Open Europe : Daily Press Summary
 

Cyprus turns to Russia after parliament votes against deposit levy and eurozone bailout; Open Europe flash analysis: Cypriot membership of the eurozone hangs in the balance The Cypriot parliament last night voted to reject the proposed deposit levy with 36 MPs voting ‘No’, 19 abstaining (all from the governing DISY party) and none voting in favour, putting Cyprus’ bailout and eurozone membership in doubt. In response to the vote the ECB reaffirmed that it will extend liquidity to Cypriot banks “within existing rules”. German Finance Minister Wolfgang Schäuble warned this liquidity would not “last until June” and warned that “without the money from the ECB [Cypriot banks] are insolvent”.

Cyprus is now scrambling to find an alternative, with Finance Minister Michalis Sarris in Moscow today for a meeting with his Russian counterpart. The WSJ reports that Sarris has asked Russia for a €5bn loan as well as an extension of the five year €2.5bn loan Russia gave to Cyprus in 2011. At the same time Cypriot President Nicos Anastasiades will meet with leading Cypriot politicians to try to find a plan they all agree on. Plans being discussed include: separating bad assets from Cypriot banks into a bad bank, using excess cash from social security funds to aid the government, or swapping deposits into longer term bonds to aid banks.

Kathimerini reports that the banks may stay closed until Tuesday next week and that capital controls may be implemented to limit the level of transactions once they do open. Open Europe released a flash analysis last night in response to the vote, noting, “The vote leaves Cyprus’ place in the eurozone hanging in the balance…though the most likely outcome is that the Cypriot parliament votes a second time, on a revised deal.” The analysis outlines four potential scenarios: Cyprus votes again and approves the deal, the eurozone blinks and adjusts the deal, Cyprus finds alternative funding through Russia or Cyprus exits the eurozone.

Open Europe’s flash analysis is quoted by City AM, Zerohedge, the Telegraph’s and Guardian’s live blogs, Spanish daily El Mundo, Slovakian daily HN, Greece’s SKAI TV and several other Greek and Cypriot outlets. Open Europe Director Mats Persson’s Telegraph blog was mentioned by Cypriot MP Andros Kyprianou in a round-up of comments from foreign experts during the parliamentary debate ahead of yesterday’s vote. The FT cites Open Europe calculations on the size of banking sectors in the EU, noting that banks in Ireland and Cyprus have assets equal to seven and a half times their GDP last year. Open Europe’s Raoul Ruparel appeared on RTE Drivetime, Polish National Radio and the Voice of Russia discussing the crisis.
Open Europe Flash Analysis Kathimerini Kathimerini 2 Kathimerini 3 Kathimerini 4 FT CityAM WSJ WSJ 2 WSJ 3 Reuters IHT Independent Guardian EUobserver FT 2 CityAM 2 Mail Irish Independent Times Reuters 2 Reuters 3 NOS TV Washington Post Spiegel Eurotopics Diário de Not�*cias Eurotopics Rzeczpospolita Eurogroup statement Telegraph Irish Times Irish Times European Voice Euractiv BBC BBC: Peston HN El Mundo Telegraph: Live blog Telegraph: Live blog 2 Guardian: Live blog SKAI Economista EUobserver 2

German media concerned by strongly anti-German Cypriot protests
The German media all pick up the strongly anti-German and anti-Merkel tone of the protests in Cyprus yesterday, with Bild reporting that a group of protesters took down the German flag from outside the country’s embassy on Monday evening. A representative of Cypriot President Anastasiades is quoted in the paper as saying that during the negotiations over the bailout deal, “the Germans held a gun to our chest”.

Spiegel Online reports that SPD Chairman Sigmar Gabriel has strongly criticised Angela Merkel for her role in the Cypriot crisis, claiming she had tried to “expropriate small depositors while letting bank owners off scot-free”.

