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41. The Macroeconomic Imbalance Procedure and Germany: When is a current account surplus an 'imbalance'?

Author:
Daniel Gros and Matthias Busse
Publication Date:
11-2013
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies
Abstract:
The Macroeconomic Imbalance Procedure (MIP) was designed to prevent the emergence of imbalances like the large and persistent current account deficits that occurred in Spain and Ireland. But within this mechanism, a current account surplus is also viewed as a source of concern. Indeed, last year's Alert Mechanism Report (AMR), issued by the European Commission signalled an excessive current account surplus for the Netherlands and Luxembourg, while Germany just barely scraped by with a 5.9% surplus, marginally evading the 6% threshold (over a 3-year average). With the most recent report, however, Germany's status has changed. Along with the Netherlands and Luxembourg, it too has now been singled out as a euro-area country with a surplus above the upper threshold.
Topic:
Economics, International Trade and Finance, Markets, Monetary Policy, and Financial Crisis
Political Geography:
Europe and Germany

42. Financial regulation and the G20

Author:
Hugh Jorgensen, Mike Callaghan, Stephen Pickford, Richard Gray, Steven Bardy, Graham Hodges, and Ross Buckley
Publication Date:
07-2013
Content Type:
Working Paper
Institution:
Lowy Institute for International Policy
Abstract:
This issue of the Monitor canvases the role of the G20 in strengthening financial regulation. It contains articles by Hugh Jorgensen (Lowy Institute), Stephen Pickford (Chatham House), Richard Gray (Westpac), myself, Steven Bardy (Australian Securities and Investment Commission), Ross Buckley (University of New South Wales) and Graham Hodges (ANZ). It also includes a summary of the discussion at a regional 'Think 20' seminar recently held at the Lowy Institute.
Topic:
Economics, International Organization, International Trade and Finance, Financial Crisis, and Reform
Political Geography:
United States and Europe

43. Pushing the Turbo Button: What Next for the Polishâ?"Romanian Strategic Partnership?

Author:
Stanislav Secrieru, Lukasz Kulesa, Agnes Nicolescu, and Anita Sobják
Publication Date:
11-2013
Content Type:
Policy Brief
Institution:
The Polish Institute of International Affairs
Abstract:
With the global economic downturn and its implications for the broader political and security architecture of the EU, the Polish—Romanian Strategic Partnership signed in 2009 is now ripe to take the positive relationship to a new level and to be further fleshed out. To this end, political coordination needs to be upgraded for promoting common interests, such as economic stability and solidarity within the Union, continued support to agriculture and cohesion policy as an important priority for EU funding, increasing the energy security of the region, engaging the neighbourhood, particularly Moldova and Ukraine, and maintaining the relevance of CSDP and of article 5 of the Washington Treaty high on the European agenda. The management of instability and protracted conflicts in their neighbourhood are also among their shared concerns. Translating these common priorities into concrete actions should aim at pushing the "turbo button" on the partnership, and help both countries achieve their goals.
Topic:
Security, Debt, Diplomacy, International Trade and Finance, Monetary Policy, and Financial Crisis
Political Geography:
Europe

44. Poland and Spain: How to Cooperate in a Europe in Flux

Publication Date:
07-2013
Content Type:
Policy Brief
Institution:
The Polish Institute of International Affairs
Abstract:
The lingering effects of the eurozone crisis have weakened the European project as a whole. As a result, stronger and more effective cooperation between enthusiastic EU countries such as Poland and Spain is very much needed. Besides cooperation within the EU in such fields as completing the single market and promoting a more holistic approach to the European Neighbourhood Policy, both countries should focus on improving their economic ties in bilateral relations and beyond. Through "smart" trade triangulation, Poland could open new markets in Eastern Europe for Spain, and Spain could reciprocate by doing the same for Poland in Latin America. This could help Poland make the economy more competitive and give Spain a lever for economic recovery.
Topic:
Economics, Bilateral Relations, Monetary Policy, and Financial Crisis
Political Geography:
Europe and Latin America

45. Eurocriticism: The Eurozone Crisis and Anti-Establishment Groups in Southern Europe

Author:
Nathalie Tocci, Thanos Dokos, Eleonora Poli, Chiara Rosselli, and Eduard Soler i Lech
Publication Date:
12-2013
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The Eurozone crisis and the ensuing public disaffection towards what many view as deficient EU institutions and policies have resulted in a surge of euroscepticism across member states. Although euroscepticism is not a new phenomenon, the rise of mass anti- establishment movements notably in southern Europe is. Despite their different political and structural features, Five Star Movement in Italy, Syriza in Greece and several social movements sprung from the Indignados in Spain have recently become key actors in their national political arena by opposing, inter alia, EU-imposed austerity. Yet these movements are not anti-EU in toto; while they criticize what they view as the EU's lack of democracy and rigid economic policies, they are not opposed to the EU integration project as such. While a fine line distinguishes Euro-scepticism from Euro-criticism, provided such distinction is made, the critique of these movements could be galvanized into a constructive force for a more integrated EU political space.
Topic:
Debt, Economics, International Trade and Finance, Financial Crisis, and Reform
Political Geography:
Europe

