LONDON | By BARCLAYS | The Portuguese government presented yesterday the draft Budget Law for 2014. Fiscal measures to be deployed amount to EUR3.9bn (2.4% of GDP), about 0.4% of GDP above the EUR3.3bn announced in May when the cabinet approved additional austerity measures to meet revised fiscal targets for this year and next (EUR1.4bn in 2013 and EUR3.3bn in 2014).
PARIS | By Ludovic Lamant at Mediapart via Presseurop | Disagreements between the European Commission and the IMF on how to end the debt crisis in Europe continue to grow. Starting in Brussels, it is possible to envisage the careful dismantling of the group.
LONDON | By BARCLAYS | EU Finance Ministers adopted the regulations that pave the way for a single bank supervision in the euro area. As we had expected, however, they failed to make significant progress on a single resolution mechanism. As long as the banking union remains incomplete, the link between banks and sovereigns will not be fully broken and financial fragmentation will continue to prevail.
LONDON | By Sigrún Davíðsdóttir | Thinking back to five years ago, Iceland was forced to take the right decisions, not saving the big banks. But that was perhaps the easy decision: after all, the major part of creditors in these banks were foreigners. Later on, frantic attempts were made to save the very Icelandic banks, i.e. Saga Capital, VBS and some saving societies. Now, the idea is to tax estates where foreigners are ca. 90% of creditors whereas other failed financial companies are not taxed. “Fuck the foreigners” was a policy after the collapse – and it still seems to be the only policy five years after the collapse.
MADRID | By Tania Suárez | European Red Tape has been subject to a lot of criticism due to its harsh conditions. A British Government report released on Tuesday claims that “EU regulation is strangling economic growth.” PM David Cameron said it was time for Brussels to “commit to more concrete measures to get rid of the unnecessary regulation which holds our businesses, and Europe, back.”
BERLIN | By von Dietmar Neuerer at Handelsblatt via Presseurop | Following an intiative by the German government, European environment ministers opted on October 14 to postpone sine die, a vote on stricter rules for CO2 emissions from passenger cars, which mainly targeted large German saloon cars, explains Handelsblatt.
LONDON | By BARCLAYS | Euro area industrial production rose significantly by 1.0% m/m in August, broadly in line with our expectations (+0.9% m/m, consensus: +0.8% m/m). This increase offset the drop recorded in July entirely.
THE CORNER | ECB executive board member Jorg Asmussen has said there are “pending risks” for Ireland as it prepares to exit the EU-IMF 85 billion euro bailout on December 15. Dublin is launching its seventh austerity budget in six years on Tuesday, under pressure to deliver a €2.5 billion package of more cuts and taxes without compromising the fragile recovery. Investors are watching closely.
BUCHAREST | By Ovidiu Nahoi at Dilema Veche via Presseurop| Life in the European Union appears better than in many other parts of the world. Yet, this well-being is undermined by the euro crisis combined with a loss of confidence by citizens in their institutions. This trend will be one of the major issues in the upcoming EU ballot.
MADRID | By JP Marin Arrese | The IMF’s warning on the hefty pile-up of corporate debt has triggered angry comments from top Spanish companies. The Washington-based institution has voiced concern about its destabilizing effect on financial solvency. A lingering recovery is likely to turn liabilities into soaring non-performing assets in banking balance sheets.