Would the DUP be any happier with a backstop, staying in the single market?

So it’s October then. The UK will fail to present its withdrawal plan to the EU summit at the end of the month and its backstop, handed in only after a cabinet crisis was averted on Thursday, would still lead to a hard border in Ireland. Lurking in the background may still be the option of some differentiation in NI’s status from GB. Such is the peculiar course of these negotiations, that the EU is mildly encouraged by the state … Read more

Special status for the North is a possibility from Barnier’s speech. Would the UK agree?

EU negotiator Michel Barnier and the Irish government seem to be inching their way towards special status – sorry – arrangements, for the North. The EU is there for you, Ireland and so is a close partnership with the UK based on a fair free trade agreement – but ( only!) after sufficient progress on EU citizens’ rights and the financial settlement. So declared Michel Barnier in a speech to the Oireachtas that seemed designed to calm the worst Irish … Read more

Does the EU have a referendum problem?

Eurosceptic hearts were gladdened last week, when they claimed victory in the referendum. Of course I’m referring to the Dutch referendum on the free-trade deal between the EU and the Ukraine, in which a majority of the minority who voted in the Netherlands on Wednesday, chose to reject the deal. Despite insisting that neither Dublin, Washington or anywhere else should tell you how to vote, on Europe, Nigel Farage even went and campaigned for a ‘No’ vote in the Netherlands … Read more

Sticking to the facts on Europe?

“On-balance” to use the first Minister’s language, the DUP’s call to vote to leave the EU is likely to be largely cost-free for her party. The vote which is now set for 23 June will come just seven weeks after the Stormont Assembly elections, will mark the end of a three year cycle of elections; local Councils, Westminster and the Assembly. The EU ballot may well therefore strike voters as an epilogue or afterthought to a 3 act play, rather … Read more

Cameron’s EU defeat: maybe De Gaulle was right all along

David Cameron’s failure to defeat the candidature of Jean-Claude Juncker has been variously described as a humiliation, a catastrophe for Britain, and an example of Cameron’s principle and European leaders cowardice. The Guardian’s Toby Helm has possibly the best analysis of what actually happened, why and how. It seems relatively few EU leaders were keen on Mr. Juncker’s appointment and that there was annoyance at a minor political coup by the EU parliament claiming that the result of the elections … Read more

Euro crisis: “When preserving the status quo is no longer a viable option…”

The Italian government is facing internal dissent over the terms and conditions of the European Central Bank’s “sticking plaster”.  Meanwhile, in the Irish Times, another supporter of the “European Project”, Thomas Klau, referencing the recent FT article by Otmar Issing I mentioned, at least identifies the fundamental area for discussion. In the English-language debate particularly, the relationship between democracy and European integration is often most vigorously argued about by Eurosceptics. It is essential for advocates of deeper European integration not … Read more

EU crisis: “the question is whether all this can be kept under control.”

EU leaders will discuss the proposed revision of the Schengen agreement at a summit next month, as prompted by France and Italy – although the Guardian reported that, at a meeting of EU interior ministers, “15 of the 22 EU states which had signed up to Schengen supported the move, with only four resisting”. Meanwhile, the European Commission President, José Manuel Barroso, has written a strongly worded letter to the Danish prime minister, Lars Lokke Rasmussen, warning against the Danish Government’s proposals to unilaterally re-introduce … Read more

Rehn: “I expect this issue of pricing policy will be looked at from the overall European perspective…”

The European Union’s economic and monetary affairs commissioner, Olli Rehn, has been making somewhat encouraging noises  [for the new Irish government] ahead of a series of key European meetings for the incoming Taoiseach. From the Irish Times breaking news report “We look forward to continue supporting the Irish people and the next Irish government in the implementation of the EU- IMF program, which is key for Ireland’s economy and its revival,” Mr Rehn told reporters in Brussels. “We have the common … Read more

Olli Rehn: “We are now in the decade of fundamental reforms”

As the Irish Times notes,  EU economics and monetary affairs Commissioner Olli Rehn has joined the head of the IMF in calling for “well coordinated action to safeguard stability in the euro area”.  From the Irish Times Mr Rehn told the conference [in Athens] that the euro area was determined to agree thorough reform to set up a new system of economic governance. “We will not stop until we have accomplished our mission. We are now in the decade of fundamental reforms,” … Read more

“Hollow nationalist rhetoric will not do.”

In the Belfast Telegraph Sinn Féin MLA Mitchel McLaughlin responds to Ed Curran’s question on the cost of a united Ireland with some hollow nationalist rhetoric, and indulges in some fantasy economics. An analysis of the expenditure by ‘regions’ along with a series of estimates of the revenues from the regions by Oxford Economics shines some light on the actual subvention by the British Exchequer. The main findings demonstrate that total ‘identifiable expenditure’ for the North was £14.1bn in 2004/05. This is … Read more

Euro crisis: “This might be the last chance to bring stability back to the European’s financial system…”

The day after the details of Ireland’s bail-out were revealed, the BBC notes the markets’ reaction On Sunday, ministers reached agreement over a bail-out worth about 85bn euros ($113bn; £72bn). On Monday, the euro fell 0.8% to $1.3136, its lowest since 21 September. And Irish, Spanish and Portuguese bond yields remained stubbornly high, indicating the market is not convinced European debt problems have gone away. Meanwhile, major European markets were also lower in midday trade. The euro also fell against … Read more

“It is the long term nature of this crisis that is just beginning to gain recognition.”

