EU news focus

EU news focus: 6-12 December – Leaders’ view, posted workers, Up 2 Youth, EU-Ukraine-Russia, banking union

EU News Focus

In this week’s newsletter, we focus on the following five topics: some European leaders’ view on the future of the European integration; a deal to fight abuses to rules on posted workers; the EPP project “Up 2 Youth” to involve young voters in the #EU2014 electoral campaign; the role of the EU in Ukraine and criticism towards Russia; and progress on the second pillar of the banking union. Enjoy the reading and share with us your opinion about these topics!

Home Affairs

European leaders’ view on the future of the EU integration

José Manuel Barroso (President of the European Commission), Enrico Letta (Italian PM) and Mariano Rajoy (Spanish PM) expressed their views on the future of Europe in the course of last week.

Letta said at a conference on Europe that “anti-Europeans are myopic” and are focusing on differences to win an election and then “build ruins”. He described the “nationalism and chauvinism linked to where we live” as “stupidities” that we must fight with determination, starting with the campaign for the European elections. Furthermore, Letta insisted that we need to tell citizens what Europe does for them, e.g., the cut in roaming costs to make phone calls from abroad less expensive. This is particularly important as media do not focus on good news coming from Europe; on the contrary, “those who add fuel to the fire of things that do not work well in Europe are favoured”. According to the Italian PM, “if Europe stops going forward in the coming years, we won’t be able to protect what we have obtained so far: we will go backwards.” So, according to Letta, we must “reconstruct the European dream” and also “realise that we need to be united”. After the monetary union, we need to aim at the political, fiscal, economic and banking union: he says we need to achieve all 4 within 10 years. Moreover, the world is changing quickly and “Europe needs to choose between being decisive and influent or divided and without influence”.

Barroso, at the same conference, echoed the preoccupations about racism and xenophobia and called upon the intellectuals (because “culture and science have more credibility than politics”) “not to give way to defeatism to fight populism”. He also mentioned the situation in Ukraine and underlined that “Europe must support Ukraine because it gives us a great example of freedom and democracy”. He also insisted on the fact that “Ukrainians are fighting for their future, and not only because Europe is a land of opportunities”.

As to Rajoy, he was interviewed by several European newspapers. Despite the past and current difficulties and scandals, he now claims the future is going to be brighter. He highlighted the fact that European leaders were now starting to talk about economic growth and youth (un)employment, not only bailouts. Rajoy is also convinced that “European integration has been a success, one of the best things that has ever happened to {Spain]” and that further integration is the only solution. For Spaniards (at least, those who lived under the dictatorial regime of Franco), he says, “Europe means democracy, freedom, and progress”. He also called upon European leaders to better explain the benefits of more cooperation and of the internal market for citizens; indeed, the young generation does not realise the improvement compared to the situation when borders were not open. Despite the cuts in public expenditure, the Spanish PM also claims that the European (and Spanish) welfare State is not dead. Rajoy also declared that Spain was not like Greece and that his country had made many structural reforms to make Spain more competitive to stimulate growth. Now that his country has made efforts, he wants Europe to act as well, in particular by swiftly reaching a deal on the banking union. Another area where the EU shall act is the immigration: Rajoy says “Europe needs to co-operate to improve the levels of development and fight against the poverty in the countries of origin [of the migrants]”; “it should also work to make these countries respect human rights” and “it should collaborate with the authorities in these countries to fight against the mafia groups that control the traffic of people”.

Sources: La Stampa, The Guardian, El País.

Economy

An abusive use of posted workers?

The EU regulates the use of workers employed in one Member State and posted to another Member State through the Posted Workers Directive (PWD; 96/71/EC) of 1996. This directive has been subject of criticism for years because it allegedly facilitates “social dumping”, since the contract of employment needs to respect the rules in the Home State, not in the Host State (the one where the worker is posted), except for a minimum set of rules (e.g., the minimum wage).

In the past weeks, French politicians have launched another round of criticism after several abuses had been discovered in some sectors, in particular the construction industry and the temporary work agencies. That being said, it is worth noting that, contrary to populist fears, posted workers do not come only from central and eastern European countries, where hiring a worker costs much less than in some developed western European Member States. So, Germany and France are the 2 countries which receive the most posted workers, but are also 2nd and 3rd in the ranking of Member States who post the most workers abroad. In total, in the EU, there would be around 1.2 million posted workers.

In March 2012, the European Commission presented a proposal of Posted Workers Enforcement Directive (PWED), but there was no agreement between Member States: the UK and the central European countries tend to be against limitations to free movement, while countries such as France and Germany want stricter rules. Any reform needs to balance ‘anti-dumping’ rules with the workers’ right to free movement.

Now, on December 9th, the Council finally found an agreement to fight the abusive use of the PWD. This was made possible partly by Poland’s decision to join the group of those wanting to reform the 1996 directive. Member States will have the right to require more documents when realising controls. However, they will need to notify to the Commission the measures they will take to implement the new deal, to make sure these measures remain “proportionate”. Moreover, in the construction industry, businesses will be responsible for fraud committed by their subcontractors. This “joint and several liability” scheme can be optionally extended to other sectors.

