www.neweurope.eu 22nd Year of Publication Number 1080 11-17 May, 2014 € 3.50

Russia Page 11 by Ariti-Marina Alamanou Page 28 by Gianni Pittella Page 09

Saying thatDo a merger ofyou two airlines trust this man? does not harm competition, because WHITE BOOK one of them would have gone out of ON VIOLATIONS OF HUMAN RIGHTS AND THE RULE OF LAW business soon anyway, is like a crimi- IN UKRAINE nal court acquitting a murderer of a (NOVEMBER 2013 — MARCH 2014) cancer patient on the grounds that Libya Page 12 since the victim was anyway going to A bold agenda for die, the murderer had caused “no ad- ditional negative effect”. But this is exactly what the Thethe European next elections Parliament “will be decisive for Commission’s Vice-President in the future of the European Parliament,” says charge of competition policy Joaquín Gianni Pittella MEP and Vice-President. Almunia did in the Aegean and With populist parties rising, he says “it is there- Olympic airlines merger that led to fore essential that all pro-European political the creation of a monopoly. forces” should rally and not be defensive.

by Andris Vilks, Finance Min Page 07 Latvia’s experience in the euro changeover ŠtefanThe Füle on Russia, Ukraine,negotiator Moldova, Georgia, Azerbaijan and more he EU has failed to grasp by Christos Kissas, Phd Page 03 Putin’s intentions, says Štefan Füle, EU Com- Tmissioner in charge of Enlarge- Piketty or ment and Neighbourhood poli- cy, in an exclusive interview with not Piketty? New Europe. The EU misunderstood him "many years ago, when Putin said that the biggest catastrophe of the 20th Century was the dissolution of the Soviet Union, then in 2008, by New Europe Page 03 at the NATO-Russia summit in Bucharest, when he said that Uk- raine was an "artificial country”. EU sanctions "I am very concerned”, says Füle, "to see a policy of "mana- and the failure geable chaos" being introduced in Ukraine. Where exactly are the limits of “manageable"? To what of the EEAS extent can one “manage" chaos? I would hate to see anyone pla- ying games with the purpose of Štefan Füle speaks at New Europe Studios