46. Challenges for the German Welfare State before and after the Global Financial Crisis

Author:
Mark Hallerberg
Publication Date:
04-2013
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
Germany has a northern European welfare state. This means that social benefits are extensive compared not only to the American standards but compared to other European countries, such as Italy or Spain. In the early 2000s, both foreign observers and Germans themselves considered the country the “sick man of Europe.” Its firms seemed increasingly uncompetitive, due especially to its costly labor. Economic growth in this period was stagnant. This “exporting giant” even had a slight current account deficit.
Topic:
Financial Crisis
Political Geography:
Europe, Germany, Spain, and Italy

47. Danish Foreign Policy Yearbook 2013

Author:
Hans Mouritzen (ed) and Nanna Hvidt (ed)
Publication Date:
06-2013
Content Type:
Book
Institution:
Danish Institute for International Studies
Abstract:
This year's volume presents the official outline of Denmark's foreign policy in 2012 by Claus Grube, Permanent Secretary of State for Foreign Affairs. Besides that Ravinder Kaur contributes with the first academic inquiry into the causes of the Danish-Indian diplomatic deadlock in the extradition case concerning Niels Holck (the prime accused in the Purulia arms drop case). Mette Skak addresses the role of the emerging BRICS powers (Brazil, Russia, India, China, and South Africa) in Danish foreign policy and offers her policy recommendations. Hans Branner shifts to a diachronic perspective. In his article about Denmark 'between Venus and Mars' he stresses elements of continuity in Danish foreign policy history; activism is not solely a post-Cold War phenomenon. Derek Beach turns to the scene of the current European economic crisis, analysing and interpreting the Fiscal Compact agreed during the Danish EU Presidency.
Topic:
Foreign Policy, Diplomacy, Economics, International Affairs, and Financial Crisis
Political Geography:
Russia, China, Europe, India, South Africa, Brazil, and Denmark

48. The German Election: No vote for Europe?

Author:
Timo Behr and Tuomas Iso-Markku
Publication Date:
08-2013
Content Type:
Policy Brief
Institution:
Finnish Institute of International Affairs
Abstract:
The outcome of the German federal elections on September 22nd will have a significant impact on the management of the on-going eurozone crisis and set the tone for the future course of European integration. Although the EU and the euro are largely absent from current electoral debates, significant differences on these issues exist both inside and between German political parties in the run-up to the September polls. However, in the absence of significant debate, fundamental decisions over the future of EU integration will be postponed until after the election, when a cross-party compromise appears more feasible. Regardless of the election outcome, the next German government is likely to prove more conciliatory on austerity policies in Europe and will boost domestic spending, but will retain some red lines on further EU integration. While the rhetoric and the pace of change might differ significantly depending on the shape that the next coalition government takes, German eurozone policies will continue to trade fiscal solidarity for structural reforms.
Topic:
Economics, Markets, Financial Crisis, and Governance
Political Geography:
Europe and Germany

49. The Greek Debt Restructuring: An Autopsy

Author:
Jeromin Zettelmeyer, Christoph Trebesch, and Mitu Gulati
Publication Date:
08-2013
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
The Greek debt restructuring of 2012 stands out in the history of sovereign defaults. It achieved very large debt relief— over 50 percent of 2012 GDP—with minimal financial disruption, using a combination of new legal techniques, exceptionally large cash incentives, and official sector pressure on key creditors. But it did so at a cost. The timing and design of the restructuring left money on the table from the perspective of Greece, created a large risk for European taxpayers, and set precedents—particularly in its very generous treatment of holdout creditors—that are likely to make future debt restructurings in Europe more difficult.
Topic:
Debt, Economics, Monetary Policy, and Financial Crisis
Political Geography:
Europe and Greece

50. Fighting the Fed

Publication Date:
08-2013
Content Type:
Policy Brief
Institution:
Oxford Economics
Abstract:
Since the US Federal Reserve signalled that a turn in the interest rate cycle may be on the horizon, UK and to a lesser extent Eurozone interest rates have tracked US rates higher. But the UK and Eurozone economies are less well placed than the US to cope with higher interest rates. Simulations carried out on our Global Economic Model show that higher rates would be particularly harmful to the UK economy's embryonic recovery. In an attempt to stem the rise in interest rates, the Bank of England and the ECB have introduce forward guidance but with little, if any, success. Markets do not seem convinced by the Bank of England's commitment to forward guidance and are testing its resolve. It seems likely that over time both central banks may have to strengthen their forward guidance, in the case of the Bank of England by augmenting it with further quantitative easing.
Topic:
Economics, Markets, Monetary Policy, and Financial Crisis
Political Geography:
United States, United Kingdom, and Europe