On Thursday, ex-President of the ECB, Jean Claude Trichet warned that the political and economic authorities would have little room to manoeuvre in the face of a new crisis after the central banks exhaust their QE.
Articles by Alexandre Mato
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The euro’s fourth biggest economy will not be the protagonist in long economic debates in 2017. Spain’s deficit and its domestic politics are no longer a concern for Brussels, now focused on the Brexit negotiations and worried about the complicated elections cycle in various countries.
Within the EU it is being discussed how to set up a fiscal backstop, a barrier of public money to be used in times of crisis, not just to help out a bank. One option being considered in Brussels is turning The European Stability Mechanism (ESM) into a kind of management tool for a crisis.
The European Commission (EC) opted against imposing fines on Spain and Portugal for their non-compliance with 2015 deficit targets. So Brussels did not implement the penalties equivalent to 0.2 percent of gross domestic product included in the Stability and Growth Pact for failure to comply with budget rigour. The fines would have amounted to about 2 billion euros for Spain and around €350 million for Portugal.
“The EU has to make itself attractive” in the wake of Brexit. Brussels is trying to force London to accelerate its departure process “as soon as possible, despite how painful that may be,” according to European Commission President Jean Claude Junker. During the European Summit on Tuesday, the the scenario for the new EU with 27 Member States will be presented.
Athens may need no further than €10 billion to recapitalise its main financial institutions. These are the funds in the Hellenic Financial Stability Fund to cover the sector’s requirements. Looks like in Brussels there is a broader consensus that the figures revealed by the ECB are “encouraging”.
The European Commission is trying to create a single market for capital across the continent to increase and diversify the funding sources for Europe’s business and long-term projects. In the EU, mid-sized companies received five times less money from capital markets than in the U.S.
BRUSSELS | In an attempt to win the public opinion battle, the European Commission has established an alternative judicial system to deal with cases between private investors and states. The previous investor-to-state dispute settlement (ISDS) had been widely criticised for favouring big corporate interests.
BRUSSELS | July 22, 2015 | By Alexandre Mato | Since the transfer of a €7 billion bridge loan, Greece has started negotiations with its international lenders and euro partners to complete a third rescue programme lead by the ESM. To repay its external obligations in August, the country will need a further multi-billion euro support from the EU.
BRUSSELS | July 7, 2015 | By Alexandre Mato | When euro leaders and their finance ministers meet with the Greek government later today for a fresh round of negotiations to agree on a new economic assistance programme, the debt issue will still be the mother of all battles. Over the last few days, some economists in Brussels have gathered together ideas for putting Hellenic public finances in order.