EUROPE
After five years of long and often tortuous negotiations, the EU and US finally signed an 'open skies' agreement that proponents say will lead to increased competition and lower prices on flights between Europe and North America. Critics complained that the agreement did not go far enough and was far too one-sided, with the US not obliged to fully open its domestic market to European airlines. EU airlines will not be able to operate internal US flights or buy US rivals. EUROPE
Leaders of the 27 EU countries gathered in Berlin to commemorate the EU's 50th anniversary, with Chancellor Angela Merkel of Germany – which holds the presidency – declaring the union has been a major force for peace, stability and economic growth. Less celebratory were Eurosceptics, concerned by mooted plans to revive the constitution rejected two years ago by France and the Netherlands; the Pope, who deplored the Berlin Declaration's failure to annunciate Europe's Christian roots; and Turkey, which took umbrage at not being invited to the celebrations despite being an of? cial candidate. THE UK
Due to a City boom time, London has the highest incomes of any world city outside the US – a per capita GDP of €40,400 – according to a survey by PricewaterhouseCoopers. The GDP generated by London's 8.5 million population is equivalent to that of Sweden or Switzerland. By 2020 it will have surpassed Paris, becoming the wealthiest European city, while other capitals like Vienna, Rome and Berlin are expected to slide down the rankings. Mumbai, New York, Tokyo, Mexico City and Sao Paolo will reinforce their positions as megacities with fast-growing GDPs and populations exceeding 20 million. FRANCE
With the first round of voting in the French presidential elections scheduled for 22 April, frontrunner Nicolas Sarkozy received reluctant endorsements from incumbent Jacques Chirac and his erstwhile rival, Prime Minister Dominique de Villepain. Opinion polls showed the gap narrowing between his left-of-centre rivals, socialist Segolene Royal and independent Francois Bayrou, however, suggesting support for the former was around 25% and the latter 23%, against around 31% for Sarkozy. Two candidates will go through to the final round, to be held on 6 May. GERMANY
Despite fears about the strength of its recovery, Germany's economy continues to perform better than expected. The latest Ifo Business Climate Index topped expectations at 107.7 against a predicted 106.5, suggesting that the recent rise in VAT to 19% was having less of an impact than predicted. Ifo reports that manufacturers and retailers are particularly optimistic about business conditions over the coming months. Forecasters are now predicting that growth over 2007 will be much stronger than predicted; London-based research firm Independent Strategy is anticipating GDP growth of 3%, which would make Germany one of the EU's main growth engines. CYPRUS
After a year-long stand-off following the Turkish Cypriot decision to knock down their side of a barrier in the Cypriot capital and build a controversial bridge to the Greek Cypriot side, the Greek Cypriots knocked down their side of the wall after strong pressure from the EU and UN. Major building work will be necessary before people can cross the Green Line here – barriers and barbed wire have been in place since before 1974, and many of the surrounding buildings are structurally unsafe. The eventual opening of the crossing in Ledra Street in the heart of Nicosia's old city will be of immense symbolic signi? cance and is expected to encourage an increase in direct contact and trade between the two communities. THE NETHERLANDS
Buyer interest in ABN Amro, the country’s biggest bank, ran high after a friendly merger plan with domestic rival ING fell through and Barclays stepped forward with a plan to create the world’s fifth-largest bank, valued at over €120bn. At press time, Barclays hoped to secure the support of ABN Amro’s management and employees with concessions including minimal job losses and the siting of the group headquarters in Amsterdam. Barclays is keen to access ABN Amro’s extensive Asian business, although critics say the merger will create few real business synergies. RUSSIA
There was another dubious auction and another nail banged into the coffin of Yukos, once Russia’s largest and most profitable oil company, as its 9.44% stake in Rosneft was snapped up within seconds… by Rosneft. Critics say that despite the participation of TNK-BP, the last large foreign joint venture in the energy sector, the auction was rigged, with Rosneft able to buy its shares at a discount to the market at just a whisker over the starting price of €5.6bn. TNK-BP, the only other bidder, was accused of participating without having any serious intention of buying the stake in order to curry favour with the Kremlin. RUSSIA
Further concerns about creeping authoritarianism after elections saw pro-Kremlin parties win in all 14 of Russia’s regions: the established pro-Putin party, United Russia, won 13, and a new pro-Putin one, Fair Russia, took the remaining region. Turnout was just under 40% in the contest, held under controversial new electoral rules that raise the threshold and prevent smaller parties from forming electoral coalitions. The vote is seen as a precursor to the key presidential and parliamentary elections, with the Communist Party and the neo-fascist but pro-Kremlin Liberal Democratic Party the only two “opposition” parties to garner any sizeable support. Sergei Ivanenko, deputy leader of the liberal Yabloko party – which was barred from standing in some regions and has generally seen support fade – said the elections proved Russia is a “managed democracy”. POLAND
The Polish government has promised to radically cut the amount of red tape surrounding private business after growing criticisms from business organisations that the country has become increasingly bureaucratic. The number of days needed to open a business is to be cut from 31 to just three, while the power of government bodies to investigate private companies will be streamlined. Businesses have been complaining that they are spending too much time and money complying with complex official regulations, many of which are open to varying interpretations. SLOVENIA
Just three months after Slovenia became the only new accession country to qualify for euro membership, it faced the unprecedented embarrassment of having nobody to represent it on the governing council of the European Central Bank (ECB) in April. With the government opposed to renewing the contract of incumbent Mitja Gaspari because of his close ties to the former Liberal Democrat government – and rejecting the president’s candidate, Gaspari’s deputy – Slovenia faces a prolonged period without an official representative at the ECB. TURKEY
Ankara’s difficulty in reconciling basic freedom of expression with its traditional sensitivity towards any criticism of the state once again came under the spotlight as the government blocked access to YouTube after the website carried reportedly insulting pictures of Turkey’s founder, Kemal Ataturk. The country has been under strong international pressure to reform Article 301 of its constitution, which makes it an offence to “insult Turkishness” but defies European norms of free speech. Numerous writers and journalists have faced prosecution under the article. |