Next ECB president will have to revive weak activity

2019 ◽  
Keyword(s):  
European Commission ◽  
Euro Area ◽  
European Parliament ◽  
Content Type ◽  
Weak Activity ◽  
Commission President ◽  
Political Turmoil

Subject ECB succession. Significance Mario Draghi’s term as ECB president ends in October. The race for his succession is open and closely linked to the May European Parliament (EP) elections and the resulting appointment of a new European Commission president. Impacts The governing council’s collegial views will smooth out the new president’s position. If there is further political turmoil, the new president will have to prevent a resurgence of credit fragmentation within the euro-area. If Weidmann is appointed, markets will reprice rate expectations upwards, as he is urging policy normalisation.

EU leaders will be constrained by deepening divisions

2019 ◽  
Keyword(s):  
European Commission ◽  
Rule Of Law ◽  
Security Policy ◽  
European Parliament ◽  
Foreign Affairs ◽  
European Countries ◽  
Content Type ◽  
Central European ◽  
Commission President

Subject EU institutions. Significance The European Council’s choices of heads for the European Commission, ECB, Council and the High Representative for Foreign Affairs and Security Policy represent continuity. All are Western Europeans and all belong to centrist groups in the European Parliament (EP). However, the influence of the centre is declining in some institutions while that of peripheral groups is growing. Impacts Ursula von der Leyen's appointment as Commission president is destabilising to governing coalitions in Germany and Italy. Eastern and Central European countries believe that von der Leyen will adopte a more lenient stance on rule of law issues. Von der Leyen will support French President Emmanuel Macron's plans for European defence autonomy. Christine Lagarde’s nomination to head the ECB looks more like a political than a technical appointment.

Syriza may be troika's best hope for Greek deal

2015 ◽  
Keyword(s):  
Stock Market ◽  
European Commission ◽  
Financial Market ◽  
Euro Area ◽  
The Political ◽  
Costs And Benefits ◽  
Content Type ◽  
Political Left ◽  
Unexpected Outcomes ◽  
Market Exuberance

Subject Unexpected outcomes in the Greece-troika imbroglio. Significance Negotiations between Greece and its 'troika' of official-sector creditors (the European Commission, ECB and IMF) are taking place amid two meetings of the euro-area finance ministers and one summit of EU leaders before the end of February. While it is impossible to know now what the result will be, it is possible to speculate on the costs and benefits of any given scenario. Impacts If Syriza fails to achieve meaningful debt reduction, it could discredit the political left as well as the notion of EU solidarity. Greek sovereign yields and the Greek stock market are likely to react extremely positively to any deal between the troika and Greece. Financial market exuberance towards Greece will be unwound as the implications of Greece's continuing high debt load become clearer.

EU infrastructure plan could reinforce ECB policy

2015 ◽  
Keyword(s):  
Euro Area ◽  
Global Financial Crisis ◽  
Positive Impact ◽  
Fund Raising ◽  
Investment Bank ◽  
Content Type ◽  
Growth Prospects ◽  
Commission President ◽  
The Global Financial Crisis ◽  
European Investment

Subject Outlook for infrastructure spending. Significance European Commission President Jean-Claude Juncker proposed a 315 billion euro (340 billion dollar) infrastructure initiative to revive the EU economy, expected to reinforce ongoing monetary policy efforts to boost growth. Fund raising is progressing through the European Investment Bank (EIB). The programme can benefit both short-term and long-term growth prospects, while its actual impact will depend on the projects implemented, as politically motivated choices can delay, distort and depress the benefits. This plan comes late, six years after the global financial crisis; one of its priorities is generating rapid results to boost the economic recovery. Impacts To have a net positive impact, any infrastructure proposal would have to avoid drawing funds away from existing investment plans. The plan could help reducing disparities between labour markets in different euro-area countries. Persistently high euro-area unemployment will need a domestic demand revival to boost sentiment, growth and job creation.

'Juncker Plan' could mean EU investment bulge

2016 ◽  
Keyword(s):  
European Commission ◽  
Geographical Distribution ◽  
High Grade ◽  
Content Type ◽  
Chinese Investment ◽  
Investment Plan ◽  
Eu Referendum ◽  
Commission President ◽  
The Uk ◽  
The Eu

Subject The possible economic impact of the EU investment plan (the 'Juncker Plan'). Significance The EU investment plan launched by European Commission President Jean-Claude Juncker just over a year ago has made a slow start. This will encourage doubts that have existed since the scheme's inception about its operation and likely impact. Impacts Even by 2020, the EU economy will still probably require every effort to boost growth and make up for lost investment. Given continuing strong demand for high-grade bonds and equity investments, it should be possible to achieve the fundraising target. The plan could become a vehicle for Chinese investment into the EU: China is talking of 5-10 billion euros in future investments. The geographical distribution of funded projects could be politically sensitive within the EU. The plan could come under scrutiny during the UK EU referendum campaign; UK projects may come too late to have an impact before the vote.

