have finally begun to emerge.

The disclosures have been grist to the mill of an anti-austerity opposition determined to prove that Athens had almost no say in the running of its affairs.

Papandreou had dug in his heels and, emerging from the meeting, announced the referendum would go ahead. Meanwhile, unbeknown to the Greek leader, Merkel and Sarkozy had held a joint press conference declaring that Greece had one choice, and it was "in or out" of the entire euro project.

As the prime minister's jet flew back to Athens with Papandreou slumped in his seat asleep, Venizelos worked on a statement that would ultimately be the beginning of the end of the referendum.

Within minutes of landing his eight-paragraph announcement was released. "Greece's position within the euro is a historic conquest that cannot be questioned," said the announcement. "This acquis by the Greek people cannot depend on a referendum."

It was 4.45am – barely three hours before the banks in Greece opened and nine hours after the start of the meal in Cannes. The eurozone's darkest hour was over.

Read more: How Greece pulled back from the brink of plunging Europe into chaos | World news | The Guardian

Portugal: Buoyed by Exports, Portugal Chooses Clean Exit From Bailout - by Raphael Minder

Portugal on Sunday announced its exit from a three-year bailout program that has forced deep spending cuts and set off mass protests — but has also helped the country clean up its public finances and return to the bond markets after halving its budget deficit.

Prime Minister Pedro Passos Coelho said that Portugal had built up sufficient financial reserves to end the program on schedule and without requesting any additional line of credit from its European counterparts. Such a line of credit would have acted as a safety net if the country again struggled to meet its debt financing obligations.

The decision to fully exit the program comes after Portugal’s international lenders — the International Monetary Fund, the European Commission and the European Central Bank — on Friday issued a positive assessment of the country’s progress. Portugal, which was particularly scarred by the European debt crisis, received a bailout of 78 billion euros, or about $108 billion, three years ago.

“With the recovery of our autonomy, Portugal will be on an equal footing with the other member states” of the European Union, Mr. Passos Coelho said in a televised address on Sunday evening, flanked by his ministers.

Read more: Buoyed by Exports, Portugal Chooses Clean Exit From Bailout - NYTimes.com

EU still wrangling over banking union

The European Union is still treading water on the thorny issue of a community-wide banking union. EU finance ministers, gathered once again in Brussels, aren't making any decisions; instead, they're just repeating well-worn positions that haven't change in months.

According to EU diplomats, that is the fault of the German government, which is unwilling to shift its ground while coalition negotiations over the next new government are still going on in Berlin.

But Germany's incumbent Finance Minister Wolfgang Schäuble, of Angela Merkel's conservative Christian Democratic Union, has another view: "The German government is fully capable of acting," he said, because all the parties in the country's future government agree on European policy.

EU still wrangling over banking union | Europe | DW.DE | 15.11.2013

Germany Digs In Against Risk Sharing in EU Bank-Failure Plan - by Rebecca Christie and Rainer Buergi

Germany argued against a joint backstop for struggling euro-area banks as European finance ministers renewed their debate on how to handle the costs of managing failed lenders.

German Finance Minister Wolfgang Schaeuble called on his colleagues to rein in their ambitions for the Single Resolution Mechanism proposed by the European Commission, which includes a common fund filled by levies on the financial industry. While an agreement is unlikely today, it can be achieved by year-end as long as among European Union member states don’t insist on a joint fund immediately, he said.

“It’s not disputed in principle that we need a European fund,” Schaeuble told reporters yesterday at the start of two days of talks in Brussels. “A fund needs a levy” on banks, “but the levy needs a clear legal basis. There are different opinions on that, but if you want a safe legal basis, you’d better take the safe route.”

Finance ministers are racing to meet a year-end deadline to reach a common position on the bank-failure plan so that a final agreement on the legislation with the European Parliament is possible before the assembly stops work before elections in May. The European Central Bank, which takes over euro-area financial supervision next year, wants a European resolution mechanism in place as soon as possible after it begins oversight.

Read more: Germany Digs In Against Risk Sharing in EU Bank-Failure Plan - SFGate

Banking Union: EU leaders to set tight timetable on completing banking union

European leaders will confirmed  Friday the 24th an ambitious timetable for the completion of a banking union, Europe's biggest project since the euro, and set a December deadline for fleshing out the idea of rewards for structural reforms in the euro zone.

Policy-makers believe a banking union in the 18 countries that will share the euro from next year will help increase the flow of credit, boost growth and help prevent financial crises in the future.

Under the union, the European Central Bank will directly supervise the euro zone's 130 biggest banks from November 2014 and have the power to take over supervision of any of the smaller banks if needed.

Such a Single Supervision Mechanism is to be accompanied by a Single Resolution Mechanism (SRM) - a yet-to-be-created euro zone authority with its own fund that would decide how to wind down or restructure banks that are no longer viable.

Read more: EU leaders to set tight timetable on completing banking union | Reuters

EMU: Retail revivals show that Europe is on the mend - by Dominique Vidalon and Emma Thomasson

Quarterly sales at two of Europe’s biggest retailers, Carrefour and Metro, showed turnaround efforts in their home markets starting to bear fruit and signs the region’s long-suffering economy is at last on the mend.

