Euro Watch

Amid the current international market turmoil, some countries are faring better than others. Germany and France are proving the strength of the continental European economies by weathering the tumultuous markets with business confidence in tact.

Last Wednesday saw Germany’s Ifo institute release figures which showed that the index has risen for the last three months consecutively, bolstering them to the highest level since August 2007.

The Insee statistical office in France reported similar happenings there, with business confidence being at there highest so far this year.

Analysts believe that the heightening of confidence in the two largest economies in the eurozone is indicative of a spurring economic movement.

The president of Ifo, Hans-Werner Sinn, said that the economy in Germany is gaining strength and that even with the euro trading so high, many companies are still expecting high revenues for exports for last month.

Figures are emerging now which seem to indicate that the eurozone has only been obliquely struck by the current international financial crisis. The housing market is still progressing with strength, whilst manufacturing in the region is also healthy, most notably in Germany. Europe’s largest economy is engineering, and according to figures released by the employer’s association, growth within the industry is at an 40 year high.

Whilst the U.S. dollar has been falling and higher interest rates in Europe have somewhat slowed the economy, European financial analysts are not predicting dark skies for the continents outlook. Inflation is at a 14 year high in the Eurozone , however the European Central Bank has left their interest rate at 4% and have not followed the trail left by the U.S. Federal Reserve.

According to the ECB president, Jean-Claude Trichet, it is the fact that the foundation of the Eurozone economy is so strong, and that they have a better balance, which has left the regions markets in a more stable condition than their counterparts across the Atlantic. Trichet also said that unemployment has fallen to a 25 year low.

The ECB president also went on to talk about the the fact that the euro was trading so well, and the rammifications that would have on trade. He stated that there shouldn’t be a great deal of change in rates or too many market moves as that would lead to a downward trend in economic growth.

A survey conducted by the Ifo showed that business had become more positive about current situations than they had previously been.

In Germany, March saw the index rise to 104.8 for March from 104.1 for February, which is the highest point since August last year. France also saw the business confidence index rise, from 107 in February to 109 now.

Though there are some countries in the eurozone which aren’t doing so well. Business confidence in Italy has fallen to the lowest point in two years.

Tags: European Economy News, European Union News by Elisha Sanders
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The new opening of Heathrow Terminal 5 was marred with many problems such as protesters and a faulty baggage machine. Terminal 5 was built to be the new state of art terminal to move passengers quickly to their destination.

However, after less than an hour, many people were left angry as the baggage machine failed to operate. This created a series of delays. Afterwards, the opening was dampened by a group of protesters who feel that a new runway should not be opened as planned in 2020. All of these factors dampened the excitement of the new terminal opening.

Tags: European Union News by Lashan Clarke
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Cyprus is still a divided island, however the Greek and Turkish leaders of the island have agreed to a series of meetings, set in three months times, to discuss paths to unification, which has held Turkey back from being accepted into European Union.

In a sign of peace, both the Greek leader of Cyprus, Demetris Christofias, and the Turkish leader of Cyprus, Mehmet Ail Talat, have agreed to un-blockade Ledra Street in Nicosia, which has long been a symbolic, as well as physical, depiction of the division.

The U.N. hosted the first meeting between the Cypriot leaders, at a U.N. controlled part of Nicosia, the capital, and have been the ones to make the announcement regarding the scheduled talks and the reopening of Ledra Street

Last month, Christofias was elected to the presidency of the island, which has renewed hopes for unification talks to be established again. In 2004 Greek Cypriots voted against a plan brought by the U.N. for the reunification of Cyprus.

At this stage, tensions are mounting as analysts are predicting these scheduled meetings to be the final chance for clearing the division. Politicians are also concerned as they do not want to see yet another standoff between the communities, as it would have strong negative repercussions for Turkey in their bid to join the E.U.

Cyprus has been divided between Greek and Turkish communities since an invasion by the latter in 1974, which was was a counter to a mainly Greek coup.

The last attempt for unification was in 2004 when a plan was put forth by the U.N., which was accepted by Turkish Cypriots, but rejected by Greek Cypriots who shortly after joined the E.U. by themselves.

Tags: European Union News by Elisha Sanders
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According to Lord Neil Kinnock, a former politician who is now the chair of the British Council, the mounting hostility between Europeans and U.S. citizens could leave long lasting damage to transatlantic relations.

A former vice-president of the European Commission, Lord Kinnock stated that he found the results in the British Council survey that was published on Wednesday to be concerning as 46% of Europeans surveyed agreed that they viewed the overriding influence of the U.S. in the world to be a negative one.

Lord Kinnock believes that these sentiments are increasingly prevalent towards the U.S. and that the opinions of Europeans towards the U.S. became even more dubious when George W. Bush snatched power in 2001. European sentiments took an even worse turn when the U.S. invaded Iraq five years ago.

On the other side of the pond, over 30% of U.S.citizens see Europeans as being aloof; which shows that transatlantic relations aren’t very good on either side and worse than thought before.

The results listed in the poll suggest that the measures taken by European countries and Washington to co-operatively fight climate change, international terrorism and poverty haven’t had a strong impact at all. Nine countries were polled for these results, Britain, Ireland, Poland, Germany, France, Spain,Turkey, Canada, and the U.S.

According to Lord Kinnock, the E.U. has stepped up relations with the U.S., however because there is yet to be much of an impact on issues like climate change and terrorism, citizens from both sides aren’t seeing much come of the co-operation and, understandably, don’t see it as really working.

The survey showed that most people would actually be happy with stronger transatlantic bonds, however there are blocks in that path too. Europeans cite their primary reason for not engaging with the U.S. as being due to Washington’s current foreign policy, and citizens of the U.S. stated that the main roadblock to closer ties is that Europeans are too liberal.

