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Economic Recovery Watch 11 March 2010

Economic Recovery Watch 11 March 2010






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    Economic Recovery Watch 11 March 2010 Economic Recovery Watch 11 March 2010 Document Transcript

    • Centre For European Studies ECONOMIC RECOVERY WATCH “Watchtower” Some short answers to some complex FAQs in the Euro crisis Foreword by CES Head of Research 1. Are speculators to blame for Greece’s and the entire Eurozone’s) troubles?The very short answer is: no, no and no again. The longer answer is: Whatever the market’s allegedexcesses, speculators can only successfully speculate against countries whose governments haveallowed them to get into such a position of weakness. That was true for many countries, such asBritain in the early nineties when the Pound got into trouble. Markets in this context are like a mirror,and blaming them is like on overweight person blaming the mirror for giving a realistic picture. On thequestion to what extent speculation with credit default swaps (CDS) has made it harder for Greece towork itself out of the current predicament, there are voices that the danger from CDS has been greatlyexaggerated. 2. Will stronger regulation and even prohibition of certain types of speculation help?Regulation certainly makes sense concerning stronger instruments for the EU and/or the EuropeanCentral Bank to better monitor the implementation of the stability pact criteria, especially to blow thewhistle on excessive debt in individual Eurozone countries. But when talking about easier sanctionsagainst countries violating the stability pact, we will very soon hear the familiar protest that punishingtrespassers will only make it harder for them to straighten out their budget. As to prohibiting CDSaltogether, or exclude companies from the market, it is understandable that politicians make thesedemands now. But actually implementing such a profound interference into financial markets may yetcome to haunt us. CDS as such are an entirely sensible instrument of hedging against risk. Any attemptto curb their use will also have costs that are worthwhile to be discussed. 3. Does a European Monetary Fund make sense?Of course, but it won’t help in this Euro crisis because it would take much too long to set up in order tosave Greece and other Eurozone countries from defaulting. About the question of what an EMF coulddo that the IMF couldn’t do, there is a whole spectrum of experts’ opinions. But everyone agrees thatit would be rather humiliating for the Eurozone countries to go hat in hand to the IMF. Some add thatthe mere proposal of an EMF is a way to send a message to the German electorate that Germanywon’t bail out Greece or future potential defaulters single-handedly. But the crisis we’re in now willhave to be tackled without an EMF, that much is for certain. www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.EU Member StatesAustriaThe coalition government has announced drastic plans for higher taxes next year in its bid to reducethe Austrian budget deficit. The Social Democrat Chancellor and the People’s Party Finance Ministerannounced on 9 March that the coalition planned to spend 1.7 billion euros less next year, whileadding that the plan was to take an additional 1.7 billion euros in taxes at the same time. The tworemained tight-lipped about tax increases or the introduction of new taxes, as the government hadrecently agreed on a so-called bank solidarity tax which it hoped would bring in around 500 millioneuros per year. But the Austrian Economy Chamber (WKO) warned that it would be a mistake forAustria to “go it alone” in imposing a tax on banks. WKO claimed that banks had little room forfinancial maneuver after suffering declines in their own capital during the recession, and that thereshould be an international tax on financial transactions instead. The trade union movement, however,reacted positively to the tax, but said it would constitute only a small part of a needed package ofmeasures to reduce debt and increase social justice. On a related topic, according to an Austrian think-tank it will take until 2012 for all the countries in Central and Eastern Europe to recover from theglobal economic crisis. The Vienna Institute for Comparative Analysis (WIIW) said that some CEEcountries will experience economic growth this year. But the body warned it will be another twoyears before the entire region is back on track. These predictions come after the Austrian Institute forEconomic Research (Wifo) revealed that the country’s companies have drastically reduced investmentin the CEE region, spending only 0.7 billion euros on investment activities in the region in the first ninemonths of 2009, a throwback to 1998 figures.BelgiumBelgian Prime Minister Yves Leterme has come forward with a proposal on a common finance ministryor debt agency for the eurozone to tackle problems highlighted by Greece’s debt crisis. In an articlepublished in Financial Times Deutschland, he described the EU’s Stability and Growth Pact as aprovisional solution and suggested going one step further with what he called the European DebtAgency, which would become responsible for the issue and administration of government debt in theeurozone, while still ranking below national financial ministries. For existing debt, member stateswould continue to pay varying interest rates corresponding to their credit ratings. When old debt ofindividual nations matures, it would be replaced by common debt of the euro zone, thus making everymember state guarantee the debt of other countries. In the banking sector, Belgian-French financialservices group Dexia swung back to profit in the fourth quarter aided by a capital gain from a stakesale, announcing that it plans to pay a dividend in shares. The fourth-quarter result benefited from anet capital gain of 151 million euros from the sale of Dexia’s 20 percent stake in Credit du Nord toSocieté Generale. Dexia announced one month ago that the European Commission had provisionallyagreed its restructuring plan following its state-led bailout from September 2008. In the businesssector, Belgium’s dominant telecom operator Belgacom reported revenue and profit just aboveanalyst expectations on Friday and reassured investors with a dividend forecast for 2010. Royal Bank www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.of Scotland analyst Marc Hesselink said in a research note that the positive results at Belgacom were arelief after the disappointing outlook from Belgian rival Mobistar earlier this month.BulgariaBulgarian Prime Minister Boiko Borisov said that the country has taken measures to ensure thatoutflow from Greek bank subsidiaries in the country will be prevented. 