The Finnish government intend to push for an eco-efficient European economy when Finland assumes the EU Presidency in the second half of 2006.The inspiration will be the national Finnish programme for sustainable consumption and production. Back in 2002 the EU committed itself, during the Johannesburg Earth summit, to establish a ten-year framework programme for sustainable consumption and production, to date little has come of this.
Category Archives: A Few Euros More
EU 15 Not Up To Par On Kyoto
Total greenhouse gas emissions in the EU-15 decreased by only 1.7% 1990 – 2003, with CO2 alone growing by 3.4%, according to the latest statistics from the European Environment Agency.
Poland Cancels Referendum
Poland is now the seventh country to suspend its referendum plans. Denmark, Portugal, Sweden, Finland, Ireland and the Czech Republic have already done so. Portugal has ammended its constitution to make it possible to hold a referendum on EU related matters, but evidently there are no plans to hold any in the foreseeable future. Germany, I think, is still awaiting a judicial ruling on this topic.
Just A Fairy Story?
Or a real possibility: the euro at 1:1 with the dollar? The FT today cites one trader who thinks it a definite possibility. Of course, they also often quote others who hold a contrary opinion. So why do I pick up on this one? Because even though I don’t have access to the technical and currency market info, it fits in with my general reading of the respective underlying ‘macro’, and the way things could well evolve. Certainly the euro has been resisting strongly the push under the $1.20, and continually recovers ground lost. What you can say is that there is a lot of ‘volatility’ out there.
Paul Chertkow, head of global currency research at Bank of Tokyo-Mitsubishi, said a fresh impetus was needed to re-test the downside of the euros recent range, at $1.2020.
However, Mr Chertkow believes there are around $1bn worth of options in place below the $1.20 level, which could cause the euro to slide precipitously if triggered. We would have real panic, he says.
In this eventuality Mr Chertkow sees scope for the euro to fall as far as $1.10, or potentially, even parity against the dollar, led by euro-selling by US companies. American corporates have insufficient hedging ratios to protect a move on the downside through $1.20, he said. This would cause American corporates to capitulate.
Germans Cut Back On Credit
This news to the effect that German consumers actually reduced their outstanding debt is deeply significant in my view. What it reflects is what needs to be analysed:
“German private households ignored the attractions of historically-low interest rates and for the first time paid back more money than they borrowed last year.
The net credit repayment reported by the Bundesbank, Germany’s central bank, on Monday reflected the high level of consumer insecurity in Europe’s largest economy. It contrasted with the strong credit growth in other European countries, which has boosted consumer spending.
?There is nowhere else where a country comes even close to such weak growth rates,? said Julian Callow, economist at Barclays Capital.“
Luxembourg To Continue
Luxembourg will continue the ratification process and hold a referendum on July 10. The result will be interesting to see.
Parliamentary leaders in the tiny Grand Duchy agreed at a meeting on Monday to proceed with the vote even though opinion polls have shown a sharp rise in the “No” camp since French and Dutch voters rejected the treaty three weeks ago.
The vote could prove a gamble for Luxembourg Prime Minister Jean-Claude Juncker, who has said he will resign if voters reject the charter
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Demographics & The Stock Market
Brad Delong has an interesting link on how stock markets react to changes in demand demographics.
Italy Referendum Campaign Launched
The Italian Northern League have, as promised, launched their ‘bring back the Lira’ referendum campaign. Whilst at this stage there is something vaguely comic in all this, remember it is a wild card which will be floating around if Italy’s economic crisis worsens.
The Italian Northern League party launched a campaign to revive the lira at an 85,000-strong rally of its supporters on Sunday (19 June) The party, which holds minister posts in Silvio Berlusoni’s government, called for a revival of the lira as a “parallel currency” to the euro, which would remain the currency of the state budget, tourism and foreign trade. Under Italian law, a referendum must be held if half a million signatures are collected.
Well This Is A Reform…..
But in which direction does it lead…….?
German lawmakers approved a bill Friday that would allow older unemployed people to collect jobless benefits for longer than previously planned, a move that comes as the government struggles in polls ahead of elections expected in September.
In unpopular reform introduced earlier this year gradually scales down benefits for the long-term jobless to the level of social welfare payments. The new bill would give unemployed people above age 45 an extra two years of full-level benefits.
The Lisbon agenda, and all our policies associated with the ‘ageing society’ ar meant to lead to higher particpation rates in the over 55 age group, it isn’t clear to say the least how this fits in with that.
Italy’s Deficit Also Balloons
Italy posted a trade deficit with the rest of the world of 1.354 billion euros in April, widening sharply from a deficit of 155 million euros in the same month of 2004, national statistics office ISTAT said on Thursday. The deficit also increased from March, when it stood at 845 million euros.
Trade with European Union countries alone showed an April deficit of 368 million euros, compared with a 109 million euro deficit in April last year.
A 5.854 billion euro cumulative trade deficit with the rest of the world in the first four months of this year was the largest Jan-April deficit since at least 1991.
Italian imports from the rest of the world rose 6.5 percent year-on-year in April, far outstripping a 1.6 percent increase in exports. Imports from the EU in April were up 1.8 percent on the year, while exports were flat compared with the year before.
Source: Reuters via NTC Research
I don’t think I am being too alarmist if I say that something nasty is happening to the international competitiveness of Spain, Italy, Greece and Portugal.