Other polls have shown similar concerns from Europeans towards the U.S.; in a Harris opinion poll which was conducted for the Financial Times and published this week it was shown that Europeans – British, German, and Spanish citizens were polled – consider the largest threat to global stability to be the the U.S., who topped even China, Iran, and North Korea.

Lord Kinnock said that the British Council has embarked on a youth project which is to combat the psychological widening of the Atlantic.

According to the British Council’s head of communications for western Europe and North America, Julian Morgan, the survey indicates the true depth of the breach between Europe and the U.S., which has far exceeded expectations.

Morgan also stated that the survey suggested that cultural stereotypes were still in full swing, with 34% of those polled in the U.S. stating they believed Europeans are snobbish, and 62% of Europeans polled, believe those in the U.S. to be keen consumers and 45% think people from the U.S. are selfish.

The U.S. people polled were apparently happier to take action against environmental or social issues that they cared about, like paying taxes.

There were some strikingly positive views from both sides regarding transatlantic co-operation, which concerned business and trade, and the fighting of global diseases like HIV-Aids and malaria.

A minimum of 500 people participated in the survey in each country, and in the U.K. 1,019 people were polled and 2,001 were polled in the U.S., according to the two companies to perform the polls, GlobeScan and IFF.

Tags: European Union News by Elisha Sanders
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The European Union are set to lead the world once more in the fight against global warming. Within the next 12 months, the E.U. will introduce new laws to ensure they reach the decisive goals they the have outlined for themselves.

Friday should see the E.U., which is comprised of 27 nations from Europe, announce from the culmination of a two-day summit, the new laws to come into effect no later than March 2009 which entail slashing greenhouse gas emissions and raising renewable energy used.

In the overview of the summit, leaders where also to discuss the current financial market crisis which has been ongoing since last year. All of the delegates are expected to completely disclose the extent of the distressed assets, incorrect balance sheets, and losses faced by financial institutions of their country’s.

The E.U. is expected to warn against using sovereign wealth for political investments, but praise the use of sovereign funds for commercially motivated capital and liquidity.

The summit commenced on Friday and was opened with a reaffirmation of the E.U.’s ongoing commitment to reforms inspired by the Lisbon strategy which, since a rocky start when first adopted in 2000, has yielded substantial positive results.

The next subject on the agenda will be to establish a cohesive plan of action against climate change; which according to José Manuel Barroso, European Commission president, the E.U. do not have significant credibility in this area yet, though with decisive action will gain it quickly.

At this stage, the E.U. already have a standing commitment to a greener Europe, with a pledge to reduce emissions by 20% and increase renewable energy consumption by 20% by 2020. Also committed to 2020, is the use of at least 10% biofule within vehicle fuels.

The Commission suggested in January that carbon reduction and the inclusion of renewable energy sources should be perhaps based on the wealth of the country, so that the more financially stable countries of the E.U. would be the ones to face the heavier financial burden.

The plan at this stage is for each nation to agree within on national goals by December, and then to have E.U. level legislation passed by March 2009.

The E.U. is looking to ensure that it is fully disclosed, economically equitable and balanced for all countries, whilst still attaining their goal of reducing carbon emissions by 30% by 2020.

Whilst there is still criticism from environmentalists, as they believe the E.U. is being too lenient because of industrial complaints and lobbies, many political leaders have a much different opinion. Some are concerned that they will no longer be economically competitive because some other countries may not impose strictures as regulated as those in Europe.

The E.U. combats these concerns by outlining in the summit statement the action, which is to be in the form of an international agreement, to be taken against those countries who do not take adequate measures against emissions.

The reason for the push for March 2009 is because that is the last month in which legislative session will be held before closures for European elections in June. When parliament reconvenes, they are necessarily going to have to sort administrative tasks and hold hearings for the next set of European Commission delegates.

This legislation needs to be passed by March 2009 and before the newly elected delegates of the Commission sit for autumn sessions; as in December 2009 a conference is to be held in Copenhagen, on global emission cuts, to which China, the U.S., and other powers, are to attend.

Tags: European Economy News, European Union News by Elisha Sanders
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Nine months ago, Yves Leterme, a divisive Flemish, Christian, Democrat was elected to the role of Prime Minister (PM) in Belgium. Next week, his administration actually steps in and takes up leadership of the country.

Since being elected last year, the PM has weathered a severe political deadlock and serious health issues.

Leterme is expected to be fully installed as PM during the Easter period, which will see this tumultuous period in the history of Belgium come to a close, however other dangers are lurking just around the corner for Leterme.

The new PM has been quoted as saying that it was only the King, the national football team, and bear that held the country’s Flemish majority and Francophone minority together in any sort of cohesion, and it is the job of Leterme to now pull these two factions together and create more positive bonds throughout the country.

Leterme is just now moving into the traditional HQ of the PM, a neoclassical office in Brussels, and right away must take steps to resolve the heightening tensions regarding further devolution.

It was these contentious issues which where the key to the embarrassing 192-day political standoff after the election in Belgium, during which time, with the post-poll stalemate lasting the longest in the country’s history, speculations were voiced over whether the country may even have split in two.

The campaign base for Leterme was in Flanders, which is a wealthy predominantly Dutch-speaking area, and his main campaign stratagem was a populist pledge which would bring more self-rule for both tax and employment policies throughout the provinces of the country, however this is shaping up to be a very difficult promise to deliver, and the pressure is on for him to offer, and have it accepted by officials, a new settlement on reform of the state, by July.

Belgium is known to be the most decentralised country in the European Union, with its federal government being purposefully fragmented. The current population of Belgium is 10.5 million.