30 per cent of banks inBulgaria are owned by Greek lenders, and they account for 20 per cent of the country’s credits and 30per cent of its deposits. The Bulgarian Prime Minister also confirmed that the European Central Bankand other relevant bodies have been made aware of the situation. He expressed confidence that acrash in the Bulgarian banking system would be avoided, after economists had expressed concern overthe potentially negative impact that the Greek situation could have on the country. However, FinanceMinister Simeon Djankov has confirmed he has asked the International Monetary Fund and theBulgarian central bank to keep him informed of the situation, and to provide him with continuedreassurance. Bulgaria, the EU’s poorest member, has been badly hit by the economic crisis. Thecentre-right government voted an austerity budget for 2010, which, amongst other things, cut healthspending by 24 per cent. Following widespread protests by general practitioners in Sofia, the Bulgariangovernment has announced that it is to raise healthcare taxes in order to pump an extra 350 millionlevs ($244.9 million) into the medical system. The doctor’s union has declared that doctors will notwork until outstanding payments to them are made.CyprusIn 2009 the European Investment bank (EIB) provided a total of 202 million euros to Cyprus, mainly forsmall and medium enterprises (SMEs), as well as for energy. Together with the Bank of Cyprus, MarfinPopular Bank and Hellenic Bank, it supported the real economy and helped reduce the negativeimpact of the crisis by easing SME funding in the difficult period. Through these operations, the EIBprovided 138 million euros to support SMEs and small and medium infrastructure investments carriedout by private or public bodies, including local authorities, as well as beneficiaries of any size. Thisfinancing is available for investments in the fields of industry, tourism, services, knowledge economy,energy and environmental protection in Cyprus. The EIB also funded Orites, the largest and mostadvanced wind farm in Cyprus. This paves the way for further developments in the sector and bringsthe Cypriot government closer to it and the EU’s targets for renewable energy production. Speaking ata conference organised by AKEL womens movement, President Demetris Christofias said thatvigilance is necessary in order to avert the deterioration of the economy. He said that experts haddescribed the measures taken last year as sufficient, adding however that it seems that the globalfinancial crisis was deeper than what the experts had initially predicted. Christofias also pointed tothe need to combat tax evasion, which deprives the state of hundreds of millions in revenue, and saidthat better planning of social benefits is necessary. Finance Minister Charilaos Stavrakis has alsowarned that unless steps are taken, Cyprus budget deficit will grow from 6.1 per cent to around 7 percent in 2010 and 10 per cent in 2013.vvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvv www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.CzechcRepublicOn the 22nd of February 2010, the Executive Board of the International Monetary Fund (IMF)concluded the Article IV consultation with Czech Republic. The Executive Directors noted that theCzech Republic entered the crisis from a strong macroeconomic position, bolstered by integration withthe EU and sound policies. However, spillover effects have taken their toll on the highly open Czecheconomy. Between August 2008 and December 2009 the Czech National Bank cut the policy rate by275 basis points, while automatic stabilizers and fiscal measures widened the budget deficit by 4 percent of GDP in 2009. The real output decline is estimated to be 4⅓ percent in 2009. The recovery ofthe Czech economy is expected to be gradual. GDP is projected to grow by 1½ per cent in 2010,supported by exports and a buildup of inventories, while fixed capital formation will remain depressedand consumer spending is expected to decline. The tax hikes approved as part of the 2010 budget areexpected to push average headline inflation to over 1½ percent in 2010, but still below the target of2 per cent.DenmarkPost Norden, the result of the recent fusion of Post Danmark and Sweden’s Postn AB, announcedtoday it will be forced to cut 2,000 jobs in Sweden and Denmark. The impending layoffs are due to adifficult 2009, according to the company, where earnings suffered as a result of both the financialcrisis and the transition to electronic mail. Many economists are expecting the national deficit toexceed 100 billion and according to the figures, for every hour a private employee works, it generates150 kroner for the state coffers. If, as economists have predicted, 190,000 jobs are lost during therecession, it will mean a deficit of about 47 billion kroner annually for the state. In addition, the statewill face the added expenditure of paying out unemployment benefits and early retirement to thosewho have lost their jobs. The slump of the Danish housing market that began in late 2008 has resultedin homeowners struggling with huge debt. The cost of housing in Denmark has also soared to one ofthe world’s highest levels over the past several years, making the market slump seem worse forhomeowners. Other studies have also shown that personal debt in Denmark is very high in relation toincomes. Another explanation for the high Danish debt is the unique their mortgage credit system,which makes it relatively easy to borrow relatively large sums to buy property. On a more positivenote, Danish toy manufacturer Lego posted record profits for 2009, according to its annual reportpublished today. The company’s net profits for the year amounted to 2.2 billion kroner – an increaseof 850 million compared to 2008’s figures. Revenues for 2009 also increased dramatically from theprevious year, by 22.4 percent, going from 9.52 billion kroner to 11.66 billion. While Lego announcedrecord profits for 2009, things were quite the opposite for Denmark’s biggest company, A.P. MollerMaersk, which posted net losses of 5.5 billion kroner for the year. It is the first time in the company’shistory that it has had negative earnings for a year, and the drop from 2008’s figures was significant.Last year, Maersk posted profits of 17.5 billion kroner.………………………………………………………………………EstoniaEstonia, which aims to become the third east European euro region member after Slovenia andSlovakia, has fulfilled all entry conditions, Finance Minister Jurgen Ligi and Prime Minister Andrus www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.Ansip said last month. The European Commission and the European Central Bank will report on itseligibility in May and EU nations will make a decision on accession in June. European Union authoritieswill check Estonia’s compliance with entry conditions “with more vigor than ever” after Greek budgetproblems raised concern about further euro region expansion, said Christian Keller, an economist atBarclays Capital in London, in a note last month. Spreads between Estonian and euro region moneymarket rates have fallen to the lowest in 17 months on growing investor confidence. Estonia will adoptthe common currency next year, reports Bloomberg.FinlandThe Finnish economy experienced a decline last year that is deeper than any that has taken place in asingle 12-month period since the Civil War which followed the country’s independence. According tofigures put out by Statistics Finland, total production in Finland declined by 7.8 per cent last year. Onlyin 1917-1918 did total output decline by more. Unemployment is growing in Finland and leadingeconomists expect it to continue to increase through the autumn, after which it should start to ease.Statistics Finland and the Ministry of Employment and the Economy released January’s employmentfigures on Tuesday. According to Statistics Finland, 9.5 per cent of the labour force in Finland was outof work in January, which is 2.6 points more than a year earlier, and 1.6 points