European store groups have had a torrid few years, hit by a squeeze on disposable incomes from a prolonged economic downturn and cut-throat competition from the rise of online shopping.

Carrefour, which has particularly suffered from its focus on out-of-town megastores, said on Thursday hypermarkets in its main French market had returned to underlying sales growth for the first time in five-and-a-half-years, helped by its drive to cut costs, improve price competitiveness and revamp stores.

Germany’s Metro, which has also been restructuring, said it was growing again in its home market of Germany and was upbeat for the key Christmas period despite a blow to third-quarter sales from volatile foreign exchange rates.

As well as reflecting self-help measures, the results add to signs the eurozone economy is returning to life after years in the doldrums.

Retail sales in the 17-country EMU bloc rose more than expected in August.

But the stronger performances at Carrefour and Metro contrast with results this month from Britain’s Tesco, where plunging profits in Central and Eastern Europe blew a hole in its recovery plan.

Carrefour, the world’s second-largest retailer by sales behind US group Walmart, said it made third-quarter sales of €21.11bn ($28.48bn), representing like-for-like growth of 3.1%, excluding fuel.

Read more: Retail revivals show that Europe is on mend | Europe | BDlive

Global Economy: Economic storm clouds shift from Europe to Asia - by Glenda Kwek, Clancy Yeates, Eric Johnston

The fissures that have been quietly spreading through some of Asia's economies over recent months are now shaping up as yawning cracks. Emerging markets from Thailand to India plunged into the red amid a heavy sell-off, as investors reassessed the implications of another shift in the global economy.

India's currency, the rupee, has fallen to record lows against the US dollar. Currencies from Brazil and South Africa were also pummelled as investors fled back into US and European markets.

As the US Federal Reserve mulls winding back its super loose monetary policy, Asia is now faced with the prospect that the tap of cheap debt will be turned off.

The realization of an end to the lavish spending that has been driving growth through the region has started to upend markets. In doing so, it has stoked memories of the bushfire that was the 1997 Asian financial crisis.

Advertisement

More worrying, some argue that if growth through Asia stalls, this could have serious implications for Australia, particularly as banks and miners have pushed deeper into the region over the past decade.

The Fed is tipped to begin winding back its $US85 billion-a-month stimulus program as early as next month, and currency flows are being turned upside down, moving out of emerging markets such as Brazil, India, Indonesia and South Africa and back to old world economies of the northern hemisphere.

n contrast to the events of Asia, the severe slowdown in Europe has improved external balances and led to a large current account surplus for the euro.

Flows into European stocks hit a two-month high of $US755 million last week, figures from funds tracker Lipper show.

It was the largest inflow since mid-June, when a record $US1.17 billion was reached.
In the year to date, France's CAC 40 has risen 11.5 per cent, Germany's DAX 10 per cent, and Britain's FTSE 100 9.3 per cent.

In comparison, Hong Kong's Hang Seng has fallen 2.7 per cent, India's Sensex 5.7 per cent and Jakarta's index 2.2 per cent. Australia's S&P/ASX200 is up 10.4 per cent.

Read more: Economic storm clouds shift from Europe to Asia

European Economy On The Rise

European shares were broadly higher on Thursday, rebounding after several days of losses, as upbeat data from Europe and China offset negative sentiment in global markets on Fed "tapering" fears.

The FTSEurofirst 300 Index rose as Germany and the euro zone bloc posted better-than-expected flash estimates for business sector activity in August.

The composite figure for Germany climbed to 53.4 in August from 52.1 in July. The DAX surged higher on the news, trading over 1 percent higher, with the euro also climbing against the dollar.The figures for the euro zone also beat expectations with the composite number rising to 51.7 in August against 50.5 for July.

"They're certainly good numbers and we've been seeing this for the last four or five months in Europe," Richard Jerram, chief economist at the Bank of Singapore, told CNBC. "It does seem that as the headwinds from fiscal tightening fade then the economies are starting to lift."

Read more: Europe holds onto strong gains as data beats

European Stock Markets Outperforming Wall Street - by Wanfeng Zhou

European stock markets have outperformed their U.S. counterparts lately as signs grew that the region's economy has finally turned the corner. But they are still lagging U.S. shares, which have hit record highs for the year to date.

"There is some talk of global money arriving in Europe as Europe claws its way out of recession," said Rupert Baker, a European equity sales executive at Mirabaud Securities.

Read more: Wall Street ends down on Fed uncertainty; data boosts Europe | Reuters

France - Glimmers of economic growth hope peep through recession in France

A glimmer of hope that France may edge out of recession in the next three months came from the central bank on Aug. 7, the day after President Francois Hollande repeated that recovery was on the way.

The Bank of France said in a first estimate that the economy, which is stumbling along just below the line between recession and expansion, was set to edge into growth of 0.1 percent in the third quarter of the year.