Due to the decentralised nature of Belgium, the regions of the country are already largely self-sufficient, however a deal that was agreed to by the federal government last month will give provinces even more control over housing, agriculture, and industrial policy.

Whilst there are many in Flanders – the former campaign base of Leterme – who are voicing desires for more autonomy, there are groups of Francophones in the south – who were once economically dominant due to heavy industry, and who are now largely poorer and in need of Flemish support – who are loath to adjust the current situation.

The new five-part government is going to be tested a lot in these early months after the handover, and the current calls for constitutional amendments is just one of the tests before them.

The political ground for Leterme is still quite rocky, as he has been accused of being indecisive and has made made some regrettable comments about his Francophone constituents; though he is in the process of redeeming himself with this part of the population.

A fellow government official has made comments regarding Leterme’s ability to put his metaphorical foot in his mouth, saying that he isn’t a highly emotionally intelligent person and that his verbal faux pas’ aren’t in any way meant to be antagonistic towards the Francophone populace.

There are still those who believe strongly in Leterme, such as Frank Vandenbroucke, the socialist politician who worked with the new PM during the prior Flemish administration, saying that Leterme has always listened to all his advisers; wishing all groups to have a voice, before he makes any decisions.

The chances for Leterme to actually be PM looked rather slim for some time, as he failed to have a government ready to step in after he was elected in June, and his attempts to form that government were seriously hampered by arguments over constitutional reform and language rights. All of this was sorted finally in December when an agreement was reached.

Concerns were raised once again when Leterme was hospitalised for two weeks last month, at which time he was diagnosed with internal bleeding. Leterme is now back at work, and the 47 year old seems to have been humbled during this time.

He has stated that he is going to try to be more wise, calm, and equable, yet still just as enthusiastic and devoted to his responsibilities.

At a glance through Leterme’s records it is obvious that he is well qualified for his new role. Though he is Flemish, his father is Francophone and Leterme speaks perfect French. He has also worked in all levels of government in Belgium, from regional, to federal, to European Union.

The last PM, Guy Verhofstadt, was elected in 1999 and though he lost the election last July, he stayed to oversee a caretaker government until Leterme takes over later next week.

During the stalemate, Verhofstadt held together a three-month administration from December onwards to address urgent reform decisions.

Due to the decentralised nature of the country, most daily services weren’t affected by the political incident, however big-business was ham-stringed by the inability to pass imperative legislation and deep-seeded uncertainty of a unified Belgium in the future arose during this time.

Analysts, such as Marc Swyngedouw, of the Catholic University of Leuven’s social sciences faculty, have stated that to be successful, the new PM is going to have to gain the staunch support of both sides in Belgium. He believes that even with Leterme stepping in, the instability of the country is not at an end.

Tags: European Economy News, European Union News by Elisha Sanders
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The European Union Commissioner wants a promotion to work against the usual typecast of the professional women as too technical and boring. Viviane Reding, the Commissioner of European Commission for information media & society and the ambassador against the overcharge roaming charges did set her views on the deflating geeky IT typecasts that she feels are setting women off working in the technology. Very soon Viviane Reding aims to establish a European code of most excellent performance for women in the IT sector in order to address the alleged absorbent channel incident. Whereby most of the females get bored gradually in working in the IT sector as they develop through education and settle on a particular career.
In her statement Reding said that they require to prevail over the usual typecasts that illustrate ICT careers as too technical and uninteresting fro women. Instead should persuade women to succeed in this innovative, multi-faceted and exciting sector. Reding also cautioned that the European region must deal with its deficiency of qualified IT staff as a main concern or threat declining behind the IT competitors in the Asian region. According to the European Commission, the IT sector has also contributed to the quarter of European Union’s entire development and 4 % of its jobs. However, there is a deficiency of about 300,000 qualified IT staff.
Therefore, attracting more women is very much essential in order to assist to seal the talents gap. For the past two years, the European Commission has been running a program for IT work-shadowing that offers females a chance of choosing their careers. Previous researches from the IT sector talents organization, e-skills UK has established several number of computing students in the region had declined to 50 % since the last five years whereas, the number of females working in the IT sector had fallen to one out of five workers.
According to the analysis conducted by European commission in October 2007, from the 150 telecommunication companies in Europe, they found that the average percentage of women working was only 6 %. It is because women are normally under-signified at the senior administrative level in the IT sectors. The European Commission has also published an entire report that looks in the gender balance in the upper levels of the senior administration which entitled men and women decision making 2007. According to the report, men represent almost 10 board members in most of the top companies and the also make 2/3rd of companies bosses.
Talking about the deficiency of women in the IT sector with the silicon.com, Mary Turner CEO of Tiscali UK said that IT is only the part of this bigger outlook, it is not only women in the IT sector it is women in the boardrooms and also in the management. However, Turner was confident of changes in the near future. She said that the technology is distinguished as a geeky field for men; nevertheless they are seeing more women coming forward to work in these sectors. She thinks that it would be exponential since everything in life one needs the first team to come in and then extend in the world and persuade.

Tags: European Union News by James Gardner
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Business leaders from Europe have warned that the euro may suffer if the EU fails to build up prevailing political organizations in order to stabilize the European Central Bank. President of Business Europe, one of the leading Pan-European Business organizations, Ernest-Antoine Seilliere, said that at present there is no stability between the supremacy of the European organizations and the European Central Bank. He also said that they consider the euro will suffer in the long term if there is no political support, especially by the eurogroup. Seilliere said this with the reference to the eurozones 15 financial ministers who hold official meetings every month.

As the euro ascended to its record breaking high in the markets of the foreign exchange, reaching 1.5347 dollars, Seilliere spoke to the reporters about the threats to euro in the near future.