Bild columnist Hugo Müller-Vogg argues that “If it was not an issue of Europe’s future, there would only be one appropriate response: deal with your own mess”. Meanwhile, Die Welt’s foreign affairs editor Clemens Wergin argues that “It is high time to restore the right balance to the relationship between responsibility, risk and liability. This means that whoever is responsible for the mess or whoever stands to directly benefit from an aid package ought to participate in the rescue efforts.”
Bild Bild 2 Bild: Müller-Vogg Welt Welt 2 Welt: Wergin FAZ Spiegel Süddeutsche FAZ FAZ 2 FAZ 3 FAZ 4 Süddeutsche 2 Süddeutsche 3 FT: Wolf FT: Atkins CityAM: Lilico CityAM: Heath FT Editorial FT: Afanasiev Irish Times: Beesley

The RAF yesterday flew €1 million in cash to the 3,000 British military personnel in Cyprus as “a contingency measure”.
WSJ Times

The Telegraph reports that an academic paper commissioned by the Department for Communities and Local Government estimates that 12,769 Romanians and Bulgarians will enter the UK after migration restrictions are lifted at the end of the year. However, Communities Secretary Eric Pickles said, “I don’t have any confidence” in the figures and “the truth is nobody really knows.”
Independent Telegraph Open Europe research: EU migration

Euractiv reports that MEPs and national diplomats are to begin talks today on finalising EU rules on bankers’ bonuses. The UK will “ask for marginal changes but they cannot change the fundamental direction,” said an EU diplomat. Meanwhile, on Thursday MEPs will vote on whether to support a cap on fund managers’ bonuses proposed by German Green MEP Sven Giegold.
Reuters Euractiv Open Europe research: financial regulation

A deal was reached yesterday to make the ECB the single bank supervisor for the eurozone after member states agreed to give greater powers to the European Parliament over the appointment of top officials in the new body. The deal also included the new double majority voting system for euro and non-euro members in the European Banking Authority.
Open Europe analysis: European Banking Authority Open Europe research FT WSJ Rzeczpospolita European Voice

Writing in City AM Dalibor Rohac cites Open Europe’s finding that between 1998 and 2010, the overall cost of regulation in the UK was £176bn.
Open Europe research: Still out of Control City AM: Rohac

UK outnumbered in fight against moves to re-instate direct subsidies for food production under the CAP
PA reports that the UK and other reform-minded member states were last night outvoted in the Council of Ministers, which decided to increase direct, production linked subsidies under the EU’s controversial Common Agricultural Policy (CAP). MEPs had voted to re-instate them last week. UK Environment, Food and Rural Affairs Secretary Owen Paterson has said that he will continue to fight to "decouple" the link between farm subsidies and food production: “It’s disappointing that the council proposed they continue, but today's agreement is still a clear improvement on the European Parliament's proposal for 15% or even 18%. We continue to fight for a common low rate.” Ministers also voted to give national managing authorities greater scope to tailor the so-called ‘greening measures’ to regional needs. Negotiations over the whole CAP are expected to continue until June.
Open Europe Research: CAP FAZ Euractiv European Voice EUobserver RTE Irish Times Süddeutsche

Italian President Giorgio Napolitano has this morning started official talks aimed at forming a government. He is due to meet the two parliamentary speakers and caretaker Prime Minister Mario Monti today, while talks with centre-left leader Pier Luigi Bersani, Silvio Berlusconi and Five-Star Movement leader Beppe Grillo are scheduled for tomorrow.
Repubblica Repubblica 2 Il Sole 24 Ore

French Budget Minister Jérôme Cahuzac resigned yesterday after being placed under investigation over tax fraud allegations. Cahuzac has been replaced by Europe Minister Bernard Cazeneuve, and Thierry Repentin has been appointed as the new French Europe Minister.
Times Les Echos FT FT2 Le Monde Le Figaro Les Echos Guardian

DPA reports that former German Chancellor Gerhard Schröder, writing in Cicero magazine, has called on his successor Angela Merkel to ensure that Turkey is eventually allowed to be become a full EU member.
Open Europe events: Turkey, the UK and Europe

Reuters cites Manfred Bergmann, European Commission director for indirect taxation, as saying that “There is no risk that the City of London will be negatively impacted ... There is no extra burden on non-participating member states to collect the tax. Will the City of London be forced to collect tax for Germany and France? No.”
Reuters

Spanish Prime Minister Mariano Rajoy told parliament this morning that the Spanish government is going to revise its macroeconomic forecasts for 2013, without giving further details.
El Mundo Expansión

According to the EU’s statistics office Eurostat, Belgium and France will have to include last year’s €5.5bn bailout of banking group Dexia in their budget deficit calculations. This will push Belgium’s deficit above the target of 3% of GDP.
EUobserver

The Express reports that new EU rules coming into force today will mean that an additional 15 boxes on the MoT checklist will need to be ticked before cars are deemed to be roadworthy.
Express

The EU’s Ambassador to Ukraine Jan Tombinski has said if an association agreement with Ukraine is not signed this November, the deal is likely to be shelved reports EUobserver.
EUobserver

Bron: politics.be