more than inDecember. Statistics Finland put the number of jobless in January at 250,000. However, the decline inemployment has still been less steep than during the recession of the 1990s,I and its effects on thelives of most Finns have not been as serious. The state has borrowed money, with which it has paid offsocial benefits and made investments with a stimulating effect on the economy. Interest rates are nowlower than during the previous recession. People have been able both to pay off home loans and toconsume.FranceFrench President promised Greece on 7 March that eurozone countries would help it overcome itsfinancial problems, and vowed a European crackdown on the financial speculations Athens blames forits woes. Speaking after talks with Greek Prime Minister George Papandreou, Sarkozy ruled outimmediate financial backing, but stressed that his economy minister was considering aid possibilities.On a related topic, minister Lagarde said that she personally believed that derivatives on sovereigndebt, such as credit default swaps (CDS), had to be either tightly regulated, limited or even banned.Lagarde said she had no doubt Greece would be able to refinance its debt with the help of publicand/or private funds. After Papandreou had told Europeans he may have to turn to the IMF if EUassistance is not forthcoming, Sarkozy reiterated his opposition towards such a solution. The IMF isheaded by his political rival Dominique Strauss-Kahn. Furthermore, France has issued 22.4 percent ofits medium and long term debt insurance program for 2010, putting it slightly ahead of the sameperiod in 2009. The debt agency’s head said France was having no problems issuing debt despite thecontext in financial markets. However, investors are arguing that French debt is pricey and does notreflect France’s growing indebtedness. While not under any immediate Greece-like default stress, theysay the cost of French bonds and the cost of insuring them does not properly reflect the reality on theground (the French deficit is set to climb to 8.2 percent of GDP this year, the highest for at least half a www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.century). Better news comes from the banking sector, with the French Banking Federationannouncing it will make 96 billion Euros available for very small business and for small to mid-sizedenterprises.GermanyOn 8 March, Angela Merkel backed the idea of a European Monetary Fund and left open thepossibility of helping Greece in the future, while emphasising it was not an emergency now. GermanFinance Minister Wolfgang Schaeuble threw his support behind the idea of an IMF-style rescue fundfor Europe earlier, while Merkel said that the details would have to be sorted out by the EU even if thismeant changing the EU treaty. Merkel reiterated that the EU also had to act with regard to the use ofcredit default swaps to bet against countries such as Greece, but also said that Europe must consultthe US on the issue, as speculation is global and not just limited to European borders or the eurozone.Financial watchdog BaFin has moved to identify speculators and to prevent them from profiting fromany bailout deal. It is believed that the German investigation involved contact with the New-Yorkbased Depository Trust and Clearing Corporation, which records CDS transactions. Earlier, GermanEconomy Minister Rainer Bruederle said each member state was responsible for its own affairs andAthens had to implement its austerity plans effectively. Merkel’s cautious approach toward the Greekproblem, as well as even greater hostility from her Free Democrat (FDP) coalition partners, hasstocked tensions with Greece, with some Greek lawmakers demanding Germans pay reparations forthe Nazi occupation. Speaking after talks with the Greek Prime Minister on 5 March, Merkel said thatthe stability of the euro is not in question because of the Greek debt crisis, and that she is confident itwill not be a problem in the future; she also dismissed any possibility of Greece leaving the eurozone.Furthermore, big German lenders including Deutsche Postbank, Eurohypo and Hypo Real Estate saidthey would not take on more Greek debt, thus making it harder for Greece to sell bonds to resolve itsdeficit crisis. Some experts are even pointing out that Germany might be gaining from the currentGreek problem, giving Berlin more leverage to press for public finance discipline across the eurozone;also, they argue a weaker euro makes German goods more competitive in markets beyond theeurozone and recent surveys have shown improved prospects for the country’s exporters, whosefortunes are crucial to the health of the German economy.GreeceOn 3 March, Greece unveiled a draconian austerity programme targeted at civil servants, the rich andthe church, in a move designed to secure European help in tackling its crippling debt burden. Extrameasures include higher taxes on tobacco, alcohol and fuel and an increase of two percentage pointsin Greeces rate of value-added tax. Public employees will have their pay cut by 30 per cent as bonusesfor Easter, Christmas and summer are cancelled. The government’s plan aims to save an additional 4.8billion euros, around 2 per cent of gross domestic product. Prime Minister George Papandreou notedthat the deep cuts, which drew cries of protest from trade unions, were essential to save the country,and that Greeces austerity measures may pave the way for European Union government aid -something which would ease fears that Greece could lose its ability to borrow from debt markets ataffordable rates. European Commission President José Manuel Barroso welcomed the extra measures, www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.which the Commission and member states had been asking for. Greece needs to borrow 20 billioneuros from the money markets between now and May to replace existing bonds that are maturing.But German Chancellor Angela Merkel, whose backing for any European safety net for Greekborrowing would be vital, stopped short of any commitment to financial support. French PresidentNicolas Sarkozy promised on 7 March that Eurozone countries would help Greece if its financialproblems worsened. Meanwhile, German Finance Minister Wolfgang Schaeuble said he soon plans tomake proposals on a new European institution to help ensure the stability of the Eurozone. TheEuropean Commission has confirmed it is working with Germany, France and other Europeancountries on plans for an EU rescue fund that could, in future, be tapped to help troubled countries.Prime Minister George Papandreou said Greece supports the creation of a European rescue fund tohelp the country, adding that he would turn to the International Monetary Fund only if the countrycould not borrow from markets. Meanwhile, the International Monetary Fund (IMF) welcomedGreeces "very strong" fiscal package to contain its massive debt crisis, saying implementing theausterity measures would be critical. The IMF also called on the Greek authorities to quickly developand implement significant reforms to boost productivity and growth.HungaryHungary’s positive economic-sentiment advanced in February to the highest level in 17 months,reinforcing the government’s latest predictions of a better economic performance this year. Thedecline in Hungary’s inflation will continue, albeit at a slower pace than previously envisaged, thecentral bank (NBH) has