On Friday morning, the euro had reached a record high of 1.5347 dollars against the British pound. Business Europe did not mention its desire to observe the tough responsibilities in co-coordinating the economic policies of the eurozone. Nevertheless, Seilliere did comment on accounts of the growing concerns of European Union on the increasing euro against the Asian currencies like Chinese Renminbi and Japanese Yen.

Seilliere also said that they were looking forward to eurogroup attaining more authority, power and genuine prospective when it holds meetings. Prime Minister, Jean-Claude Juncker has done much, but there is still more that can be done, added Seilliere, in reference to the leader of Luxembourg who holds meetings of eurogroup. He even said that synchronization in the European region for its economic policies is very much essential. He requested the Luxembourg leader to join forces with Washington, Beijing and Tokyo and discuss growing concerns of the world’s economy in order to maintain the monetary system of the world.

It may not be possible to hold talks immediately, but it can be done in the near future, otherwise the euro will decline to 1.80 dollars, said Seilliere. He even questioned the legality of the European Central Bank self governing system which entails much political involvement. Seilliere pointed out that due to agreements that currently govern the monetary system of the European Union , the ECB was in fact eurozone’s most powerful organization. This makes the reckoning of influence in economic discussions and global monetary difficult for the eurozone.

The supremacy of euro was undeniably making life hard for some of the export sectors in the European region, said Seilliere. Nevertheless, some of the business leaders in Europe cherished the supremacy of euro because it was helping to maintain the inflationary force of soaring gas and oil prices, added Seilliere. The resolution the competitiveness problem in Europe lies in labor market reforms, A better education system, and business innovation, said Seilliere. He also said that these business leaders should not miscalculate the importance of euros supremacy.

Tags: ECB: European Central Bank News, European Economy News, European Union News by Vanessa Clark
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The European consumer expenditure that accounts to about 60 % of the financial system, declined for the first time in the fourth quarter restricting the economic growth of the region. Since 2001 the consumer expenditure in the European region fell down to 0.1 % for the first time since six years. This happened after developing 0.5 % in the last three months reported the statistics office of European Union in Luxembourg. The development in the sickening domestic products relieved from 0.7 % to 0.4 %, harmonizing the evaluation that was published on 14th February. The towering prices of gasoline, bread and milk were corroding household expenditure control in the European region even as the unemployment declined to the lowest level since 1993.

The economic slowdown of United States at the same time also reduced the demands of European products. Even the increase in the euros records against the US dollar made the exports less feasible, making the companies to reduce investments. Unicredit MIB economist Aurelio Maccario, in Milan, said that the consumer figures were even worse than they were expecting. As the current investments seem to be the best news, the predictions are less glowing and the tendency may soften in the coming months. At present the figures show that the investment growth of the company has slowed down from 1.2 % to 0.8 %, whereas the government expenditure has slipped down to 0.1 %. Even exports had enhanced to 0.5 % in comparison to the previous three months which was at 2.1 %.

Production Level

In a separate report it showed that the inflation of the production level increased in the month of January to the record in 17 months as the energy prices mounted high. The decline in the development of the European region could extend this year, as the nastiest housing downturn of US in 25 years restricted the development in the largest economy of the world. Even the progress of euro against the dollar warns the sales overseas. In the past one year the euro rose up to 16 % against the US dollar, reaching to a record high of 1.5275 dollars on 3rd March. In Brussels it slipped down to 1.5196 dollars by 0.1 % at 11.45 am on the next day.
After this report the European stocks completed its declines. The Stoxx 600 fell to 0.7 % and the Dow Jones Stoxx 600 slipped to 0.9 %. The government bonds climbed up overturning the previous decline. The 10 year bund yield of the Europe’s target slipped to 3.85 % by 1 basic point. From the previous year the economy of the European region grew up to 2.2 % in the fourth quarter, altering the first 2.3 % evaluation. In the third quarter the economy grew up to 2.6 %.

Inflation in the Production Prices

Present day figures show that the inflation in the production prices increased from 4.3 % in the month of December to 4.9 % in the month of January. The energy growth prices also increased to 11 % whereas the prices for durable consumer goods and intermediate goods even mounted high. The Chief European economist Howard Archer said that the report on the production prices will manage the ECB’s worries on increasing pressures which reduce the supplying sequence. In the third quarter Germany’s GDP climbed to 0.3 % when it improved 0.7 % expansion in Netherlands and France, whereas the economic development of Spain increased from 0.7 % to 0.8 % in the third quarter.