If there was any uncertainty about the markets’ reaction yesterday to Ireland’s bail-out, and to subsequent events, today’s plummeting Irish bank shares and more evidence of the fear of contagion in the markets should remove all doubt. The euro has hit a seven-week low against the dollar and global stock markets retreated today on fears that the Republic’s debt crisis may spread to other European countries with large budget deficits. Investors fear that Portugal and Spain may also have to seek financial help. The Spanish … Read more

Stephanomics: “broad lessons for the eurozone are already clear, and not encouraging”

Market Moves notes the reaction to today’s events in their London Market’s closing comments Worries over stability in the Emerald Isle are being compounded as the bailout becomes more and more political by the day, with the opposition party Fine Gael calling for a snap general election, citing public distrust over the handling of the crisis. The risk of contagion still lingers over European markets, with traders now eyeing up the next sacrificial lamb. Spanish and Italian markets are down … Read more

Olli Rehn: ‘it is likely unfortunately to imply tax increases’

I’d wait for the detail, Brian, before declaring anything ‘safe’.  RTÉ reports the latest comments from European Commissioner for Economic and Monetary Affairs, Olli Rehn, on Ireland’s bail-out application.  From the RTÉ report European Commissioner for Economic and Monetary Affairs Olli Rehn has reiterated that Ireland would no longer be a low tax economy. When asked in an interview with RTÉ News if the corporate tax rate was now off the table for good, Mr Rehn said that by Ireland ceasing … Read more

“Could a bank bring down a country?”

As was indicated previously, the Irish Minister for Finance, Brian Lenihan, has confirmed the conditions under which a bail-out will be required Minister for Finance Brian Lenihan has said that it is clear Ireland will need some sort of external assistance to address the problems in the banking sector. Mr Lenihan said officials from the International Monetary Fund and the European Union were not in Dublin to direct Irish affairs, but to offer advice on the four-year budgetary plan and … Read more

Lenihan: “if the banking problems in the country are too big for this small country to manage…”

The EU finance ministers meeting in Brussels have denied holding detailed discussions on a potential bail-out for Ireland.  From the BBC report [Belgian finance minister] Didier Reynders, who chaired the talks, said the situation was not addressed because the Irish government had not requested financial help. “There’s no reason to ask all the participants for an answer because we did not receive a question,” he said. And why would they discuss it?  The detailed discussions will be held tomorrow in Dublin. … Read more

Van Rompuy: “We’re in a survival crisis”

The Irish Minister for European Affairs, Dick Roche, tells European finance ministers not to “panic“… as the EU President, Herman Van Rompuy, panics? A Guardian report indicates the extent of the concern “The Irish problem is spreading, but it could get more volatile,” said Ashok Shah, chief investment officer at London Capital, a fund management firm. “They have to get this bailout, they have a period of time before it gets impossible, before nasty things happen. The longer they leave it, … Read more

Reuters: “Talks are ongoing and European Financial Stability Facility (EFSF) money will be used”

Despite the apparent ‘good news’ yesterday, it appears the pessimists may be right after all.  The BBC picks up on a Reuters report quoting “euro zone” sources Euro zone sources told Reuters that aid discussions were under way, however. One official said it was “very likely” that Ireland would get financial assistance from the EU facility set up after Greece obtained a 110 billion euro bailout in May. “Talks are ongoing and European Financial Stability Facility (EFSF) money will be … Read more

“The market obviously doesn’t believe the position at the moment”

Andy may fear for the children and idealists, but Taoiseach Brian Cowen’s main concern, as previously acknowledged by his Finance minister, is re-establishing lost international market confidence. And while a national consensus may prove elusive, despite the re-assurances of EU Commissioner Olli Rehn, those markets have given their initial verdict on the Irish Government’s judgement that a total cut of €15 billion is needed over four years to reduce the budget deficit to 3 per cent by 2014.  The iol report has … Read more

“with nothing less than Irish economic sovereignty on the line”

Another informative entry from the Irish Times‘ Arthur Beesley’s European Diary.  If you were wondering what the European Commission has in mind for those problem PIIGS, including Ireland, you could try the EU economic and monetary affairs commissioner Olli Rehn’s recommended reading…  From the Irish Times As the cost of the banking bailout approaches €50 billion, general government debt is set to rise to 98.6 per cent of GDP this year. As recently as 2007, it was 25 per cent.The upshot is that Ahern’s … Read more