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Feb 12, 2010

Euro zone recovery falters in fourth quarter of ’09

BRUSSELS, Feb 12 (Reuters) – Euro zone economic recovery
stumbled in last year’s final quarter as gross domestic product
barely expanded, dragged down by a poor German performance
despite healthy figures from France, data showed on Friday.

The 16-country currency area’s GDP edged up 0.1 percent in
the October-December period, compared with the previous quarter,
and contracted by 2.1 percent from the last quarter of 2008,
statistical office Eurostat said in a flash estimate.

Feb 11, 2010

EU pledges to support Greece, but offers no details

BRUSSELS, Feb 11 (Reuters) – European leaders sought to prop
up Greece with words of support at a summit on Thursday but
failed to offer concrete proposals to help the country tackle
its debt crisis, prompting a negative market reaction.

EU President Herman Van Rompuy told a news conference after
the summit that Europe was sending Greece a “clear message of
solidarity”, a line echoed by Germany and France.

Feb 11, 2010

EU seals deal to rescue Greece, details still murky

BRUSSELS (Reuters) – European leaders struck a deal to provide financial aid to Greece on Thursday, in an unprecedented move to stave off a broader crisis in the 16-nation bloc that shares the euro single currency.

The details of the package were not expected to be finalized until early next week, when EU finance ministers meet, but the bloc’s leaders suggested it could include some form of loans to Greece to help it service its debt and avoid a damaging default.

Feb 9, 2010

Greece should get EU support for pledges-Almunia

BRUSSELS, Feb 9 (Reuters) – European Union leaders should
tell Greece on Thursday that it will receive the bloc’s support
in exchange for clear budget commitments, EU Economic and
Monetary Affairs Commissioner Joaquin Almunia said on Tuesday.

EU leaders meet on Thursday in Brussels and are likely to
discuss the difficult budgetary situation of Greece amid growing
market concern that Athens may not be able to service its debts.

Feb 9, 2010

Greek woes set to dominate EU summit

BRUSSELS, Feb 9 (Reuters) – The financial woes of Greece and other euro-zone members are likely to dominate a European Union summit this week that was initially called to debate a long-term growth strategy for the bloc, diplomats say.

Tensions within the 16-country currency area, triggered by Greek fiscal woes and growing concerns over Portugal and Spain, are not yet on the formal agenda for Thursday’s summit but will be added or discussed intensively on the sidelines.

Joined by European Central Bank chief Jean-Claude Trichet, the EU’s 27 leaders will also discuss how to improve economic policymaking to boost long-term growth — a debate that will culminate in the adoption of the "EU 2020" programme this year.

"It would be inconceivable if Greece and others were not discussed at the summit. How can you debate a 10-year plan if you don’t know what will happen in 10 days," one EU official said.

An EU diplomat said the summit might yield a statement in support of Greece, but was unlikely to mention aid and would broadly stick to what the European Commission and the ECB have already said.

"If there is a reference to Greece, they (leaders) will not go beyond what has already been said," the diplomat said.

News that Trichet was cutting short a trip to Australia to attend the main session of the summit lent support to euro-denominated assets on Tuesday as investors speculated the summit could produce some form of support for Greece.

But the ECB played down the significance of Trichet’s early return, saying the change was made to ensure he did not miss a connecting flight.

European stocks, bonds and the euro suffered huge sell-offs last week as investors, long worried by Greece’s budget deficit and public debt, switched attention to Portugal and Spain, whose public finances have also been battered by the economic crisis.


The Commission and ECB have endorsed Greece’s fiscal austerity programme and urged Athens to implement it strictly. Neither have mentioned any bailout for the country.

The summit will be a test for Herman Van Rompuy, who will preside over such a meeting for the first time as the EU’s newly elected full-time president, a post created by the Lisbon treaty that went into force last December.

"The purpose of this meeting is primarily to discuss the direction of our economic policies for the years to come, in the form of a renewed strategy for jobs and growth," Van Rompuy said in a letter to EU leaders this week.