said in its quarterly report on inflation. Subdued domestic demand continuesto have a strong downward effect on prices, which may lead to an inflation rate that undershoots themedium-term target (3.0 per cent) in 2011. In 2010 and 2011, the general government deficit as apercentage of GDP can only be reduced to below 4 per cent if the government’s stability reserves andinterest reserves for contingencies are cancelled. However, further measures will be required to meetthe fiscal target. It is important to note, however, that trend developments in the fiscal balance,adjusted for the effects of the economic cycle, remain downwards in the baseline projection.Therecovery in Hungary is likely to lag behind that of the global economy, largely reflecting the decline indomestic demand.IrelandPublic sector unions in Ireland announced that they plan to strike again, and several Dublin hospitalsannounced they will close for two days next month, stepping up a campaign against the government’sfiscal reforms which include cuts to public sector wages. The government had stated that there was nopossibility of reversing these reductions. It also announced that it plans to raise the retirement age forstate pensions in an effort to tackle the heavy public debt. The long-term plan is to raise theretirement age from the current age of 65 to 68 by 2028. Social and Family Affairs Minister MaryHanafin said that the current system fails to take people’s longer lifespan into account. Elsewhere,Ireland’s largest financial institution, Allied Irish Banks PLC (AIB), reported its first ever full-year loss,with a net loss of 2.4 billion euros. This is in sharp contrast to its 772 million euro profit for theprevious year. Outlook for the future is uncertain for AIB, after it has been forced to write off 5.4 www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.billion euros in bad loans, mainly in its Republic of Ireland market. This comes after the recent EUapproval of Ireland’s “bad bank” plan, which has created a state-owned National Asset ManagementAgency (NAMA) to secure the future of Irish banks by absorbing a nominal 77 billion euros worth ofrisky loans. Joaquin Almunia, EU Competition Commissioner, has said the move will help Irish marketsreturn to normal. Five banks are to avail of NAMA’s services, including AIB, which is set to transfer23.2 billion euros worth of debt. In other news, Ireland’s Central Statistics Office reported a slight easein the unemployment rate last month, from 12.7 per cent to 12.6 per cent. Prime Minister Brian Cowensaid that such figures confirm that the situation in Ireland is stabilising. This comes amidst reports thatthe Irish construction sector deteriorated at the slowest pace in over two years in February.ItalyItaly’s Economy Minister Giulio Tremonti said that the Greek crisis requires a political rather than aneconomic response on the part of other European states. The minister, whose tight spendingmeasures are widely credited with helping Italy to avoid the same pressure that Athens is currentlyfacing, stated that a possible solution to the crisis could include a role for the International MonetaryFund (IMF). He stressed that Europe’s wealthier states cannot afford to turn their backs on the Greece,as failure to help tackle the problems there will have knock-on effects for all. The Italian economycontracted 5 per cent last year, with analysts predicting a 1.1 per cent growth in 2010. In other news,Finmeccanica, Italy’s top defence and aerospace company specialising in the manufacture ofhelicopters and electronic warfare systems and the assembly of civil and military jets, has said that itremains optimistic about its prospects for this year and next, despite the general slow-down in thespace sector. It says it plans to continue to cut costs and focus on emerging markets, and that itexpects profits to rise to more than 22 billion euros over the course of the next two years. Italcementi,the worlds No. 5 cement group in terms of production capacity, has approved its first bond plan, andhas made an offer to buy out the U.S. note holders that previously prevented it from taking over theFrench company Ciments Francais.LatviaA second Supplemental Memorandum of Understanding (SMoU) in the context of the Balance ofPayment (BoP) assistance to Latvia was signed by the Commissioner Olli Rehn and the Latvianauthorities on 22 February 2010. The new SMoU complements the previous Memoranda ofUnderstanding signed in February and July 2009, it paved the way for the third disurbsement of 500million euros on 11 March. It was the third out of six instalments of a 3.1 euros billion Community loanto Latvia, which was agreed in January 2009 as part of a 7.5 billion euros multilateral financialassistance package.The SMoU includes continuous requirements, e.g. on the required fiscaladjustment for 2011-2012 in line with what specified in the Council recommendation under theexcessive deficit procedure in July 2009, and specific economic conditions as regards fiscalconsolidation, fiscal governance reform, financial sector and structural reforms. The latter includesteps to improve the business environment, EU Structural Funds fund absorption, access to financingfor SMEs and public sector reforms. With the aim of making the SMoU more operational, specificdeadlines have been attached to meeting its conditions. www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.LithuaniaThe government of Prime Minister Andrius Kubilius cut budget spending and increased taxes to saveabout 9 per cent of gross domestic product last year. The Cabinet plans a further fiscal consolidationof 5 per cent of GDP in this year’s budget. Lithuania’s economy shrank 12.8 per cent in the fourthquarter, undercutting efforts to contain the deficit. Fitch estimates the economy may grow 1 per centthis year. The EU said on 27 January that measures to stem the shortfall were “adequate” and gaveLithuania until 2012 to narrow the budget gap to the within 3 percent of GDP. Lithuania, whichmaintains a fixed-exchange rate for the litai to the euro, is using deflation and wage cuts to restorecompetitiveness after a boom following accession into the EU in 2004. Lithuania raised its economicforecast this year on 1 February, predicting a 1.6 per cent expansion, compared with a previousforecast of a 4.3 per cent contraction.LuxembourgIn an interview with the Handelsblatt business daily, Luxembourg’s Finance Minister Luc Friedenstressed that eurozone members will not allow Greece to become a risk for the euro and have nochoice but to help the country through its debt crisis. Calling Europe “a mutually supportive group”,Frieden called market speculation against individual countries harmful, adding that no country in theeurozone would go bankrupt. Frieden also said there was no reason why a German should not lead theEuropean Central Bank, striking a different tone to Luxembourg Prime Minister Jean-Claude Juncker.Juncker has dismissed arguments that the appointment of Portugal’s Vitor Constancio as ECB vice-president cleared the way for Germany’s Axel Weber to take the top job.NetherlandsAfter the ruling coalition fell apart over the question of whether to extend the Netherlands’s militarymission in Afghanistan, Queen Beatrix has ordered an early general election on 9 June, and decidedthat a caretaker government will remain in power until the