Sources: Le Monde (Q&A, deal), EU Observer.

Citizenship

Up 2 Youth: the initiative of the EPP ahead of the #EU2014 elections

Political parties currently try to figure out how to better involve electors, in particular young people, in the European elections which will take place in May 2014.

The EPP, together with its youth branch, the YEPP, its think-tank, the Centre for European Studies (CES), and the European Democrat Students (EDS), has launched an online platform where young voters (18-30 years old) can give an input to the EPP programme by saying what should be the top issues and how to address them.

The best proposals will have a chance to be incorporated in the EPP electoral manifesto. Moreover, the 10 participants with the best proposals will be invited to the EPP Congress in Dublin, early March, where the EPP candidate for President of the European Commission will be revealed. Finally, the author of the best proposal will win a 6-month paid internship at the CES.

All information about the “Up 2 Youth” initiative is available here! And do not forget to tell politicians how you would address issues which matter to you!

International Relations

The developments in Ukraine and in the EU-Russia relationship

As the tension on Maidan Square in Kyiv increased, EU High Representative for Foreign Policy, Lady Catherine Ashton, went to Ukraine to meet the President Yanukowych and the leaders of the opposition and civil society in an attempt to prevent repression and find a peaceful solution to the demonstrations that have been lasting for over 2 weeks now. She urged the President to refrain from using violence against peaceful demonstrators who are determined to obtain new elections. Lady Ashton’s mission initially had a mixed success: although she has been received by the President for a very long meeting, during which she restated that the deal between the EU and Ukraine was still on the table, only hours later the police charged the crowd to regain some land in the centre of Kyiv. Moreover, the day before, the police had raided the seat of the biggest opposition party. However, until now, it seems that the police and the government will not resort to full repression. The Ukrainian leadership has sent contradictory signals about getting closer to the EU, saying that it could sign the deal if the EU offers financial support worth €20 billion. The EU rejected this option. Lately, it seems that the Ukrainian government could sign the deal “soon”: the vice-PM stated he talked to Stefan Füle, the EU Commissioner for enlargement and neighbourhood policy, about a timetable. The EU answered that it was ready to support the move and prepare a roadmap for the implementation of the agreement if Ukraine shows a clear will to sign it. Moreover, the Ukrainian minister of Foreign Affairs suggested that an influential foreign negotiator should help to bring the government and the opposition to the table of negotiation. The opposition supports such an idea. This may be another task for Lady Ashton.

Meanwhile, another type of reaction from Western leaders emerged when the German President, Joachim Gauck, announced he would not go to the Olympic Games due to take place in Sotschi (Russia) next year. Mr Gauck regularly criticises the violations to the rule of law and human rights in Russia. His decision to boycott the Olympic Games was criticised in turn by pro-Putin politicians. Other politicians in Europe followed, such as the new Luxembourgish minister responsible for sport, the socialist Romain Schneider, and the EU Commission Vice-president Viviane Reding to protest against the mishandling of minorities and the opposition.

Sources: Spiegel (police offensive, potential signature of the deal, Gauck, Reding), Luxemburger Wort, BBC, Euractiv, La Croix, EEAS statements (raid, visit to Ukraine).

Industry/Technology/Business

Progress on the path towards the banking union

The 28 ministers of Finance meeting this week have finally reached a pre-agreement on the second pillar of the banking union: how to deal together with banks in trouble, in particular how they would be refinanced in the future to avoid a repetition of the extremely onerous bail-outs that took place in the recent years and brought countries such as Ireland on the brink of bankruptcy. So, the new directive established a bail-in mechanism: first, the owners of a bank near bankruptcy will have to pay, then its creditors, then the people having deposits above €100.000, and only then the taxpayers. National resolution funds will be financed by banks: they will have to gather an amount of 1% of guaranteed deposits within the next 10 years. Banks with riskier activities will have to contribute more to the resolution funds.

In addition, the decision to shut-down a bank would be requested by a “resolution council” made up of national authorities. The Commission would then take the decision.

These rules shall be applicable from 1 January 2016. The deal should be finalised on December 18th, during another meeting: the Italian and Spanish ministers hinted that there was still significant work to do at the legal level.

Meanwhile, a single European resolution mechanism for the Eurozone is still being negotiated by Member States. Until now, Germany showed it is not keen on a single fund potentially backed by the ESM. However, such a single fund is considered to be indispensable to break the vicious circle between bank debt and sovereign debt in highly-indebted European countries.

Sources: EU Observer, Le Monde, Il Sole 24 Ore.

Next week…

The programme of the European Parliament is available here. Among the hot topics discussed in committee meetings next week: the banking union (after the latest evolutions), ensuring aid to the most deprived is preserved under the 2014-2020 MFF, a new round of talk about the Tobacco directive, opening the passenger rail services to more competition, and continuing to improve the rights of air passengers.

On the Council side, many meetings are scheduled. The Foreign Affairs Council will meet on Monday. The Agriculture and Fisheries Council meets on Monday and Tuesday. The General Affairs Council will meet on Tuesday. And finally, there will be the December reunion of the European Council on Thursday and Friday.

Sources: EP website, Lithuanian Council presidency website.

Pierre-Antoine KLETHI

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