Tags: European Economy News, European Union News by Michael Greene
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Tensions between the German and French leaders appear to have relieved as they have found solutions on the Mediterranean Union proposal. A freezing burst in the German-French relations might be melting at-least on the serious problem which had divided Paris and Berlin. On 3rd March, both Nicholas Sarkozy, French President and Angela Merkel, German Chancellor declared that they had come to a conclusion regarding the Mediterranean Union proposal made by Sarkozy. In the recent weeks, German Chancellor was constantly criticizing the project. However, on 3rd March both the leaders seemed to have counterfeited the agreement. Sarkozy said that both the leaders have compromised on the proposal that will not prohibit anyone. They have agreed on details and the principles said the French President.
Angelo Merkel the German Chancellor said that the following result should be known as Mediterranean Union and it also should be the joint venture for all the Members of the European Union. This was said in a press conference jointly held with Sarkozy at the CeBIT computer trade fair in which France was the official guest country. Merkel referred to the deal in order to create a union along with the Mediterranean States which border the countries of European Union. This deal should be agreed and well planned in combination with all the members of EU States and not just the Mediterranean states as the French President had proposed in the beginning.
However, both the leaders did not summarize any particular details. The French President said that they did not prefer to capture the spotlight of EU from Slovenia that at present holds the bloc’s revolving administration. France believes placement to be in the month of July and the French President had intended to make the organization of the Mediterranean Union the main attraction of the six months tenure of Paris.
Earlier, Merkel had blamed Sarkozy for avoiding the existing strategies of EU in an effort to boost diplomatic influence oversees of France and for offering expenditure finances from the bloc of 27-nation in order to assist the creation of a new union. Sarkozy hoped to utilize the idea of “Club Med” which was disapproved by the critics, after the holiday chain of France in order to strengthen relations with the nations of Middle East and North Africa including Turkey. However, diplomats from Germany observed it as an effort to set up a second-tier European Union dominated by France. Some of them accused Sarkozy for utilizing it to avoid the membership in the EU for Turkey.
Allgemeine Zeitung from Frankfurt noted on 4th March that the German Chancellor had at first rejected the plan proposed by Sarkozy not due to Germany but due to the interests of the European states. The main problem of France is that it wants to resolve the solution with its bordering states that are even alleged by the German Chancellor as common problems for the European Union such as environmental protection, climate, trade, illegal immigration and the peace process in the Middle East. The German Chancellor insists that this proposal should be included in the European Union’s Barcelona procedure that was established in the year 1995. He also aims at promoting talks between the ten bordering countries and European Union.

Tags: European Economy News, European Union News by James Gardner
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The European Commission has punished American software giant Microsoft and has ordered the company to pay a staggering amount of 899 million euros, that is about $1.35 billion on Wednesday this week. The fine was imposed as the company did not follow the sanctions imposed on it for the antitrust breach and the latest fine for the company goes far beyond the original fine imposed on Microsoft. The executive body of the European Union, the European Commission has now penalized Microsoft to the tune of 1.68 million euros for the company’s original breach as well as for not observing the sanctions. The fine by the EU for Microsoft is greater than any other company ever had to bear.

The European Commission has also added that Microsoft was the only company that overlooked the sanctions and every other firm complied with the sanctions. Neelie Kroes, the competition commissioner said in a statement that in the fifty years of the EU competition policy Microsoft was the only company which the European Commission had to penalize for not complying with the antitrust judgment. A statement issued by Microsoft said that the fines ordered by the commission were in relation to past issues and it now looks to the future.

In a 2004 milestone judgment, which was also sustained by the EU court last year, the European Commission had said that Microsoft had denied the required information about interoperability to its rival manufacturer of the work group server software. The work group server software runs printers and sign-on for the small office groups and it must work together with the desktop Windows machine. The commission came to know that Microsoft withheld the important interoperability codes to competitors because of which the market shares of the firms shrunk in value whereas the product of Microsoft gained in the market. Microsoft was told to share the information and it also promised to share the information but put in place great royalties citing innovation.

The commission instead came to know that the information Microsoft was withholding did not have any great innovation and it was more of a lock to the combination for which the company was not sharing. The commission also ruled that that the royalties Microsoft wanted were quite disproportionate. Neelie Kroes, the competition commissioner hoped that this ruling of the EU will close the gloomy phase in Microsoft’s history of nonconformity with the European Commission’s judgment of March 2004.

Microsoft has had a record of penalties by the EU, and in 2004 Microsoft was fined e497 million and it again was fined in 2006 for not complying with sanctions to the tune of e280.5 million. And the fresh fine for Microsoft relates to the fine which was imposed in 2006 and the fine is for the period extending from June 21, 2006 until October 21, 2007 following which the company promised to cut down the royalties and share the vital information. In the last week when Microsoft felt that there is going to be the possibility of a huge fine, it came with a public promise that it would publish the vital information so that competitor programs work with windows.

Tags: European Union News by Vanessa Clark
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The highest court of Europe ruled that the right to market cheese under the name Parmesan should go to the Italians. The court also dismissed the German’s claim that they can use the same name for their own variations of cheese. The Parmesan cheese is used as a topping in pasta. European Court of Justice in Luxembourg held that only those varieties of cheeses which bear the protected designation of origin `Parmigiano Reggiano’ can be allowed to sell in the market bearing the name Parmesan.

This ruling by the highest court in Europe will help the European Union in its efforts to expand marketing security for food items that come from particular regions in Europe like Roquefort cheese and Prosciutto di Parma. The argument regarding the range of the supposed geographical indications has set the European Union against nations like Australia, Argentina, and the United States in the global trade discussions. Author of `Italian Cheese: A Guide to Its Discovery and Appreciation, Piero Sardo seemed very elated with this court ruling and said that is was a totally wonderful news and further added that this dispute has been going on without any result in site for as long as 12 years.

Paolo De Castro, the Italian Agriculture Minister expressed that with this ruling by the court thus the doubts and suspicions surrounding the name Parmesan are removed. De Castro offered a big piece of the debated cheese to reporters at the press conference in Rome and said that now in Europe consumers can find authentic Parmesan. However, he further added that outside the European Union the case is quite different and consumers run the risk of buying Parmesan which is not Parmesan at all. In Italy there are five hundred Parmesan producers who all are certified which the Consortium of Parmigiano-Reggiano Cheese represents. These certified parmesan producers firmly adhere to the 800 year old method of making the Parmesan cheese. In the last year the official sales figure of the Parmesan cheese had stood at 1.5 billion euros which is $2.2 billion and the 16% of the total Parmesan sold was in the form of exports.