www.neweurope.eu A New Europe Special Supplement NEW EUROPEMay 2014 determining who is going to pay The Assembly the biggest price for Ukraine: Mo- partner in energy? Yes, it is!” says the crisis in the Eurozone. The- of europeAn regions A pArTner for regionAl growTh scow or Brussels? We are not into Fule, hoping to expand strategic re were a number of ways to do A partner for The AER Business Community he business world has changed. that kind of game." relations, adding that he will visit it. We have probably chosen the Today, there are no borders and no currencies. The definition of “Tcompetitiveness has also evolved; we can’t boost enterprises through the traditional an- nual fairs or other old-fashion tools. We need to encourage regional business and small and medium enterprises towards a constant Giovanni Chiodi, dialogue with their counter partners and in- troduce them to new stakeholders. Therefore, President of the Štefan Füle also details the with Oettinger and may accompa- most difficult one: to strengthen it is with great honour that I accept to be in Abruzzo Region charge of the AER Business Community”. This statement byGiovanni Chiodi, Pres- (IT), took officially ident of the Abruzzo Region (Italy), got the attention of New Europe. Throughout the charge of the this supplement we will focus our atten- “AER Business tion on how to get new business opportu- nities without the European Commission Community” in following steps for consolida- ny President Barroso. the credibility of the process. In support, neither National Governments but through regional authorities. Pescara in regional growth For those who don’t know this associa- April 2014. tion, established in 1985, the Assembly of European Regions is the largest indepen- dent network of regions in wider Europe. In fact, AER brings together nearly 230 touch with new markets and to extend their – whose vision is to be the world leader in region’s growth, by highlighting its eco- regions from 35 countries and 15 inter- network at the regional level. A level consid- sustainable transport solutions – welcomes nomic assets and innovative businesses. regional organisations. All regions within ered by AER as very accessible and flexible, the opportunity to cooperate with the As- One part will also be dedicated to educa- ting Moldova and Georgia, and Füle also dwells at length on the last two and a half years, we Council of Europe states can join this making it a privileged interlocutor for grow- sembly of European Regions. This experi- tion. A student will guide the viewer, invit- network. Regions are defined as authori- ing business. This Community is composed ence will provide us with a better insight of ing him or her to visit the university world ties immediately below the level of central on the one hand of a privileged pool of co- regional mobility challenges and transport and meet foreign students. government, with a political power of rep- founders and other members from the pri- needs so that, together, we will be able to de- The end of each episode will highlight resentation, as embodied by an elected re- vate sector. On the other hand, it gathers dy- velop sustainable European Regions” stated the different modes of transportation and gional Assembly. In the past few weeks, we namic, open-minded and innovative SMEs Frédérique Biston, Vice-President of infrastructure available in the area, such got to know its current views through its that are looking for internationalisation and Volvo Group. as regional airports, high speed trains, etc. Secretary General, Pascal Goergen and new markets. Some concrete projects have already The aim of “European Regions” is to en- announces that Albania might we’ll soon have a chat with its President, the way he managed to maintain All of these companies are included in come out from these partnerships, such as courage familiarity and dialogue between went from a box-ticking exercise Hande Özsan Bozatli, who is also the AER’s activities where they can find op- the “European Regions” campaign, brand- cultures as well to promote tourism and Vice-President of the Metropolitan area of portunities for interregional economic ed by AER and led together with UNICAP discovery of the highlighted region. “Eu- Istanbul. exchanges, share best practices and inno- Television. ropean Regions” will also lead the view- This Assembly launched its Business vative ideas, as well as improve their cor- “European Regions” will be a series of ers to a wealth of undiscovered culture. Community last 8 April 2014. The main porate image and reputation. documentaries inviting television viewers With its unusual places and memorable purpose is to establish concrete and sustain- Today, it can already rely some co- to discover a region through its heritage, interviews. able links between the private sector and founding members such as Brussels Air- whether it is tangible or intangible, cul- This project is truly the essence of this regional authorities from its member re- lines, Volvo, Accor Hotels, UNICAP Tele- tural, architectural, historic, touristic, in- Community to put companies and region- finally receive the candidate sta- the momentum of enlargement: to a project of political transfor- gions. In other words, it seeks for a win-win vision and BNP Paribas Fortis. One of dustrial or gastronomic. Each episode will al authorities together in order to create partnership by helping companies to get in them shared testimony: “The Volvo Group show the industrial heritage, namely the innovative ideas, growth and jobs. tus at the EU Council in June, "The most challenging job I had mation. Track record matters, and when Moldova and Georgia will in the last two and a half years was I am very happy to see the first sign their own Association agree- how to keep the enlargement alive small results.” ments. “But it is up to the member at a time when the basic instinct of One main result of this has states” to take the final decision, the whole European Union and of been the start of the negotiations concedes Štefan Füle. the members states was to focus between Serbia and Kosovo. “Is Azerbaijan our strategic on the economy, the finances and (Pages 04-05) NEWEUROPE 02 www.neweurope.eu ANALYSIS 11-17 May, 2014

The Shooting Gallery MM What will these European elections bring for the EU? It is a commonly understood fact that the upcoming European Par- liament elections are of crucial importance. Not only is it important for the future of the European Parliament, but for the future of the entire European Union as well. Of course, there are some positive elements like the fact that this is the first time that political parties and political groups in the European Parliament have nominated candidates for the position of European Commission President. The fact that each party has openly declared who they will appoint as the next President if they win enough votes to influence his designation is of course a step toward transparency in EU decision-making. But this does not seem so important if one looks at what these elec- tions could bring to the European Parliament. It looks as though an army of different kinds of Eurosceptics and, worse still, enemies of Strictly speaking, the German Chancellor didn’t say anything when asked about Martin Schulz’s chances of becomming anything to do with the European Union are preparing to invade Commission President, but some claimed to have detected a clue AFP PHOTO / DPA / CARMEN JASPERSEN Brussels. Their ships will sail with the strong winds of the far-right, xenophobia, racism and radical regionalism. In every country of the EU there is now a political party that sup- THE EUROPEAN WEEKLY