election. Caretaker Prime Minister JanPeter Balkenende announced he would discuss with parliament which issues to declare controversial,with the caretaker government not being able to act on those issues during its tenure. Among thetopics that might be ruled out of bounds are stimulus measures for the construction sector, a rise inthe retirement age and austerity measures to cut the deficit. These budgetary challenges and otherswill fall to the newly appointed Finance Minister Jan Kees de Jager, a Christian Democrat who led thegovernment’s crackdown on international tax evaders as the deputy finance minister. He now facesthe prospect of trying to prepare an austerity budget, continuing the pursuit of tax evaders andnegotiating a debt deal with Iceland, all with a limited mandate. Regarding the Iceland issue, theDutch Minister said he was disappointed there was no agreement yet, but that he remainedcommitted to finding a solution. The Dutch appeared to harden their position by linking the Icesavedispute to Iceland’s hopes of joining the EU. Meanwhile, Dutch state-owned Fortis Bank Nederlandreported a sharply lower income and profit on impairments for 2009 and said its merger withnationalised peer ABN AMRO should be done by 2012, with the combined group, which will operate asABN AMRO Bank, expected to be privatised in 2013 at the earliest. Dutch life insurer Aegon NV beatforuth-quarter profit estimates thanks to investment gains and higher fees, but said it will continue to www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.keep a substantial capital buffer due to the uncertain environment, and thus will not pay a 2009dividend as analysts expected. Aegon gave no update on its talks with the European Commissionabout the 3 billion euros in state aid it received in late 2008.PolandThe Polish economy performed even better than predicted in the last three months of last year, andthis pattern is set to continue in 2010 as falling inflation rates are relieving the pressure on the centralbank to raise interest rates. The economy – the only one of the 27 member states to have successfullyavoided recession in 2009 – grew by 3.1 per cent year-on-year in the third quarter of last year.Investments rose year-on-year, as did domestic demand and private consumption. The zloty iscurrently trading at the highest level in 14 months at about 3.93 to the euro. The EuropeanCommission has forecast it will be the fastest growing economy in 2010, and GDP is set to grow at 3.1per cent. Some analysts expect interest rates to be hiked up later in the year, but with inflationcontinuing to decrease, this may not prove necessary. Economy Minister Waldemar Pawlak alsowarned that rate hikes could have a damaging effect on Polish exports. Michal Boni, a top governmentaid, has pointed to the possibility that Poland’s budget deficit could be 10-15 billion zlotys less thanthe target of 52.2 billion in 2010. However, according to Polish labour ministry forecasts, the country’sunemployment rate most likely rose to 13 per cent in February, up from 12.7 per cent in January.PortugalPortugal became the latest eurozone country to announce austerity measures to rein in a ballooningbudgetary deficit, as debt-stricken Greece urged global action to curb speculation in credit defaultswaps. The country announced plans to cut its deficit to 2.8 per cent of GDP in 2013 from 8.3 per centthis year by trimming spending on civil servants and public investment, as well as raising taxes on highincomes and stock market gains. The program is seen as the key to convincing markets that Portugalwill tackle its high deficit and debt after coming under scrutiny by investors fearing it may be next inline to have Greek-style fiscal problems. Portugal’s largest union has threatened more strikesfollowing the last civil servants’ walkout if the government extends wage freezes in the public sectorbeyond this year. Portugal’s unions say they have had years of worsening conditions as public pensionsand other benefits were cut by the government, which this year froze public wages in its effort to wininvestor confidence by cutting the budget deficit. Strikes are the latest problem for the government,with Prime Minister Socrates‘ approval rating plunging in February as accusations that hisgovernment stifled the media and the poor state of the economy took their toll. The poll in businessdaily Diario Economico showed a slump in the number of Portuguese who have a positive image ofSocrates to 29.4 per cent in February from 40.3 per cent in January. The survey, carried out byMarktest, was the first to show that Socrates and his minority Socialist government have suffered as aresult of relentless accusations by the opposition that he attempted to manipulate the media.RomaniaRomania’s economy is likely to stagnate in 2010, but will grow by 3 per cent in 2011, according to theVienna-based Institute for International Economic Studies. The Austrian think tank foresees slightly www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.higher growth of four percent in 2012. Officials of Romania’s second largest lender BRD-SocietéGénérale gave more optimist forecasts, pointing to growth at around 1.5 per cent in 2010. BRD saysthat political continuity and continued IMF and EU funding, as well as rising exports and theadjustment of the country’s current account deficit are all factors pointing towards economic growthin 2010. The BRD chief economist also pointed out that although Romania would lag behind other EUmember states for a good part of the year, it will end 2010 with growth double than the EU average,which has been estimated at 0.7 per cent. In 2011, BRD expects the economy to grow by 3 per centyear-on-year. Nevertheless, downward pressure may arise from growing insolvencies, shortages in thelabour market, insufficient EU fund absorption and the underground economy. These forecasts aremirrored by more negative figures referring to 2009 and early 2010: according to revised data fromthe National Statistics Institute, Romania’s GDP declined by 7.1 per cent year-on-year in 2009,amounting to 119.8 billion euros. The largest declines last year were registered in the construction(13.6 per cent), retail and communications (11.2 per cent) sectors. Domestic investment was down to29.1 per cent in 2009 compared to 2008. The Central Bank has also shown that the value of overduepersonal debt was up to 14.7 per cent in January, compared to the month before. Over one millionRomanians had debts in January what is 28,000 more than in the previous month, with the averagedebt amounting to 763 euros.SlovakiaThe Statistics Office said that the development of the Slovak economy in 2010 will especially dependon foreign demand and that a certain recovery already took place in the final quarter of 2009.Nevertheless, the Statistics Office reported on 4 March that Slovakia’s unemployment rate in the finalquarter of 2009 reached 13.9 per cent, which was the highest figure since the first quarter of 2006.The overall unemployment rate for the entire year of 2009 stood at 12.1 per cent. The number ofjobless Slovaks reached 324,200 at the end of the year, which was a 25.9 percent increase year-on-year. Ivan Mikloš, the Vice-Chairman of the biggest oppostition party, SDKÚ, presented a new website,on which the party listed what it calls Smer’s unfulfilled pre-election pledges. Among the most