The overall picture for France is mixed but appears to be trailing the trend in the eurozone and Britain. The latest forecast, coupled with some other recent signs, is broadly in line with data showing that the eurozone is emerging from recession.

Read more: ECONOMICS - Glimmers of economic growth hope peep through recession in France

Europe Is Heading Toward Recovery, but Slowly - by Charles Forelle

Europe's longest recession since World War II appears to be on the verge of ending, driven by a surge in German growth that is helping to blunt the severe economic pain faced by many in the region, but is too modest to lift the global outlook.

A string of recent economic data, including a robust German industrial production report on Wednesday, has boosted hopes that the 17-member euro zone has returned to weak growth after six quarters of contraction. German industrial production in June jumped 2.4% from May, the country's economy ministry said Wednesday, beyond economists' expectations for a 0.3% gain.

The positive news from Germany followed an upbeat survey of purchasing managers in the euro zone last week and signs of slowing recessions in Italy and Spain—the region's third- and fourth-largest economies. Across the Channel, the Bank of England upgraded its growth forecasts on Wednesday. And Portuguese unemployment fell for the first time in two years.

Taken together, the data point to an imminent albeit weak German-led recovery, either in the second or third quarter, economists say. Euro-zone gross domestic product data for the second quarter are scheduled to be released Aug. 14

Read Europe Is Heading Toward Recovery, but Slowly - WSJ.com

European Automotive Market: Europe Sees Bottom of Downturn as Daimler Leads Rebound - Heather Harris

More than half of the companies in the benchmark Stoxx Europe 600 Index that have reported second-quarter sales so far topped analyst estimates. That’s up from about 40 percent in the prior quarter. While much of that was down to sales growth in North America and Asia, this time the fallout from Europe’s debt crisis didn’t overshadow those gains.

“France is holding up better than we would have thought six months ago,” said Xavier Huillard, chief executive officer of Vinci, Europe’s biggest construction company and operator of toll roads. “Traffic is often a leading indicator, and signs are that we have touched bottom and are recovering.”

The glimmer of optimism from CEOs adds to evidence from economic reports that the region emerges from a record-long recession, largely thanks to a recovery in Germany. European Central Bank President Mario Draghi yesterday said economic indicators signal the euro region is past the worst after euro-area manufacturing unexpectedly expanded in July for the first time in two years.

The region’s automakers, among companies hardest hit by the recession, say that while it may take many years to approach the peak level of sales in 2009, at least it won’t get any worse.

Europe Sees Bottom of Downturn as Daimler Leads Rebound - Bloomberg

Europe's Economy On The Mend: Europe's factories grow, China's stabilize - by Andy Bruce

Europe's factories delivered more signs last month the region is gradually leaving recession behind, according to business surveys that also eased immediate fears over the health of China's economy.

Thursday's purchasing managers indexes (PMIs), surveying thousands of manufacturers worldwide, showed output in British factories surged in July, and industrial activity in the euro zone rose for the first time in two years.

A report on the United States due later is expected to show a modest rate of growth in factories after the Federal Reserve said on Wednesday the world's biggest economy was recovering but would still need support.


Read more: Europe's factories grow, China's stabilize | Reuters

French Economy: Is France Heading South? - by Jeanne Park

Despite French president François Hollande's recent declaration that a recovery is under way, many policymakers continue to regard the country's troubled economy, the second-largest in the eurozone, as a growing liability for the troubled currency union. For Dominique Moïsi, special adviser at the French Institute for International Relations, the question is whether France has fundamentally shifted away from healthier countries in the North of Europe "and moved in the direction of its Southern European neighbors."

He describes Hollande as a moderate constrained from pursuing bold reforms by both his political left and eurozone requirements. Regarding nascent EU-U.S. free trade talks, he defends France's insistence on cultural exception, but believes that "the Asian challenge should force us to go beyond our differences."

Read more: Is France Heading South? - Council on Foreign Relations

EU-Economy: Is an end to Europe's misery in sight? by:Larry Elliott

The latest news from the eurozone is as upbeat as it has been for 18 months. Snapshots of activity in the manufacturing and services sectors are consistent with the long recession in the single currency area – which has been entrenched for the past six quarters – coming to an end. If the evidence from purchasing managers is to be believed, Germany is looking good and France is clawing its way back to normality.

A better performance by the eurozone's Big Two – accompanied by a lessening of recessionary pressure in Spain and Italy – should, with luck, eke out some growth across the region in the second half of 2013.

Analysts put the recent improvement down to the growth stimulus provided by the European Central Bank, the slower pace of austerity in 2013 compared with 2012, and the help that last year's pickup in the global economy provided to Europe's export-dependent economy.

So is this it? Are the PMIs (purchasing managers' indices) proof that an end to Europe's misery is at last in sight? The good news is that Wednesday's report was no flash in the pan: the eurozone PMIs have been improving for the past five months. It is also encouraging that the pace of job shedding is easing, given that record unemployment has been a significant drag on activity.

Read more: EU Economy: Is an end to Europe's misery in sight? | Larry Elliott | Business | guardian.co.uk