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Spring is traditionally seen as the season of rebirth, renewal and regrowth.  Yet in Brussels, despite the unseasonably warm weather, this could be the Spring of discontent.

In recent months Portugal has been the third country to effectively request a bailout from the Eurozone and the International Monetary Fund (IMF) – this after the former government’s “austerity” proposals had come up against a brick wall in the form of the Portuguese Parliament.  With outside intervention now inevitable, the new government’s hands will be tied in any case.

Meanwhile, at the other end of the continent, the Finns have announced their apparent opposition to continually bailing out their
Southern partners.  The impressive showing of the True Finns party means that it will now likely sit as the main opposition in the Parliament and raises serious questions about the political will in the Member States when it comes to propping up failing economies.

Moreover, talks of Greece “restructuring” its debt are hardly reassuring to Eurozone ears. And if Spain were to join the debtors, it would really put the Eurozone in a downward spiral.

That’s for the euro – but there are wider concerns within the EU which are causing the 27 nation bloc to strain at the edges.

The EU’s budget is being called into question by the net contributors, including the UK and France, who are arguing for “austerity” to be transferred from the national to the EU level and reject any significant increase.

In the opposite corner is a larger group of countries, many of whom are net recipients of EU funds for their regions which lag behind the EU average – and the European Commission.

The battle for the budget has been a perennial highlight of Brussels, but with the current economic and financial context and voters disenchanted, the stakes are higher.

Meanwhile at the EU’s southern fringes there continues to be concern about a supposed flood of immigrants from North Africa following the region’s “Arab Spring”.  Once again, the EU’s solidarity is being called into question, with Franc unilaterally closing its border with Italy to prevent what it sees as a possible influx of French-speaking migrants making their way northwards.

Further north, Denmark also decided to reinstall border controls, ostensibly to reduce crime, but in practice to appease the Danish People’s Party, an anti-immigrant party which the government relies on for support.

Previously EU crises had either been bound up in Treaty reform (e.g. the failed Constitution referenda) or in the EU’s lack of competitiveness on the world stage.

Today, the EU seems to be tearing itself up from the inside.  Paradoxically, the deeper you integrate, the more likely fissures will open up (e.g. Schengen and the Eurozone). The test for the EU will be whether it can withstand the tensions raging from within, rather than without.

– Rob

Sunday’s election in Finland which saw the True Finns party make substantial gains to become a potential “king-maker” in the country’s new government could well be a sign of things to come throughout the Eurozone.

A True Finn drinking some dodgy beer at The Lobby's bar of choice on Place Lux

The True Finns leader – presumably the truest Finn of them all – Timo Soini opposes the Portuguese bailout which will have to be partly funded by the Finnish taxpayer.

The party’s anti-immigrant stance has led them to be seen as far-right and “extremist” – an accusation which Mr Soini stringently denies – but make no mistake: this was coming.

Finland’s accession to the EU was preceeded by a referendum which saw “only” 56.9% say yes. Which of course means 43.1% said no.  A not insignificant percentage.

The yes vote was still higher than Sweden (52.8%, and a non-Eurozone country) but substantially lower than Austria (66.6%) .

When it came to joining the Eurozone however, there was no referendum in Finland, just as there wasn’t in many other Eurozone countries, and they may well be paying the price now.

After all, sooner or later there were going to be problems in one or more Eurozone countries, particularly when the Eurozone decided to invite the “PIGS” (Portgual, Italy, Greece, Spain) to join the party, and presumably, in the spirit of solidarity, the other countries would have to chip in to help out their Euro brethren.

And here’s the thing.  Explaining to the populace that they can use their currency when they’re on holiday on the Algarve = an easy win.  Explaining to the populace that any budgetary problems experienced by their partners will have to be paid for out of their own pocket = not so easy.

This is the crux of the Eurozone’s problems.  Solidarity does not come about because high-level politicians refer to it on a daily basis in Brussels or Helsinki.  Nor does it come about by spending two weeks abroad in the country in question.

Brussels – and in the case of the Euro, Frankfurt am Main – is often accused of being remote and centralised.  Perhaps now they are reaping what they and the political elite in the Member States sowed a decade ago.

– Rob

It was bound to happen sooner or later.  The fact that it is Greece will surprise few, but the sheer extent of the deficit and debt – 12.7% and touching €300 billion respectively – will have come as a nasty shock to fellow eurozone members.

More grim news for ECB President Jean-Claude Trichet (Credit © European Union, 2010)

At last week’s Summit EU leaders raced to show solidarity with Greece but refused to be drawn on what exactly they would do.  Is a bail-out plan on the cards?  Will Greece be asked to leave the eurozone?  Will Germany have to dig into its ever-sparser pockets?

Greece has been accused of fiddling the books for the last few years, which may or may not be true, but what has been conveniently ignored is the contradiction at the heart of the Euro.  Whilst eurozone monetary policy is regulated en bloc from the cosy headquarters of the European Central Bank (ECB) in Frankfurt am Main – 2400km from Athens – fiscal policy remains the sole responsibility of individual Member States.

Inevitably then, Member States are in a position to rack up huge debts if they wish, but then cannot play around with interest rates to rectify the figure.  No-one is saying that EU Member States outside the eurozone are sitting pretty, but at least the Bank of England can respond to the UK’s own needs in a time of crisis.  Whilst Greece burns, other eurozone members are showing signs of recovery, but how should the ECB balance out this tricky equation?

Meanwhile, Greeks are out on the streets demanding a halt to planned government cuts.  The political heat is rising day-by-day, but let it not be said that this is not of the eurozone’s own making.

Meanwhile, eyes are already turning anxiously towards Spain, Portugal, Italy, and even France.  Who would want to join the single currency now?

– Rob

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Birgitta Ohlsson (photo by Roland Karlsson)

Last week Birgitta Ohlsson Klamberg was nominated as Sweden’s new Minister for EU Affairs, stepping into the shoes of Cecilia Malmström, EU Commissioner-designate for Home Affairs. The Lobby takes a closer look at Mrs Ohlsson, who could potentially prove to be Sweden’s EU Commissioner in 2014.

She’s young – born 1975 – and she’s very vocal on a range of issues. According to her blog, topics close to her heart include feminism, democracy, tolerance, solidarity, and animal protection. Yet she is also controversial, and her nomination certainly raised a few eyebrows in Stockholm.

Ohlsson is known to refuse to tow the party line and raise views which stand in stark contrast to her party, the ruling Alliance for Sweden. For instance, she wants to abolish the Swedish monarchy, and whilst the monarchy itself might not be much loved in Sweden, the Royal Family certainly is!

In a recent interview with Dagens Nyheter she stated she wants to address the Roma issue, the sale and trafficking of women in European capitals, and that she is keen to see more green solutions in the EU. Her blog further states she is keen to see Sweden’s development budget be at least 1% of Sweden’s GNI, and she is in favour of joining the Euro, full Swedish NATO membership, and is an outspoken opponent of an Orwellian surveillance society.

She will also have a baby in July, something which, sadly in this day and age, has been pointed out as possibly being an obstacle for her in terms of carrying out her duties as Minister. To this Ohlsson replied, in a rather Swedish fashion on her blog:

“I am married to a modern man, not a dinosaur. I have parents, friends and a large network of wonderful people who will support me rain or shine…unfortunately maybe we still live in the 1950s and not in 2010”

The Lobby can definitely relate to being young, vocal, dynamic and modern – so we see no real issues here. Rather, this young Minister could very well be what the relatively traditional and conservative Alliance For Sweden needs.

– Emil

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