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Finnish Foreign Minister: Break-up of the eurozone would not mean the end of the EU; Austrian Foreign Minister: We must be able to expel countries from the euro

17 Aug 2012

In an interview with the Telegraph, Finnish Foreign Minister Erkki Tuomioja issued a stark warning about the future of the euro, saying, “We have to face openly the possibility of a euro-break up…It is not something that anybody [is] advocating in Finland, let alone the government. But we have to be prepared…Our officials, like everybody else have some sort of operational plan for any eventuality.” Tuomioja added, “The break-up of the euro does not mean the end of the European Union. It could make the EU function better.” Finnish Europe Minister Alexander Stubb this morning said that Tuomioja comments did not reflect the position of the Finnish government.

True Finns leader Timo Soini said, “There are no rules on how to leave the euro but it is only a matter of time. Either the south or the north will break away because this currency straitjacket is causing misery for millions and destroying Europe’s future…It is a total catastrophe. We are going to run out of money the way we are going. But nobody in Europe wants to be first to get out of the euro and take all the blame.”

In an interview with Austrian daily Kurier, Austrian Foreign Minister Michael Spindelegger said, “We need the possibility to throw someone out of the monetary union.” Without mentioning Greece directly , he added, “If such a rule already existed, one would have already had to draw the consequences.” Spindelegger suggested that countries like Germany, Finland and the Netherlands would support the idea.
Telegraph: Tuomioja EUobserver Kathimerini Reuters Economic Times Handelsblatt: Hennerkes Economist Economist 2 Economist 3 Sole 24 Ore La Tribune Kurier: Spindelegger

Dutch Socialists want referendum on fiscal pact and any further transfers of sovereignty to EU
Emile Roemer, the leader of the Dutch Socialist Party, which is leading the polls ahead of  next month’s elections, has said that any further transfers of sovereignty to the EU from the Netherlands would need to be ratified in a referendum. A spokesman for the party said this commitment included the fiscal treaty. “Economic policy can and must not be reduced to a set of rules which prescribe debt reduction,” the spokesperson told Reuters. “We...will resist the treaty on stability, coordination and governance,” he added.
Reuters EUobserver NRC FD Telegraaf

Greek government will not request bailout extension until October
Kathimerini reports that Greek Prime Minister Antonis Samaras will not officially ask for an extension of the bailout programme when he meets with European leaders next week, but will likely make the request at the October EU summit. The paper suggests that the Greek government is keen to agree on a credible plan to meet the additional €11.5bn in cuts for the next two years in order to ensure the disbursement of the next €31bn tranche of bailout funds, before it makes a formal request. The SYRIZA opposition party lambasted the government for simply toeing the line and implementing the same austerity policies as before the election.
Kathimerini Kathimerini 2 Kathimerini 3 Sole 24 Ore FTD

Italian Europe Minister: Italians will have to be given their say over “what the EU of tomorrow should be”
In an interview with La Repubblica, Italian Europe Minister Enzo Moavero Milanesi said, “The time has come for Italy to look beyond the crisis and face with greater – even critical – attention an in-depth debate over what the European Union of tomorrow should be. And it is clear that, both during and at the end of such a reflection, the [Italian] parliament and the citizens will have to be given their say.” He added, “If one thinks that the path of [European] integration is outdated or has gone beyond what is necessary, then one needs to indicate an alternative path.”
Repubblica: Moavero Milanesi

Handelsblatt: Commission’s plans for banking union would see all major eurozone banks under ECB supervision
According to Handelsblatt, the European Commission’s proposals for banking union, due next month, would give the ECB supervision over all of the eurozone's major banks, including Germany's savings banks and cooperative banks. Germany had hoped the plans would be limited to just the 25 biggest eurozone banks. National authorities would supervise day-to-day business and the ECB would only intervene where it saw “dangerous risks”, the paper reports. Outside the eurozone, national banking supervisors would stay in charge of their banks.
Reuters Les Echos Handelsblatt FT

New figures published by the Bank of Spain this morning show that the level of loans in arrears held by Spanish banks reached 9.42% of total loans at the end of June.
Expansión Expansión 2 El Economista Libération Le Monde Irish Independent La Stampa

The WSJ reports that Dutch banks are coming under increasing pressure from rising losses on their domestic real estate loan books as the sector struggles with structural overcapacity and the knock-on effects of a weak economy.

The Vancouver Sun notes that, on her trip to Canada, German Chancellor Angela Merkel gave Canadian PM Stephen Harper strong public support for an EU-Canada free trade deal to be agreed by the end of the year.
Vancouver Sun Toronto Star Local.de

European shares hit a five-month high yesterday as investors responded positively to comments from German Chancellor Angela Merkel which suggested she supported ECB President Mario Draghi’s ‘do whatever it takes to save the euro’ approach.
FT Irish Independent Corriere della Sera Sole 24 Ore Repubblica

Following the dismantling of Roma camps around French cities, French government officials are now considering lifting working restrictions for Bulgarian and Romanian nationals in an effort to provide a legal status for the 15,000 Roma from these countries living in France.
EUobserver Le Figaro Economist European voice Euractiv

Ireland is pressing the EU to consider sanctions against Iceland as they struggle to agree on mackerel fishing quotas. The European Parliament will vote next month on a measure which could be used to ban imports of Icelandic fish reports the FT.

Reuters reports that the EU is considering banning branding from cigarette packets.

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