European
Foundation Intelligence Digest
Issue
No. 117 / 6th April – 19th Aril 2001
OECD revises
euro-zone growth downwards
As the euro continues to fall on
foreign exchange markets – it has been trading at 88 cents this week, despite
the continuing bad economic news coming out of the United States – the
Organisation for Economic Co-operation and Development has revised downwards
its prediction for growth in the euro zone to 2.7% for the current year, 2001. Although the OECD finds that job creation
has been faster in the euro zone than in either the United States or the United
Kingdom (where rates of unemployment are a fraction of what they are on the
European continent) and although it expects euro-unemployment to come down top
8.4% in 2001 and 7.9% in 2002, the single overall economic growth continues to
be weak. The OECD blames differences in
growth rates between euro countries and “dissonances” in official
pronouncements for the continuing fall in the value of the European single
currency, which has lost even more value than it did in 2000. The rising oil price is also blamed for the
euro’s weakness. The new predicted growth rate of 2.7% for 2001 contrasts
unfavourably with the rate of 3.4% achieved in 2000. Inflation is expected to reach 2.2%. Despite this, the OECD economists insist that the euro zone is
now more able to resist external shocks than it was before monetary union. The OECD continues to call for “structural
reforms” in the euro-zone states, especially in the labour markets. “A revision in the legislation protecting
workers” is required, says the report, to encourage growth and employment. The OECD also says that preparation for the
change-over to the euro is lagging behind and that small businesses,
especially, should advertise their prices in both currencies. [Babette Stern, Le Monde, 10th April 2001]
Germany revises growth forecast downwards
Pasqua
and Villiers both against the euro
Charles Pasqua and Philippe de Villiers, the two anti-euro
politicians who ran together in the European Parliament elections in 1999 but
whose alliance has since collapsed, have both independently reaffirmed their
opposition to the European single currency.
Charles Pasqua, moreover, has announced that he will run for the
presidency in 2002. Philippe de
Villiers, meanwhile, says that he will decide whether to run for president in
the autumn or by the end of the year.
Pasqua insisted that he would run for the Elysée on a sovereignty ticket
and that he would “defend the values of liberty and authority which the Right
no longer dares to defend”. Mr. Pasqua
also attacked the euro as “the symbolic murder of Marianne (the symbol of the
French republic).” Both men also
campaigned on issues of public security, saying that they support policies of
zero tolerance for street crime. [Le Figaro,
7th April 2001]
II. Other EU news
EU
plans no sanctions against Italy
With 30 days to go before the general
elections in Italy, the leader of the Italian right, Silvio Berlusconi, has
reaffirmed that he expects to win and that the coalition he will lead will
prove stable. He has also categorically
alleged that he lost in 1996 only because of electoral fraud. “In 1996, 1,170,000 ballots were destroyed. In Italy, the left has a long tradition of
electoral fraud. Today, all demoscopic
institutes agree that in reality we won, with a lead of between 10% -
15%.” He also said that a political
campaign had been waged against him by a politically motivated judiciary while
he was prime minister and concludes that Italy is “not a democratic
country”. “None of the governments
which have succeeded that of Romano Prodi have been legitimised by the people,”
he said. Mr. Berlusconi also repeated
an attack he made on the American adviser of his chief opponent, Francesco
Rutelli. Rutelli’s campaign is being
managed by Stan Greenberg, whom Berlusconi has accused of spreading false
information, such as by claiming that there is an increase in support for the
left and by demonising Berlusconi.
Berlusconi illustrated Greenberg’s accusatory tactics by telling a story
about Lyndon Johnson. “President
Johnson once caused a rumour to be spread, by means of his press spokesman,
that his opponent had sex with chickens.
The spokesman retorted that this was simply not credible. President Johnson replied, ‘That does not
matter. What matters is that he will
have to defend himself against these accusations on television.’ This is the way that the left operates
here. Thank God, the Italians have seen
through this game. That is why we are
10% - 15% ahead of our opponents.” [Interview in Die Welt, 16th April 2001]
Seven lean years for new EU members
Having waited over a decade before being welcomed into the “European family”, citizens of the states of Central and Eastern Europe who expect to become members of the EU will have to wait seven years before being allowed to work in another EU state. The Commission has suggested a seven-year transitional period as a way of defusing fears in the richer Western states, especially Germany and Austria, that cheap labour from the East might undercut wages in the West. The Commission has therefore proposed a maximum of seven years with provisions for making the transition shorter if the other states so decide. The EU is currently negotiating with ten states on membership: these transitional arrangements on employment will not apply to Cyrpus and Malta but to the other eight Eastern European candidate countries. It is expected that the new admissions will occur around 2004 – 14 years after the fall of the Berlin Wall. The plans to impose this transitional period are very unpopular, by all accounts, in Poland and the Czech republic, where the governments want immediate access to EU labour markets for their citizens. [Handelsblatt, 11th April 2001] The Czechs have said they flatly refuse any transitional period and so a campaign has been launched to discredit that country’s foreign minister: watch this space for further developments. The Polish position is weakened, meanwhile, by Warsaw’s demand for a 15 year transition period before which Germans will be able to buy land in their country.