Parmigiano Reggiano is secured as the geographical indication since 1996 in the twenty seven nation strong European Union. The protection means that the name can only be used for the cheese produced, grated and packaged in the regions surrounding the cities of Parma and Reggio in Italy. The executive agency of the European Union, the European Commission went to court against Germany when it did not punish the cheese makers who used the name and it also argued that that name was generic. The European Commission had said that Parmesan is the rendition of the protected phrase Parmigiano Reggiano. A Parmesan producer Paolo Carra coming from the nearby region of Mantova, Italy expressed that the name Parmesan should be protected because not only the consumers but also the producers are cheated. When consumers buy Parmesan which actually is not a Parmesan cheese, producers run the risk of losing customers who are not satisfied with the quality of the cheese.

Tags: European Union News by Vanessa Clark
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The European Commission cut its forecast for economic growth and raised its projection for inflation, reflecting the dilemma facing the European Central Bank. The economy of the 15 nations that share the euro will expand 1.8 percent this year, which is 0.4 percent below the rate predicted in November and the weakest since 2005. Inflation will average 2.6 percent, which is an increase from the previous estimate of 2.1 percent, the strongest since the euro began trading in 1999. The lethal combo of weakening expansion and rising inflation complicates the work of ECB, as it seeks to shield its economy from a US slowdown, without surrendering its campaign to restrain price pressures. The commission announced that economic activity is set to moderate, but the risks to the growth forecast remains sizeable.

The U.S slowdown is combining with costlier credit along with oil prices rising to about $199 a barrel and a rising euro to curb expansion. At the same time, higher energy prices and more expensive food are fanning inflation. Such risks prompted ECB President Jean–Claude Trichet to warn that stronger inflation and weaker growth, both were risks to economy. This was in stark contrast to his previous view that price pressures were the greatest threat. The central bank has left it’s benchmark interest rate at a six-year high of 4 percent since June and investors predict it will follow the Federal Reserve in easing credit by the end of second quarter.

Heineken NV, the Dutch brewer, announced that second-half profit fell by a third as slower economic growth in the US prevented the company from increasing prices in an effort to offset the rising cost of barley, metal and power. As a result, shares posted the biggest drop since 2003. The jump in credit costs from the collapse of the US subprime–mortgage market has sparked losses in stock markets around the world as Wall Street firms revealed $146 billion in losses on their debt holdings. Global stocks have lost more than $6 trillion this year. The commission’s growth forecast is more optimistic than the 1.6 percent prediction of the International Monetary Fund and the 1.7 percent median estimate of economists surveyed by Bloomberg News.

ECB releases new forecasts on March 6. Record–low unemployment, a balanced current account and “comparatively” low government budget deficits have cushioned the economy, the commission had said. In a review of individual economies, the commission slashed its forecast for growth in Italy by half to 0.7 percent amid a decline in confidence among executives. It predicted Spain would witness a “soft landing”, even as its real-estate market fades, with a growth of 2.7 percent this year, which is lower than its previous estimate of 3.0 percent. The commission said that weaker international growth explained its decision to cut its prediction for expansion in Germany from 1.6 percent to 2.1 percent and that for France from 1.7 percent to 2.0 percent.

Tags: European Economy News, European Union News by Michael Greene
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The European Union struggled to put up a show of unity over Kosovo, even as majority of the members agreed to recognize the breakaway province’s declaration of independence, Spain and Romania rubbished its action as illegal. France’s foreign minister, Bernard Kouchner announced President Nicolas Sarkozy’s decision that the time has come to end the Balkan troubles and the need of the hour is reconciliation. About 20 of the 27 member states in the EU including Italy, Germany and the UK were ready to recognize the Kosovars as independent. EU’s efforts to at least put up a show of unity failed as Spain made it clear from the start that it has no intention of recognizing Kosovo’s independence. The reason stated is that Kosovo “did not respect international law”. The statement brutally exposed the divide within the EU over legal basis of Kosovo’s secession. Spain, wary of the impact on its Basque and Catalan nationalist movements, is thought to be unhappy that Kosovo’s ethnic Alban leaders declined to postpone independence until after Spain’s March 9 general election.

EU foreign minister later agreed on a joint statement that Kosovo’s independence set no precedent for other disputes in Europe or beyond. In an attempt to appease Belgrade’s anger, they repeated an offer of eventual Union membership for Serbia – and all other Balkan countries. EU hopes that the lure of membership will calm searing passions in Serbia and other Balkan states. The Kosovo crisis has yet again exposed the glaring differences of national interest within the EU, as they did during the wars of the Yugoslav succession back in the 1990’s. Russia, a prime opponent of Kosovo’s secession and Serbia’s strongest diplomatic ally, says it violates international law as it was not agreed on with Serbia and also lacked approval of the United Nations Security Council. Within the EU, Spain’s stance is shared by Bulgaria, Cyprus, Greece and Slovakia. However, some are concerned about the impact on their own minorities. The Greek Cypriot government fears that the recognition of Kosovo may bolster the cause of Turkish Cypriot separatists. In spite of the internal turmoil, EU is still trying to put up at least a phony show of unity by planning to send a law and order mission to Kosovo over the next four months and replace the UN operation that has administered it since 1999.

Berlin is expected to recognize Kosovo at a cabinet meeting on Wednesday; this was stated by Germany’s foreign minister, Frank-Walter Steinmeier. Although, Dimitrij Rupel, foreign minister of Slovenia and who also holds the EU’s rotating presidency bravely claimed that “The EU once again survived this test of unity”, it’s pretty clear that things are far from calm within the union. As each state tries to protect its own individualistic interests the matter seems far from getting resolved anytime soon.

Tags: European Economy News, European Union News by Vanessa Clark
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France was pressurized by the European Union ministers to meet scarcity of budgets. For the time being, the commission remains hopeful about a possible downturn. France was insisted by European ministers to maintain a resolution to an innovative target of 2010 for harmonizing its scarcity of budgets. However, it indicated that they would take into consideration the country’s progress report in the later assessment. On Monday the 11th of February, finance ministers from the 15 group decided to persuade France to achieve the target of reducing the scarcity of budgets, in spite of France being pressurized to stay away from any reference to the scarcity timetable implemented by the European Union’s financial members in Berlin during last April.