seriouscharges, Mikloš highlighted the Prime Minister’s claim that unemployment in Slovakia has grown inline with the EU average. Based on available data, unemployment in Slovakia has increased at a ratethat is 115 per cent higher than the EU average. The Slovak Statistics Office also stated that economicactivity contracted by 4.7 percent last year and gross domestic product in constant prices ticked down2.6 percent year-on-year in the last quarter. Both domestic and foreign demand shrank in the lastquarter of 2009, affecting economic development. Exports of goods and services decreased by 5.2percent, and imports dropped by 10.3 percent in the fourth quarter. The state budget recorded adeficit of 780 million euros in February, after recording a surplus of 23 million euros in January, theFinance Ministry announced on 1 March.SloveniaIn light of the gradual recovery of the global economy, the International Monetary Fund (IMF)revised upwards its forecast of global GDP growth for this year, while simultaneously emphasisingcontinued significant downside risks. The value of merchandise exports and production in www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.manufacturing increased again in November, as it had in previous months, while other indicators showthat the risks to recovery persist. Employment dropped further in November. December and Januarysaw lower growth in the number of registered unemployed than previous months. The growth of theaverage gross wage increased due to extraordinary payments in November and the governmentpassed a new Minimum Wage Act, which will most likely induce a restructuring of the economy and,consequently, increase the numbers unemployed. In 2009, Slovenia’s inflation was among the highestin the euro area. In January, year-on-year inflation totalled 1.5 per cent. The situation in Slovenia’sfinancial markets tightened further in the last quarter of 2009. This quarter also saw the most notableslowdown in lending activity of the year. In 2009, revenue from taxes and social security contributionsdeclined by 7.1 per cent relative to the year before, and the consolidated balance of public financingrecorded a deficit of EUR 1,484 m according to the available data for the first ten months. Slovenia’snet budgetary position in the EU was, on the other hand, positive again in 2009, and the utilisation ofEU funds the highest since 2006: 73 per cent of what was planned. The greatest improvement wasrecorded for the utilisation of cohesion and structural funds.SpainSpain tested investor appetite for its debt, placing 4.5 billion euros of five-year Treasury bonds with acoupon of 3 per cent. The bid cover, at about 1.5 times, was slightly down on the last comparableissue, on 14 January, but this was ascribed as much to the size of the issue as to market jitters aboutthe Spanish economy. More pleasing for finance ministry officials, however, was that spreads overGerman bonds appeared to have narrowed by several basis points since the Greek economic crisisraised doubts about other so-called “peripheral” European economies. Spain is likely to become thefocus of investor concerns once Athens resolves its budget crisis; therefore, the Spanish governmenthas been at pains to convince investors of its commitment to an austerity plan which aims to reduce abudget deficit of 11.4 per cent to 3 per cent by the end of 2013. The Prime Minister thus faces anuncomfortable spring, as very few analysts and investors are convinced either that the plans areplausible or that the government has the will or ability to implement them. Critics of the austerity planpoint to three main obstacles: first, the economic forecasts are considered too optimistic. Second,central government has direct control over only about a quarter of expenditure, with the restdisbursed by autonomous regional governments and the social security system and, finally, Socialistslack the necessary will. The opposition Popular Party has also dismissed as “simplistic” and lacking inconcrete proposals a government document presented to a meeting of political parties to jointlytackle the crisis. In an attempt to restore confidence within Spain and boost consumer spending,Spanish business leaders launched a campaign, which will include 4 million euros of advertising, withthe slogan “We can only fix this if we are all together.” Meanwhile, the governor of the Bank of Spainis campaigning for labour reform and budget restraint. But the government’s plan to raise theretirement age by two years to 67 brought the unions onto the streets at the end of February,marking the first open clash for six years between organised labour and a Socialist government seekingto appease markets with austerity. www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.SwedenThe credit outlook for the Swedish banking sector remains negative, although it is improving. Swedishbanks still face a challenging operating environment which will continue to put pressure on theirfinancial fundamentals in 2010, Moodys Investors Service said. The report added that Swedish banksremain exposed to key risks, notably asset quality deterioration, particularly from the severelydamaged Baltic economies and constrained revenue generation resulting from credit risk and fundingcosts. However, Swedish banks are in a better position than they were a year ago thanks to a brighterdomestic economic outlook, some signs of stabilisation in the Baltic economies, and the easing ofconditions in the wholesale funding markets. Most of the large Swedish banks took measures tostrengthen their capital in order to absorb future asset quality deterioration, particularly from theBaltic countries, to which the Swedish banking system is partly exposed. However, Moodys notes that,unlike in other banking systems, this capital has been raised directly from the capital markets withoutthe need for government injections.UnitedvKingdomThe sterling has continued its recovery from its 10-month low against the dollar at the beginning ofMarch, although analysts have been quick to stress that this is due to the dollar’s weakness ratherthan to any strengthening of the sterling. Big challenges remain for the UK economy, especially if theBank of England is to restart asset purchases, a move which would have a negative consequence onthe sterling according to some analysts. The growing possibility that the next elections may result in ahung parliament (where no political party has an overall majority) is also negatively affecting thesterling, as such a parliament is perceived to be less effective in dealing with fiscal deficit. The BritishChamber of Commerce has also lowered its economic growth expectations for the UK for 2011, andwarned against the country growing complacent in the knowledge that it has come out of recession. Itstated that obstacles to growth now appear greater than first believed. The BBC has echoed this,arguing that the Treasury’s forecasts on public sector deficits for 2011 are too optimistic. Deficits areinstead set to increase to “dangerous levels” of more than 80 per cent of GDP it said, despite ChancellorDarling’s promise to halve them over the next four years. The recent surveys of two industry bodieshave nevertheless pointed to growing optimism amongst employers for the country’s recoveryprospects. The surveys reported a general stabilisation in the service sector in the last three months.Recent