The Dutch Health Ministry has announced
that it will not oppose the prescription of a “suicide pill” provided that its
use is limited to “very old people who are tired of life.” The decision marks a dramatic new advance in
the rules governing euthanasia and comes within days of the formal legalisation
of euthanasia in the Netherlands: the
new law, it was claimed, would regulate euthanasia and restrict it to people
who were suffering from terminal illness.
The Health Ministry’s decision overturns the legal position because it
has said that it will not oppose the use of the suicide pill for old people
even if they are not ill. The Health
Minister who thus re-wrote the law, so painstakingly developed over the last
couple of years, has now sidestepped the issue of his legal powers by saying
that “being tired of life has nothing to do with euthanasia” because “it is a
matter of liberating people from suffering but not from a suffering connected
with an illness or a handicap.” [Corriere della sera ,17th
April 2001]
III.
Eastern Europe and the former Soviet Union
Feelings are running high in the Croatian parts of Bosnia following the raid on 6th April by Sfor troops on a private bank used by – among others – the Croatian Democratic Union. The raid followed the declaration by the said party that it would no longer be co-operating with the political institutions set up at Dayton after the UN High Representative closed down one of the chambers of parliament because “nationalists” kept getting elected to it. The Croats are now regularly dubbed as “extremists” – like the Albanians in Macedonia and Kosovo – and this language is being used to justify the bank raid during which five truckloads of cash and other bank property was violently removed. [Foreign Press Bureau, Zagreb, 18th April 2001] Now there are rumours that the leader of the Bosnian Croats, Ante Jelavić, is to be arrested on charges of “murder”. If he is so arrested, there is likely to be a huge public outcry: Croat opinion has been highly mobilised by the arrest warrants issued for Croatian generals by The Hague and any new arrest by Sfor would be seen as more colonial meddling by the West. It is quite possible that these developments represent the end of any pretence that the Dayton settlement is anything other than a sham. It would be an irony if Jelavić’s arrest coincided with another imminent arrest, this time in Serbia. The parliamentary leader of the Socialist opposition, Branislav Ivković, has emerged as one of Slobodan Milošević’s staunchest defenders. He too is likely to be arrested soon, for “corruption”.
On a recent visit to Poland, the American Secretary of State, General Colin Powell, has brought pressure to bear on Poland to encourage it to buy US-made fighters instead of British or French ones. Powell also announced a visit to Poland by President Bush this summer. The spokesman of the State Department, Richard Boucher, confirmed that Powell made his case that Poland should buy American to the foreign minister, Wladyslaw Bartoszewski: Boucher said Powell had told the minister that the best plane was American. According to reports, Powell’s efforts are part of a larger lobbying campaign to convince the Poles to buy Lockeed-Martin F-16 jets instead of Dassault Mirages or BAE’s Gripens. Poland is expected to make a decision on leasing 18 aircraft by the middle of the year and to acquire 60 aircraft by 2006 – although it is not clear quite what military threat these new planes are supposed to counter. The State Department spokesman did not say whether the foreign minister had also raised with Powell a law suit being brought in the US by Holocaust survivors who want to force the Polish government to compensate them for property seized by the Nazis, although the Polish foreign ministry has sought to obtain from Washington a promise that the case will be dismissed. Poland maintains that US courts have no jurisdiction in the matter. The US government has taken an active role in similar cases brought against Germany and Austria. [Agence France Presse, 6th April 2001]
Balkan integration proceeds apace
Plans to integrate the Balkans along the same lines as the European Union are proceeding well. The Macedonian foreign minister, Srdjan Kerim, has said that the initiative to create a Balkan committee for security and co-operation, like the OSCE, launched by his Yugoslav counterpart, Goran Svilanović, was on the agenda when foreign ministers from the Balkans met Colin Powell, the US Secretary of State. Kerim said it was vital to improve regional cooperation before joining NATO or the European Union, or other, wider integrations. [Interview in Vecernje novosti, Belgrade, 12th April 2001]