During the conference in Brussels, Jean-Claude Juncker, the Euro-group chief and the Prime Minister of Luxembourg said to the reporters that France needs to emphasize its efforts to consolidate budgets, through an accurate request of its budget for the year 2008 and even to be on mark for its medium term objective in the year 2010. It was generally due to the predictions of monetary slow down that France claimed it required to rework on the previous budgetary obligations and even to stabilize its orders by 2012. Christine Lagarde, French finance minister said that they are taking several efforts possible to accomplish their balance before 2010, however in the present circumstances there is no point in making allegations as it would be very difficult to do so.

However, as few of the bigger EU countries disagreed to accept these explanations, Wouter Bos, the Dutch finance minister commented that France had previously requested for this even prior to this as there was a recession, so that must not be the actual argument. Pointing out that the regulations reinforcing the Euros may lose reliability; Peer Steinbruck the German finance chief said that particularly the bigger countries may unite themselves to the pledge in order to accomplish their MTO by the year 2010. But, while verifying the new target, the ministers of Euro group even acknowledged that the cyclical activities of national global economies would be considered in future evaluation of countries presentation.

Jean-Claude Juncker said that they would asses the condition when the particular time arrives if in case France does not accomplish its given cyclical conditions. So to discuss on this issue, they along with the Euro group members would have to consider back when the time comes. The members of the Euro group must ensure that the decision made by Berlin is observed. In the meantime, Jose Manuel Barroso the president of European Commission did make an unusual appearance at the meeting for a discussion on the trends of general economy, subsequent to the latest turbulences on the worldwide economical markets. Barroso even said that they possess no specific reason to panic about declines. He even disagreed that the members of EU states should take legal actions relatively, than sending gloomy mails.

However, Joaquin Almunia the economy commissioner expressed clearly the concerns over the increasing inflation that accelerated in the financial union to 3.2 % in the month of January. He said that they expect the increasing inflation to be short-term; however they are particularly concerned over this. They need to stay vigilant and even remain watchful so that the increase does not turn out to be a fashion in the prospects of the financial agents.

Tags: European Economy News, European Union News by James Gardner
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As most of the Industries said that they are going to support Green Aviation R&D, the project of Clean Sky is about to inspect a whole lot of things from aircraft designs to aircraft engines in order to reduce releases and the foot prints of the carbon produced by aeronautic industries. On Tuesday the 5th of January, a joint private and public partnership was launched by the European Commission in order to develop technologies for green aviation. With 1.6 billion funds being collected, the Clean Sky plan is said to be one of the biggest research funds program ever organized by European Union.

Even though the aviation division is liable for almost 3 percent of worldwide carbon dioxide release the aviation sectors involvement in the environment change is growing more rapidly than any sector. According to the European Commission, from the year 1990 to the year 2002, the green house gas releases from most of the international aviation increased by more or less 70 percent as in the European Union releases from aviations increased by 87 percent between the years 1990 to 2006. By taking this into consideration the Clean Sky research plan expects to encourage and support the manufacturers of aircrafts in order to produce and develop greener products.

Most of the aircraft manufacturers like Rolls Royce, Saab, Dassault and Airbus have joined forces and signed up to support this green aviation plan. Half of the funds will be available from the public resources from the European Union’s R&D program of funding and the remaining half from the aeronautic industry. By the year 2002, the plan expects to have fifty percent reductions in the release of carbon dioxide, eight percent cuts in nitrogen oxide and fifty percent cuts in noise pollution. This also includes an environmental life cycle for several products for recycling, scrapping, maintenance, design and manufacture. The Saab’s CEO Mr. Åke Svensson, during the launch of clean sky plan said that the clean sky would address two easy questions like what to fly and how to fly. The trace left behind by the release of carbon from the manufacturing industries is quite visible however it is not acceptable said Svensson.

The plan for clean sky which will implement six technical regions from aircrafts to engines include 54 private companies, 17 universities, 15 research centers and 16 countries. In particular, the researches will try to examine a smart wing design for aircrafts with fixed wings like low weight, low noise regional aircraft such as original rotor blades, eco design to reduce fuel consumption, to increase recycling of old crafts and turbine engines for rotorcraft like sustainable green engines. Even by supporting to reduce releases of carbon from aircrafts which is the main plan to involve the aviation sector in the European Union’s ETC (Emissions Trading Scheme). From the year 2012, almost all the aircrafts impending to and sending-off 27 members and even the Intra European Union flights will be involved in this scheme.

Tags: European Economy News, European Union News by James Gardner
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In an effort to make the nationalized administrations work with extra responsibility for the capital they utilize, Netherlands refused to sign off on the accounts of the European Union. Despite of last year’s huge blunders created by the auditors in the excessive capital utilized on the national scale, the Finance Minister of Netherlands Wouter Bos was completely set at the conference to pass the budget of 107 Billion Euros for the year 2006. Finance Minister was in fact well supported by the members of the European Parliament and the European Commission as Bos wanted to force the states to provide concrete evidence that the capital was been utilized in a proper manner. If the states do not provide these proofs European Commission has threatened to postpone the funds or they may take legal measures. After being sworn in as the finance minister he was the first one to sign a yearly statement last year in which the European Union agricultural expenditure had been reviewed.