EU state aid plans will concern some trade partners

2020 ◽  
Keyword(s):  
Competitive Advantage ◽  
European Commission ◽  
Euro Area ◽  
State Aid ◽  
Economic Recovery ◽  
Content Type ◽  
Eu Countries ◽  
Foreign Takeover ◽  
Trade Partners ◽  
Trade And Investment

Subject EU state aid. Significance The European Commission has approved more than EUR2.1tn (USD2.4tn) in state aid since March. This significant relaxation of state aid rules -- aimed at preventing businesses from collapsing and protecting them from foreign takeover -- could last for another year or two. At the same time, the Commission is preparing to bolster its scrutiny of aid by non-EU states which gives their firms a competitive advantage over EU ones. Impacts After aviation, those sectors most in need of state aid are other transport sectors, hospitality and tourism. Richer EU countries’ ability to provide much more state aid to its firms will fuel a disjoined economic recovery across the euro-area. The EU’s crackdown on foreign subsidies will likely make it more difficult to reach a trade and investment partnership with China.

EU comitology reform could politicise regulation

2017 ◽  
Keyword(s):  
Member State ◽  
European Commission ◽  
Interest Group ◽  
European Parliament ◽  
Member States ◽  
Content Type ◽  
Eu Regulation ◽  
Regulatory Decisions ◽  
The Eu ◽  
Final Reform

Subject Proposed reform of the EU comitology procedure. Significance The little-known ‘comitology’ procedure plays a key role in EU regulation. In recent years, this process has been breaking down as member-state expert representatives in comitology committees often abstain from voting, forcing the European Commission to take controversial decisions on its own (and accept any blame for them). In response, the Commission has proposed reforms that would pressure member states to take a position on (and hence political ownership of) controversial regulatory decisions. Impacts Government representatives, interest-group representatives and corporate lobbyists will be most affected by comitology reform. Despite adding transparency and avoiding blame-shifting to Brussels, the reforms would probably not help the EU’s image with citizens. The European Parliament might demand -- as part of any final reform package -- an increase in its involvement in the comitology process.

New EU plan for online extremism has modest promise

2018 ◽  
Keyword(s):  
Social Media ◽  
Law Enforcement ◽  
European Commission ◽  
Online Content ◽  
Content Type ◽  
Technology Firms ◽  
Commission President ◽  
Media Firms ◽  
Annual Turnover ◽  
The Eu

Significance Proposed measures include a plan outlined by European Commission President Jean-Claude Juncker in September, wherein the EU would oblige technology firms to remove terrorist and extremist content within one hour of being notified by the authorities or face fines of up to 4% of their annual turnover. Impacts Social media firms will invest more in automated filters -- regardless of their drawbacks. Removing extremist online content may impair law enforcement work by limiting their access to relevant materials and networks. Terrorist and extremist outfits will adapt to evade filters.

Moderation is waning in Italy-EU conflict

2019 ◽  
Keyword(s):  
European Commission ◽  
Euro Area ◽  
Fiscal Rules ◽  
Right Wing ◽  
Content Type ◽  
Borrowing Costs ◽  
Deficit Reduction ◽  
Parallel Currency ◽  
Excessive Deficit Procedure ◽  
The Eu

Subject Italy's budget conflict. Significance June 5 marked a resumption in hostilities between Italy and the EU, after the European Commission sent a letter to Rome saying its spending plans were breaking EU fiscal rules. The Commission will now begin the process of implementing an excessive deficit procedure (EDP) against Italy aimed at reducing its deficit and debt. This will likely involve deficit reduction measures that could precipitate the collapse of the populist government. Impacts If an EDP is blocked, efforts to launch it will start again in September if Italy’s budget preview shows Rome not complying with EU rules. An EDP could lead to higher borrowing costs and make it more difficult for Rome to reduce its excessive debt, which is around 132% of GDP. A League-led right-wing government would push for aggressive tax cuts, potentially leaving Italy in the same predicament that it faces now. The implementation of a parallel currency to boost the supply of money would fuel concerns that Italy is prepared to leave the euro-area.

Prospects for the EU to end-2019

2019 ◽  
Keyword(s):  
European Commission ◽  
European Parliament ◽  
Content Type ◽  
The Eu

Subject Prospects for the EU to end-2019. Significance Centrists will still be the dominant force in the European Parliament (EP), accounting for around 70% of its members (MEPs). Nevertheless, the fragmentation of the centre coupled with the rise of Green and Eurosceptic parties will limit the scope for consensus-based politics, potentially reducing the EP’s influence with the European Commission and Council.

Cancelling ECB-held sovereign debt would harm not help

2021 ◽  
Keyword(s):  
European Commission ◽  
Euro Area ◽  
Sovereign Debt ◽  
Government Debt ◽  
Economic Recovery ◽  
Member States ◽  
Content Type ◽  
Debt Cancellation

Significance The debate is timely, as in the next two months the European Commission will review the fiscal programmes of member states amid calls for further stimulus to boost economic recovery. Impacts The safest and surest way to cut sovereign debt in the most highly-indebted EU states will be by implementing growth-oriented investments. Further calls to cancel government debt will further fuel uncertainty at a time when consensus between euro-area states is most needed. Debt cancellation is highly unlikely because of opposition from euro-area countries with the lowest government-debt-to-GDP ratios.

Sign in / Sign up

Export Citation Format

Share Document