Open Europe : Cut through the chatter

[Politics.be]

Whether Britain is better off in or out of the EU depends on a series of tough choices UK GDP could be 2.2% lower in 2030 if Britain leaves the EU and fails to strike a deal with the EU or reverts into protectionism, according to a comprehensive new Open Europe report. However, in a best case scenario, under which the UK manages to enter into liberal trade arrangements with the EU and the rest of the world, whilst pursuing large-scale deregulation at home, Britain could be better off by 1.6% of GDP in 2030. The report concludes that a more realistic range is between a 0.8% permanent loss to GDP in 2030 and a 0.6% permanent gain in GDP in 2030, in scenarios where Britain mixes policy approaches. Open Europe’s Chairman Lord Leach said, “Brexit is unlikely to be the cataclysmic event some have claimed. However, transforming Britain into the deregulated, free trading economy it would need to become outside the EU sounds easy in theory, but in practice could come up against some serious political resistance within the UK itself. The worst scenario is if the UK leaves the EU and then pursues protectionist policies. If the UK puts as much effort into reforming the EU as it would have to in order to make a success of Brexit, the UK and the EU would both be better off.” Lord Wolfson, the Chief Executive of Next and an Open Europe advisory board member, writes in The Daily Telegraph, “Any agreement on the EU, in or out, will involve difficult choices. Open Europe’s landmark report contributes in two important respects. First, it strengthens our negotiating hand, clearly demonstrating that Britain could prosper outside the EU – Brexit is not a bluff. Second, it forces those who advocate leaving to set out a clear vision for Britain’s future after the break. They will have to choose between populist protectionism and xenophobia on the one hand or free trade and wholehearted globalisation on the other. Which way they jump will decide whether business backs them or not.” Source: Open Europe Intelligence The Daily Telegraph: Wolfson

Greek PM heads to Berlin amid warnings Greece will run out of cash in early April
Greek Prime Minister Alexis Tsipras will head to Berlin today to meet German Chancellor Angela Merkel. CDU Parliamentary faction leader Volker Kauder said, “We are not thinking about any other programme,” while his SPD counterpart Thomas Oppermann echoed him saying, “I expect that will present this list in his talk with Chancellor Merkel on Monday. I finally want to know whether Greece is ready for real reforms or not.” However, both sides have played down the hope of any progress in terms of detail with the meeting focused on easing hostilities between the sides. In a letter to Merkel ahead of the meeting Tsipras warned that it would be “impossible” for Greece to pay its obligations in the coming weeks if there is no disbursement of funding from the Eurozone soon. In the letter Tsipras was also scathing over the ECB’s refusal to allow the country to issue more short term debt to help fund itself.

Meanwhile, in an interview with The Financial Times, Spanish Finance Minister Luis de Guindos said, “There will not be any disbursement before there is a real test that the reforms have been approved and implemented.” He added, “Communications from the Greek side have not been brilliant. They have not made a lot of friends.” Separately, Frankfurter Allgemeine Zeitung reports European Commission President Jean-Claude Juncker has said, “I am reaching my limits .” The paper also reported yesterday that Greece will run out of money by 8 April, according to Commission calculations.

German tabloid Bild reports that Greek Defence Minister Panos Kammenos has revealed previously unseen documents claiming that German defence firms have paid more than €100m in bribes to Greek politicians in order to secure contracts. The paper reports that this includes Eurocopter, Rheinmetall, STN and ATLAS.

Source: Bloomberg Kathimerini Times The Wall Street Journal Bild Frankfurter Allgemeine Zeitung Frankfurter Allgemeine Sonntagszeitung
Front National obtains highest-ever score in a French local election
Nicolas Sarkozy’s centre-right UMP party – which was running on a ticket with centrist parties UDI and MoDem – won the first round of French local elections yesterday with 32.5% of votes nationwide. The anti-euro Front National finished second with 25% of votes – the party’s highest-ever score in a local election. French President François Hollande’s Socialist Party came third, as it only won 21% of votes. The second round will take place on Sunday 29 March. At the moment, it remains unclear how many of France’s 101 departments Front National will control.

French Prime Minister Manuel Valls yesterday urged all the mainstream parties to join forces and block Front National winning any of the run-offs. However, Sarkozy said that he will not give UMP voters any indication as to what to do in those constituencies where Front National will face the Socialist Party in the second round.

Source: Le Point Le Monde Le Figaro
Spanish Socialists to retain power in Andalusia as Podemos storms in as third-largest party
No Spanish party won an absolute majority in yesterday’s regional elections in Andalusia. The Socialist Party had the highest support and secured 47 of 109 seats in the regional parliament – unchanged from the 2012 elections. Spanish Prime Minister Mariano Rajoy’s Partido Popular won 33 seats, 17 less than in 2012. The anti-establishment party Podemos finished third with 15 seats, followed by centrist party Ciudadanos with nine seats and the United Left with five.

Socialist candidate for Andalusian President Susana D�*az has said she intends to “govern alone” – suggesting that she will try to set up a minority government. Open Europe’s Vincenzo Scarpetta is quoted by the Wall Street Journal and Swedish daily Dagens Industri as saying, “The general elections are still a few months away, but these results confirm that Spanish politics could really be in for a sea change this year.” Vincenzo also appeared on Radio France Internationale yesterday discussing the Andalusian elections.

Source: El Pa�*s El Mundo The Wall Street Journal
Ukraine will not repay $3bn bond owed to Russia
The Financial Times reports that, under IMF forecasts, Ukraine will not repay a $3bn bond due for repayment to Russia in December under Ukraine’s plans to restructure $15bn of debt over the next four years.

Source: The Financial Times
Brexit more finely balanced than thought

Open Europe’s seminal new Brexit report, ‘What if…? The Consequences, challenges and opportunities facing Britain outside the EU,’ is widely trailed in the papers. The Times writes the report is, “The most comprehensive analysis of the effects of Britain leaving the European Union,” and highlights how Open Europe finds that the impact of Brexit is more finely balanced than previously argued, “The worst case would see £56bn wiped off Britain’s economy by 2030… the analysis says that Britain could benefit by as much as £35bn from leaving the EU. However, that would involve retaining open borders and passing free trade measures.”

The Financial Times writes on the front page that, “the three most positive outlooks all depend on Britain maintaining a liberal Labour market with “familiar levels” of migration numbers.” Open Europe Director Mats Persson is quoted in The Guardian as saying, “You have some questions to answer exactly what you want to see outside…Is it the free trading Hong Kong-Britain with very liberal policies, including on migration, which is what is needed to make us competitive? Or is it…to shut the borders and shut the world out which would mean a net loss in terms of the UK’s GDP and economic competitiveness?” The report is also featured by The Daily Telegraph, Reuters, City AM, The Mail, The Independent and Italy’s Rai News 24.

Open Europe will be hosting a launch event for its report examining the impact of leaving the EU tomorrow evening with Lord Woflson, CEO of Next Plc, giving an opening speech. If you would like to attend please register here.

Bron: politics.be