The general economic debate will be a prelude to talks on the EU’s 10-year strategy to replace its so-called "Lisbon agenda", which was to have turned the bloc into "the most dynamic and competitive knowledge-based economy in the world". Many economists call the agenda a failure.

Spain, which holds the EU’s rotating presidency until the end of June, has proposed sanctions for those that fail to meet the strategy’s targets, but many countries have rebuffed this.

The summit will also have to face up to criticism that the EU remains rudderless despite the new treaty, which was supposed to streamline the bloc’s decision-making.

"The leaders must come to a single logical conclusion: Europe needs more unity and more integration, otherwise the EU will cease to play its role on the global chessboard," said Guy Verhofstadt, head of the Liberals in the European Parliament.

Some diplomats say instead of solving problems, the EU’s main institutions — the Commission, parliament and the council of governments — are engaged in turf wars to boost their own powers as the new treaty is put into practice.

U.S. President Barack Obama’s decision to skip a summit with the bloc in May came as a blow to the EU’s hopes of boosting its global standing.

The EU was also excluded from a key round of global talks last December on battling climate change, and has faced criticism that its initial response to the disastrous earthquake in Haiti was weak.

Critics say Van Rompuy and Catherine Ashton, the EU’s new foreign policy chief, lack clout and international recognition. Advocates say they should be given time to prove themselves.

The summit will also discuss help for Haiti and ways to improve the EU’s response to natural disasters as well as plot strategies for talks on a deal to fight global warming.

(Editing by Noah Barkin)

Feb 3, 2010

EU vows to hold Greece to austerity, markets wilt

BRUSSELS/ATHENS (Reuters) – The European Union vowed on Wednesday to hold Greece strictly to an austerity plan to tackle the most severe debt crisis in the euro zone as market turmoil widened and Portugal gave investors a new fright.

The European Commission put Athens on an unprecedented short leash, demanding a mid-March interim report on progress in reducing its huge deficit, and quarterly updates thereafter, partly because of accumulated mistrust of Greek statistics.

Feb 3, 2010

EU backs Greek austerity plans, markets relieved

BRUSSELS/ATHENS (Reuters) – The European Commission endorsed Greece’s austerity plan on Wednesday but said Athens must take further steps to cut public sector wages to tackle the most severe debt crisis in the euro zone.

In an assessment closely watched by markets weighing up Greece’s credibility as a debtor, the European Union executive ordered Athens to submit an interim report on progress in reducing its huge deficit by mid-March.

Feb 3, 2010

EU endorses Greek deficit plans; urges more action

BRUSSELS, Feb 3 (Reuters) – The European Commission endorsed
on Wednesday a Greek plan to cut its budget deficit below 3
percent of GDP by the end of 2012, but said it must take further
steps to cut public sector wages and put finances in order.

In an assessment closely watched by financial markets
weighing Greece’s credibility as a debtor, the European Union
executive said Athens must submit an interim report on its
deficit reduction progress by mid-March.

Feb 2, 2010

EU to endorse Greek deficit cutting plan Wed

BRUSSELS, Feb 2 (Reuters) – The European Commission will
endorse on Wednesday a Greek plan to cut its budget deficit
below the EU ceiling of 3 percent of GDP by the end of 2012,
saying it was feasible despite risks.

The Commission’s assessment will be closely watched by
financial markets as they weigh Greece’s credibility as a
debtor. Sharp upward revisions to Greek deficit and debt figures
last year led to ratings downgrades and sent yields soaring.

Jan 26, 2010

Hungarian, Latvian fiscal plans on track – EU draft

BRUSSELS, Jan 26 (Reuters) – The European Commission will
tell Hungary and Latvia on Wednesday that they are on track with
their fiscal cutback programmes aimed at overcoming financial
woes, a draft report by the European Union executive showed.

The draft, obtained by Reuters on Tuesday, said Hungary had
taken sufficient measures to reduce its deficit to below the
EU’s cap of 3 percent of gross domestic product before the
agreed deadline of the end of 2011.

    • About Marcin

      "Based in Brussels, I cover macroeconomy, EU budget, issues related to central and eastern Europe. I previously worked in Warsaw as deputy bureau chief"
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