Turkey vs EU

In both the French and Dutch No camps some voices were raised against Turkey entering the EU. Via Dutch weblog Sargasso I found a very interesting entry at Turkish weblog Turkish Torque. One excerpt:

It seems like AKP, like many Turks, has been discouraged by the French and Dutch referenda. This will only strengthen the hand of all the parties that have accused AKP with “selling out” national interests to the EU membership dream. (…) Letting go of the EU project would be a radical shift in foreign policy with serious repercussions on many foreign and domestic issues ranging from Cyprus to the re-trial of Ocalan.

It seems that the consequences of the demise of the Constitutional Treaty may reach further than ‘just’ an institutional crisis within the EU itself. Sadly, I do not have the time, nor the knowledge, to go into this but I believe it would be worthwile to follow this one a bit more closely.

Britain’s Referendum Postponed ‘Indefinitely’

Well, now it’s official:

Britain, which takes over the presidency of the European Union next month, has postponed indefinitely a troubled referendum on the bloc’s constitution following its rejection in France and the Netherlands, Prime Minister Tony Blair’s office said Monday. Blair’s official spokesman said the failure of the French and Dutch referendums on the charter had to be discussed at the European Council summit later this month. The referendum faced likely defeat in Britain.

Denmark Poll: ‘No’ Takes Lead

The EU observer is carrying details of a poll conducted in Denmark by Greens Analyseinstitut, and published in the Danish business daily B?rsen today (3 June), 39.5 per cent of Danes would reject the Constitution, 30.8 per cent would now approve the Constitution, while 29.7 per cent were undecided.

Calculating roughly, this means of those who have decided, 56% are against and 44% are in favour. Interestingly 63% want the right to vote. Prime Minister Anders Fogh Rasmussen – the EU Observer says – is reluctant to officially cancel the planned referendum scheduled for 27 September. This is an elemnt I hadn’t bargained on – the people demanding the right to express themselves. This could become a bandwagon which it gets difficult to stop. I guess it is what Barroso meant by ‘contagion’.

Latvia Votes Yes

The Latvian parliament approved the Constitution Treaty earlier this morning, by a huge majority:

Latvia’s parliament voted overwhelmingly to support the EU constitution on Thursday, a decision lawmakers and analysts said sent a message from the new Europe to the old that the approval process must continue.

After several European leaders urged other member states to press ahead with the endorsement process after convincing rejections in the French and Dutch referendums, Latvia’s 100 member parliament voted 71 for the constitution with 5 votes against and 6 abstaining“.

The next hurdle will be the Luxembourg referendum, on the 10th July. This will take place as scheduled if the EU summit of 15/16 June doesn’t decide to change tack.

Meanwhile French media are announcing that there is a plan B, it’s called Blair. Tony Blair, they are suggesting, will seize the opportunity presented by disarray in the federal Europe camp to push ahead with ‘liberal’ economic reforms, leaving the institutional infrastructure to languish. Possibly the outcome the French fear most. Something like this may in fact be what happens.

Twenty Twenty Vision

The press this morning are busily assimilating the result of yesterday’s Netherlands referendum. The FT reports on a survey by Dutch polling organisation Interview-NSS, which identified up to twenty different issues which influenced the no vote.

Top of the list the list was a fear that the Netherlands would lose influence in a Europe that would favour large countries.
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And It’s Another No

The first exit polls have just been announced in the Netherlands. The first estimate is 63% No, 37% Yes. (I may have to update this, as I have no numbers on abstention).

Let the debate continue!

Update: The euro just broke under the $1.22 level, it is currently at $1.2179 in US trading. Tomorrow is going to be a long hard day somewhere. (22.14 CET).

Dutch referendum: some background

Having been asked by AFOE to write a couple of posts for them in the coming weeks I am both honoured and horrified and apologize in advance for occasionally butchering the English language. A very short introduction: I am a Dutch translator now living in France after 30 odd years of residence in Belgium. I am totally incapable of producing fine scholarly essays but I can do my part of the vox populi pretty well? I hope.

To warm up I offer you some background relevant to the Dutch referendum before the official results start rolling in. First some figures, taken from a Eurostat news report (pdf) that was released today.

Dutch unemployment, while remaining well below the European average of 8,9%, has risen from 4.6% to 5%. By comparison, Poland has 17% unemployment and Ireland 4.2%. Eurostat also mentions that The Netherlands registered the highest relative increase in unemployment rates among the member states together with Portugal (6.5% to 7.2%) and Luxemburg (4.2% to 4.6%). Unemployment among young people in The Netherlands, while fairly high at 9.2%, is still modest compared to the EU average rate of 19%.
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The Calm Before The Storm

Following the turbulent river of news which has flowed unrelentingly through the principal European media outlets since Sunday night, today we seem to be swimming in a relative ocean of calm. This is very deceptive. Today the Netherlands is voting and tomorrow the ECB will have a closely watched meeting which may potentially have significant consequences for the EU economy.

If at this stage there seems little doubt about the outcome of the Dutch vote (more worthy of interest will be the level of participation and the size of the ‘no’ majority), we are also unlikely to see anything earth shattering happening over at the ECB. It is unlikely that there will be any change in the Central Bank’s two per cent interest rate policy (or twirp, as some wit at Morgan Stanley has christened it, after the rather better known zero rate (or zirp) policy at the Bank of Japan). All the watching eyes inevitably be focussed on the press conference, and on Trichet’s handling of the inevitable questions (worth a look at the 2:30pm webcast).

So if today we are enjoying a ‘day of reflection’, tomorrow we will undoubtedly see battle rejoined. In particular, it will be ‘D’ – or decision – day for Barroso and the EU Commission.
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French Referendum: Italian Bonds Hit

What, you may ask, has Italian government debt got to do with the French ‘no’ vote: everything would be my answer. (If you want to know more about this, thumb down my euro posts). The lack of a convincing advance towards political union makes Italian government debt riskier, so they have to pay more interest. This is, at present just a small breach, but it is one which is widening, and I fear this is the point at which the euro dyke will eventually breach:

The euro hit a fresh 7-month low against the dollar and Italian government bonds came under strain on Monday after French voters gave a decisive thumbs-down to the proposed European Union constitution…………….The strains the French vote could have on the euro zone were reflected in government bonds. The spread on Italian BTP bonds over German debt touched 23 basis points, the highest level since November 2002, as so-called peripheral euro zone bonds suffered.”

The problem is that the markets have now ‘wised up’ to the problem, and will now be tracking Italian government debt as an issue in itself.