GDP figure also show that the UK economy grew by 3 per cent in the last three months of 2009.WORLDWIDEAfricaIMF Managing Director Dominique Strauss-Kahn has said that Africa should now concentrate on long-term challenges like governance and climate change in order to further the region’s economictransformation. While the global economic crisis has hit Africa harshly, signs of recovery and hope arealready visible he said, and strong growth and greater resistance to shocks should now be key www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.priorities of the region. He praised some of the region’s pre-crisis budget initiatives, which he saysmanaged to inoculate it to a certain extent from the crisis. However, he stressed that there is no roomfor complacency, as measures for the future must now be implemented. The IMF has predicted 4.5per cent growth for Africa in 2010.CanadaCanadian Finance Minister Jim Flaherty has reported that business confidence in the country iscurrently higher than in the U.S., and that the Canadian economy is much healthier than many otherdeveloped nations at the moment. The strength of the Canadian dollar in comparison to the U.S. dollarwill help it to import manufacturing materials at cheaper prices, even if exports may be adverselyaffected by this. The government has also moved to eliminate all tariffs on materials used bymanufacturers, in a bid to offset the damage done to them during the downturn. It is also looking intothe possibility of selling federally owned assets to close a record budget deficit forecast at about C$56billion ($54 billion) in 2009-10.ChinaDominique Strauss-Kahn, head of the IMF, has said that China’s Yuan remains “very muchundervalued’. However, he added that a concentration on domestic growth could change this in thecoming months, as the crisis has led the Chinese economy to move to more traditional models ofgrowth. He stressed that the world economy has now entered an unprecedented phase, and thatincreased savings rates by American households had brought about a “huge” changes capable ofshifting the balance between Asia and the U.S. However, he said that the Chinese market and otherswere still far from overtaking the U.S. as the growth engine of the world.LatincAmericaA global survey by Manpower Inc has found that employer confidence in Latin America is highest inCosta Rica, Peru and Brazil. In these countries the finance, construction and real estate sectors arecurrently strong. In Brazil, stocks jumped and the currency rose following better than expected jobfigures from the U.S. and indications that the Greek crisis will be contained. The Brazilian economy hasbecome more and more dependent on developments in the U.S. and global markets, as equitymarkets elsewhere are seen as good indicators of confidence. The Brazilian Real also strengthened 0.7per cent to 1.78 per dollar, with the Economy minister Guido Mantega stating that this was theinevitable result of an economy as solid and fast-growing as Brazil’s.UnitedcStatesA survey of 18,000 hiring managers in the U.S. conducted by Manpower Inc has found that employersare likely to be less willing to hire in the coming quarter than three months ago, despite the fact thathiring increases are likely in most other countries. There are currently some 17 million Americansunemployed, and Manpower has set the country’s seasonally adjusted net employment outlook forthe second quarter at plus-5, slightly down from the previous survey’s plus-6. 73% of employersreported no change in their hiring outlook, indicating that people are unlikely to be let go, but that www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.hiring will not recommence until demand begins to grow. These conclusions are reinforced by a surveyof the National Federation of Independent Business recently released, which reports a fall inoptimism in small businesses in the country. The optimism index for this sector dropped 1.3 points to88.0 in February from January. It also reports that the major factor influencing business outlook is notaccess to or availability of credit, but weak sale forecasts, which are discouraging small businessesfrom investing and creating jobs. The situation is not likely to be helped by the fact that consumerconfidence fell in March to its lowest level in a year, and is unlikely to increase until theunemployment level comes down from its current 9.7 per cent. In other news, President Obama hasmet with Greek Prime Minister Papandreou to discuss the Greek economic crisis. Papandreoureported after the meeting at the White House that the American president had expressed supportand encouragement for the measures undertaken by the country. Prior to the meeting the WhiteHouse has issued a statement urging Greece to do all in its power to bring debt under control andstimulate growthINSTITUTIONSEUROGROUP and ECOFIN meetings: European Union finance ministers will agree next week tophase out aid measures for banks, industries and the labour market that were introduced to fight theeconomic crisis. The 27 EU finance ministers meet on March 16 to discuss Greeces financial problemsand exit strategies from fiscal stimulus measures worth hundreds of billions of euros that were agreedon in late 2008 to battle the crisis. Economic analysts and politicians say EU governments need tostrike a fine balance -- keeping the aid measures in place long enough to avoid killing nascenteconomic revival, but ending them sufficiently early to keep budget deficits under control. Theministers draft statement said support measures for various industrial sectors such as the car industryshould be the first to be extinguished as economic recovery gains pace. Support for some long-termobjectives, such as green technologies and research and innovation, will be permitted if they arecompatible with the EUs state aid rules.European Parliament: On 10 March, a majority of MEPs pushed the EU executive to weigh up thecosts and benefits of a possible tax on financial trading to compensate taxpayers for bank bailouts andplug public deficits. 536 MEPs yesterday asked the European Commission to finish its report oninnovative financing before the June G20 talks, so world leaders can come up with specific proposalson which banks will be taxed and how. Just 80 MEPs voted against the EU executives examination of abank tax – so far dubbed a financial transactions tax (FTT) in the legislature – with 33 abstentions.World leaders will meet in Toronto in June this year and are expected to come to an agreement onhow a global tax should be structured. Though the European Parliaments vote shows heightenedinterest in Brussels for a tax on banks, the EU institutions warn that much work remains to be done atboth EU and global level on the shape and timing of such a tax. The European Commission also saidthat its paper on innovative financing was currently being written and that it was too early to talk oflegislation on a bank tax. The Commission paper, like a parallel paper being drafted by the www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.International Monetary Fund, is not only examining an FTT but also a levy on assets, as is the case withUS President Barack Obamas proposal.European Commission: The Commission President, José Manuel Barroso, has unveiled a long-awaited ’Europe 2020’ strategy for greener growth and jobs in Europe, proposing a