Dutch spokesman said to the Financial Times that an improvement has to be initiated in accounting the European Union’s money and there has to be a lot of work which has to be implemented by all the states of the country. It is a great concern for these states compared to the European Commission. European Union’s financial auditors said that European Union account has been qualified for the period of 12 years in a line up for shortage of powers. It was been established that 12 % of 32 billion euros budget for regional funds was paid out in the year 2006. It was for the sixth time that the error had occurred for supporting the agricultural economy. Although only a part of it would have been misused still the states were not able to show that they had utilized the money for appropriate purpose exclaimed the auditors.

The funds are been utilized for innovative infrastructure, projects for creating jobs, training and even across European Union, although it was concentrated in few of the poorer regions. Due to a lack of control, Europe has developed a bad image assumed the anti fraud Commissioner Siim Kallas. Previous year Kallas had broken an agreement with the government wherein they had agreed to provide evidence that the funds had been utilized for right purpose. The Government agreed to provide yearly reviews of the declarations and audits which were available, according to the draft documents that were prepared for the conference. However, the two parties opposed this for over timing. Most of the states declared that the deal applies only to the funds spent on certain programs which started last year and not on the programs which existed. Funds could be stopped if in case they would not deliver reports by the coming week exclaimed the regional policy commissioner Danuta Hubner. Kallas said to the Financial Times that the controlling system of the states are initially in line to make sure that the capitals are been utilized according to the strict speculations.

Tags: European Economy News, European Union News by Vanessa Clark
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The European Union has embraced proposals to reform energy markets throughout Europe, in a move designed to improve competition amongst providers for the benefit of consumer and business energy buyers.

The European Commission has today given the green light to measures which would require energy suppliers to avoid running their respective infrastructural markets, that is to say those major corporations controlling distribution channels as well as supply will no longer be able to do so within the EU.

The measures will requires those currently in monopolised infrastructural positions to either sell their infrastructure or lease it out to be controlled by other companies in order to continue to trade within Europe, hitting some of the region’s current major suppliers when they come into force.

The strict measures are designed to offer internal protection to EU energy suppliers, whilst creating a more level playing field for companies within the EU in the energy industries by eliminating the possibility of monopolising distribution networks and service sectors.

The move in particular will impact Russian giant Gazprom, which currently supplies around one quarter of European supplies from outwith the eurozone. In order to remain trading within the eurozone, Gazprom would be required by the new laws to disintegrate its pipeline network to comply.

At present, the European Commission suggests that the market structure is too accommodating of larger enterprises, which sap competition and leave many EU residents and businesses with no real choice in selecting energy providers. The new proposals are designed to create a more competitive marketplace for the benefit of end consumers throughout the Eurozone.

Market analysts are predicting that certain of the large central European providers like EON will be particularly affected by the measures, whilst it should also eventually result in a more free flow of gas and electricity throughout the eurozone region.

Tags: European Union News by stewart
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The European Commission has today announced its revised prediction for Eurozone growth over the coming months, after recent market volatility and poorer than expected economic results from some of the region’s major economies.

The Commission, based in Brussels, has predicted that the 13-nation Eurozone economy will grow by around 2.5% through the remainder of 2007. Previously, the Commission had forecast a 2.6% growth, below the 2.7% growth figure for the year 2006 reflecting a wider slowdown in Eurozone economic activity.

On top of the news of the slowdown, the Commission also forecast that the poor growth figures could worsen over the course of 2008, seeing a significant blow for the European economy over the next twelve months.

Recent market upset stateside had caused European mortgage lenders to adopt a more risky lending outlook. Additionally, with stock markets in turmoil, business investment has been less readily available throughout the Eurozone over the last few months, which has led to this downwards revision in growth.

European banks fearing over exposure to the sub-prime sector have withheld business investment, which has seen a major downturn in corporate activity over the year. With liquidity a premium, businesses and consumers across the world, and indeed the Eurozone, are finding it harder to raise finance from lending institutions.

Additionally, with France and Germany announcing sluggish growth over the second quarter of 2007, it had begun to look unlikely that previous growth figures would be realistic over the latter half of this year.

The slower economic growth has done nothing to dampen the spirits of stock market trading, which was buoyed across Europe and the US in light of positive American economy news and a shock OPEC announcement that oil production is to rise over the latter half of this year. However, it remains to be seen whether the downturn will have an adverse effect on trade tomorrow.

Tags: European Economy News, European Union News by stewart
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A former French cabinet minister is widely considered to be favourite to take over as the head of the International Monetary Fund (IMF), according to analysts in what has been very much a two-horse race.

Dominique Strauss-Kahn, the former French minister for finance is the favourite to take over the top role at the IMF, with nominations having closed over the weekend. Should Strauss-Kahn succeed to the position, he will add to the depth of French control of world economic organisations, from the World Trade Organisation to the European Central Bank.

He is expected to succeed current head Rodrigo de Rato, provided he is chosen above former Czech Prime Minister Josef Tosovsky, the only other candidate in consideration.

The Russia-endorsed former Czech leader was presented as a nomination reportedly to break the convention of European nations choosing the head of the IMF in return for the US nominating the head of the World Bank.

Until now, the top job at the IMF has been reserved to applicants from within the European Union countries, which many have criticised as being unreflective of global political power.

Analysts have widely predicted that Strauss-Kahn will take over, despite Josef Tosovsky being favoured earlier on in the contest. With political clout and sufficient experience to handle the role, it is regarded as almost certain that the former French finance minister will succeed to the position.

The IMF responsibilities cover poor, third world nations, and advising on financial strategy and aid. Additionally, it is responsible for maintaining stability in global financial markets.

However, it has come under fire from some third world nations, citing the first world domination of the IMF as well as ‘rigid’ policy implementation which can often conflict with other political aims of these countries.

Tags: European Economy News, European Union News by stewart
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