Category Archives: A Few Euros More

All AFEM Blog Posts

French Franc Naustalgia

Posted on by

Well I’ve been reading about the Germans, the Italians, now apparently it is the turn of the French to feel naustalgic:

“Three out of five French people miss their old currency, replaced by the euro in 2002, a survey for Valeurs Actuelles magazine showed on Wednesday. In February 2002 that figure was just 39 percent.

While the rising tide of nostalgia seemed to chime with French voters’ rejection last month of theEuropean Union constitution, a breakdown showed longing for the franc was widespread even among those who support the EU project.”

I like that bit, “longing was widespread even among those who support the EU project”. This highlights the fact that it is perfectly consistent to feel pro EU and yet not want the common currency. Out of the wardrobe everyone.

Update: The Financial Times this morning also mentions the emergence of Philippe de Villiers, the leader of the nationalist Movement for France, as the champion of a referendum in France on continued use of the euro. According to the FT de Villiers, who is a leading anti-constitution campaigner, said a debate about Europe’s single currency was already under way in Germany, the Netherlands and Italy but had not properly started in France. ?Everybody notes today that the adoption of the euro was a technical success but its economic, political, and human toll is incontestable,?. Now much of the recent ‘ referendum euro’ talk comes from those who would predictably say what they are saying. They are normally not people with any special knowledge of the economics behind it, and I think no great significance should be attached, except the fact that these kind of comments are becoming commonplace, where they weren’t before. My guess is that debate about the euro will increase with time.

That Other Turkey

Posted on by

Far away from the hassle and turbulence of Turkey’s EU membership application is that other Turkey, the one that is growing and expanding, the economic Turkey. This time it’s cars:

“With a cluster of carmakers and part suppliers, the Turkish automotive sector has reached a critical mass and become an integral part of the global network of production bases. The country?s geographic location and demographics make it an ideal production (and distribution) centre for the mature European market as well as emerging markets in the Middle East and North Africa. Not surprisingly, the annual growth rate of automotive exports accelerated from 6.7% in the 1980s to 30.8% in the 1990s and to 42.6% in the last five years. Accordingly, Turkey now exports over US$10 billion worth of motor vehicles and parts to 170 countries, and there is no sign of a slowdown in the near future. The sector raised its international sales by 53.7% in 2004 and 43.9% in the first five months of this year, generating 20% of the country?s total export earnings. “

Spain’s Balance of Payment Deficit

Posted on by

I don’t have time to go into this much further right now, but Spain’s Current Account Deficit is ballooning enormously. According to figures realesed by the Bank of Spain today, Spain?s trade deficit increased to 6.56 billion euros in March. The deficit was up from 4.0 billion euros in the same month a year earlier. The full report from the Bank of Spain shows that:

El d?ficit acumulado de la balanza comercial se elev? en los tres primeros
meses del a?o hasta 14.736,5 millones de euros, desde 9.734,8 millones en igual per?odo del a?o anterior. En el per?odo enero-marzo, las exportaciones de mercanc?as aumentaron un 1,7%, en tasa interanual, mientras que las importaciones crecieron a un ritmo sensiblemente mayor, un 12,3%.

ie that the accumulated deficit on the commercial balance in the first 3 months rose from 9,734.8 millon euros, to 14,736.5, (an increase of 51% y-o-y). Exports increased 1.7% whilst imports increased 12.3%. Last year Spain had a trade deficit of 5% GDP, at this rate we could be heading for the 7-8% range in 2005. This *is* unsustainable, but no-one has any idea what to do about it.

Italians Don’t Vote

Posted on by

The low turnout – a 25.9 which fell far short of the necessary 50% minumum to secure a binding impact on parliament – means that the proposal to reform Italian law on assisted reproduction and embryo research effectively did not prosper.

In fact a majority of those who did vote voted to change the law.

This result is being widely covered as a ‘victory’ for the moral preachings of the new pope Benedicat XVI. I am sure it is nothing like that simple.

Czech Voters Becoming Constitution Sceptics?

Posted on by

Evidence is growing that the legacy of the French and Dutch votes will be more enduring than many of our leaders seem to have thought. Now a survey in the Czech Republic finds voters increasingly unwilling to vote the constitution.

The poll showed that 29 percent of Czechs would reject the constitution and 19 percent would support its ratification… More than a quarter of the population is not concerned whether or not the document will be ratified, and another quarter believe ratification is unnecessary in the current situation. “At present, the European constitution would not be approved in a referendum and in addition, a very small number of voters would have take part in it,” Jana Hamanova from SC&C said, in reference to the results of the poll.

This means that the EU constitutional treaty is not currently supported by the majority of potential voters of any of the parties represented in the Chamber of Deputies.

Czechia: Too Dependent On Automobiles?

Posted on by

This article asks an interesting question: is the Czech economy becoming too dependent on the car indusrty?

Helena Horsk?, an economist at Raiffeisenbank, said a concentration of investment in one industrial sector could be dangerous. One of the biggest risks, she said, is that as the economy becomes more reliant on the automotive sector, ?the economy [as a whole] will suffer when the industry hits a downturn in the business cycle.?…….Raiffeisenbank?s Horsk? added that GDP, employment levels and even the crown would be hit if or when a downturn comes to the automotive sector.”

Denmark In A Quandry

Posted on by

Danish foreign minister Per Stig M?ller seems to be in something of a quandry. He has given up hope that one clear message could be sent on ratification of the constitution when EU leaders meet for a summit later this week. At the same time he doesn’t seem clear what to do about the Danish referendum – due on 27 September – since Copenhagen has made it a pre-condition for asking Danish voters to go to the polls, that Paris and the Hague say clearly what they plan to do next. I think he will have to learn to live in hope.

Enlargement Issues Brewing

Posted on by

EU foreign ministers approved a protocol today adapting a customs union with Turkey to the 10 new member states, including Cyprus, in so doing they brought membership negotiations with Ankara one step closer. This ‘haste’ – cdecent or indecent – is not proving popular with everyone. The EU Observer is reporting that enlargement is definitely *off* the agenda for this weeks summit and EU external relations commissioner Benita Ferrero-Waldner has already indictated that in her view there should be a slow-down in enlargement.

This is being interpreted as meaning that Austria may even have reservations about Romania, and Bulgaria:

A senior official from one new member state said there were some signals, particularly from Austria, that it could be difficult to ratify the accession treaties of Romania and Bulgaria, due to join the bloc next in 2007.

Finally this does seem to be evidence of ‘indecent haste’:

Diplomats said EU president Luxembourg was pressing Ankara to sign the accord within the next three weeks, and if possible before Thursday’s EU summit, to cut short any attempt to call the negotiations into question in the light of public concern shown in the French and Dutch referendums.