limited set oftargets on education, R&D and poverty reduction, and "policy warnings" for EU countries that fail tomeet them. If implemented, the strategy should bring "at least 2 per cent growth" to Europe, Barrososaid, adding however that it would be "too risky" to speculate on a precise figure as the currenteconomic crisis had made the situation difficult to predict. Meanwhile, the Commission published itslatest interim economic forecasts on 25 February 2010. The underlying message of this update of GDPand inflation variables is that the EU economy is recovering, but still facing headwinds. The updatedprojections are based on figures from France, Germany, Italy, the Netherlands, Poland, Spain and theUnited Kingdom, accounting for 80 per cent of EU GDP. The Commission has revised slightly upwardthe growth projections for the first half of 2010. This update is based on a global recovery in thesecond part of 2009 that proved stronger than expected. This is due especially to an uptake in Asia.World GDP excluding the EU did not shrink in 2009 and is expected to grow by some 4.25 per cent in2010. However, what impact the world uptake will have on EU growth remains to be seen. The EU isbenefitting from improved sentiment indicators, but industrial production and retail sales figuresamongst others have been less promising, and investments remain weak. Similarly, financial marketsrecovered in 2009 but uncertainties remain. With a weak labour market outlook likely to dampendemand, and many of the growth sources being of temporary nature, the robustness of the EUrecovery is yet to be tested. In 2010 price stability is expected to be maintained, with inflationprojections being only marginally revised upwards to 1.4 per cent in the EU, and staying unchanged at1.1 per cent in the euro area.European Central Bank (ECB): Analysts argue that the European Central Bank has held back inextending its credit lines to new member states struggling to regain liquidity in their public accounts,making it harder to restore investor confidence in those markets. The European Central Bank (ECB)could have done more to provide liquidity to new member states in Eastern Europe, such as extendingits currency swap lines to the countries central banks, argues Zsolt Darvas, from the Brussels-basedBruegel think-tank. Analysts at the event said that secrecy over currency swaps with non-eurocountries has prompted fears that the ECB is more willing to help old Europe than new Europe.EPP ViewsEPP Group Vice-Chairman Othmar Karas, EPP Group Coordinator in the Special Committee on theFinancial Crisis, warned that late payment, especially by the public sector, is causing massive problemsof liquidity for small and medium-sized enterprises all over Europe, adding to the consequences ofthe financial and economic crisis. The Chairman of Parliaments SME Intergroup and EPP GroupCoordinator in the CRIS Committee was therefore calling for more European efforts in supporting www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.SMEs. Opening a conference of insurance brokers and intermediaries in the European Parliament,Gunnar Hökmark MEP, Vice-Chairman of the EPP Group, said that only systemic risk, not businessrisks, should be regulated. His opinion was that legislation does not have to hinder new jobs and thecompetitiveness of European industry. On behalf of the EPP Group, Corien Wortmann-Kool MEP, Vice-Chairwoman of the EPP Group responsible for the Working Group Economy and Environment calledfor an urgent debate with the Council and the Commission on the current alarming financial situationin some eurozone countries. According to Wortmann-Kool, the solution does not lie in the extramoney from the EU budget, but in the actual implementation of reform plans, such as the Greekgovernment has presented. This will strongly influence the other Member States - Spain, Portugal andIreland - who are in the same situation.OUR COMPETITORS’ VIEWSS&DThe S&D Group gave a firm warning against excessive cutbacks and austerity measures in dealingwith the economic crisis that has provoked a rising tide of industrial and social unrest across Europe.Group vice-President Stephen Hughes of the UK called on the EU to create five million jobs in the newgreen economy by 2015, while Marita Ulvskog of Sweden, also S&D vice-president, called for asustainable society and for the new EU growth strategy to be “a new green deal.” The S&D politicianscalled on EU leaders to adopt an ambitious plan to strengthen the governance of the Eurozone, whilecoming up with a strengthened role for the European Investment Bank.ALDEGuy Verhofstadt has called for the European Parliament to investigate the Greek debt crisis, saying that it isimportant for the credibility of the eurozone to fully understand the origins of the crisis and learn thelessons for the future management of the Stability and Growth Pact. He declared that part of theproblem lies also in the fact that the EMU project remains incomplete in that the monetary union wasachieved without a genuine economic union; in his opinion, the two are two sides of the same coin,and one will always be weak without the other. Furthermore, following a proposal by the ALDEPresident, the EP’s Conference of Presidents decided to promptly convene a public hearing of allthose implicated in the falsification of Greek public accounts. The hearing will be organised under theaegis of the Committee of Economic and Monetary Affairs, chaired by ALDE member Sharon Bowles.Representatives of the Commission, Eurogroup, the ECB, Eurostat, the Greek government, GoldmanSachs and all other financial establishments concerned will be invited to attend.GUE/NGLPresident Lothar Bisky said the bank and industry rescue plans had meant increased state debt andpublic service cuts. In his opinion, after the state allocated rescue packages for the banks, it is preciselythese banks who are now speculating against state finances and with honest taxpayers’ money. GreekMEP Nikolaos Chountis said that workers in Greece were taking to the streets in anger and frustrationat the harsh measures taken by the Greek government following EU pressure. Instead of this, he www.thinkingeurope.eu
    • Centre For European Studies ECONOMIC RECOVERY WATCHLast updated on 11/03/2010 To view full articles click on hyperlinks.suggested, the European Council should take measures to support the weaker economies, as well astaking steps to put an end to speculationFROM THE BLOGOSPHERE…Saved by the Greeks? : Edin Mujagic comments on the future prospects of the Euro and reasons notto despair.German ambiguities underlie confusion over EU monetary fund: Tony Barber analyses Germany’sattitude towards the creation of a European Monetary Fund.Greece is the word in Japan: Gideon Rachman considers the impact the Greek crisis is having onJapan, and describes the country’s growing malaise.UPCOMING EVENTSEvent: Eurogroup and ECOFIN meetingsDate: 15-16 March 2010, BrusselsEditor: Roland FreudensteinffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffResearch Assistance: Katarína KrálikováccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccAdditional Assistance: Diana Wasilewska, Ioana Lung, Patricia Murrayvvvvvvvvvvvvvvvvvvvvvvv ,,,,,,,,,,,Design: José Luis FontalbacccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccccQuestions and comments: briefs@thinkingeurope.eu www.thinkingeurope.eu