ports these Eurosceptic ideas. In France, Marine Le Pen knew how cyan mage yello to revamp the out-dated National Front and transform it into a black New Europe more modern party. But the essence remained the same and her 12th Year, Number 573 www.new-europe.info May 16 - 22, 2004 10 YEARS New Europe Interview Oil crisis ne Viktor Yanukovich, Prime party is a bastion of Euroscepticism in Europe. This is a fact that deepens European research set Minister of Ukraine Oil prices soared to a record last Thursday on the New It takes two to tango, p. 37 York Mercantile Exchange, has had little impact on the French since the National Front’s pop- crossing USD 41 a barrel and AGO settling at the highest point in to reach Lisbon goals the 21-year-history of crude New Europe bylines futures trading in New York. Commissioner Busquin reiterates research awareness importance ularity is on the rise. OPEC ministers appeared to Investments disagree on whether to in- hilippe Busquin, crease the group's official the European increase import production ceiling. President commissioner for By Peter Mihok, President, Ten years ago we interviewed Ukrainian Premier, Across the English Channel, there is a new phenomenon: the UK Purnomo Yusgiantoro said P Research, reiter- SCCI, Deputy-President, there was no consensus yet atedP his pragmatic zeal with Eurochambres, p. 27 among members to increase an unsullied faith to carve Viktor Yanukovich, as we did last week, under very the group's official produc- out “a dynamic and coher- Independence Party led by Nigel Farage, who has promised his tion ceiling as proposed by ent European Research Athens Olympics 2004… Saudi Arabia, but Indonesia Area (ERA).” Speaking at supported the rise. the “Communicating Euro- The Zorba Dance different circumstances. Commissioner Busquin OPEC which controls about pean Research conference By Alexander P. Panagopulos, half of world crude exports, is in Brussels (May 11-12),” Chairman of the High Level Ferry voters he will work seriously to take the country out of the EU. due to review production pol- the commissioner stressed was promising that he could bring about “a dynamic icy on June 3 in Beirut. the need for the involve- Group of ECSA, p. 5 As the situation in the Mid- ment of the European citi- dle East worsens, analysts zens to get the concept of Farage’s party has also gained in popularity by feeding off the psy- predict that high oil prices research loud and clear. The Fresh things at and coherent European Research Area” and argued could last as long as two or event was marked by frank three months. Moreover, a dialogue session between WTO round new attempt by the United Commissioner Busquin and that spending 3% of GDP on research would her- chological and economic stress of a possible Scottish defection. States to involve Syria in its journalists discussing in European Union Commissioner Philippe Busquin The European Union took a bold and anti-terrorism campaign may detail the challenges sur- pragmatic step last week while offering to push prices even higher, For- rounding an effective com- said, “I shall continue to R&D spending to three per- million jobs between 2010 cut agricultural export subsidies in order to ald a new era of growth and the creation of over ten mer Greek Energy Minister munication with respect to support it as a citizen, a cent of GDP: "European and 2030." revive the failed world trade round. In the Netherlands, once a pioneer of the European idea and one Elefterios Verivakis said. He the European Research member of European Par- research needs a qualitative However, he stated that Editorial p. 2 noted that oil prices could Area. liament or as a commission- and quantitative boost, as it not only a financial boost move much higher than USD Answering a question er.” generates more than half was needed, but also the million jobs. While oil prices were rising past $41 a 40 which could lead to a crisis from New Europe, the com- Eulogising the research the economic growth. Stud- investment had to go to the Raffarin for of the most tolerant countries in Europe, the far-right Party of especially if the banks decide missioner declared his share of four percent of ies show that reaching the right structure and priority parallel votes to increase interest rates unflinching mission to stay GDP in Sweden and 3.6 three percent target would areas that were correctly barrel, there were hints of better relations with the leading to inflation. on the path to nurture his percent in Finland, Busquin trigger a period of growth evaluated and organised. French Prime Minister Jean-Pierre Raf- p. 45 brain child, ERA. Busquin advocated the increase in and create more than ten p. 3 farin recently suggested that all 25 EU Freedom (PVV) led by Geert Wilders (widely-known for his pes- members vote together on a constitution for the Union. US as a reform to tax legislation, which was seen as Italian-born leads Indian NOTEBOOK p. 10 transferring subsidies into corporate tax cuts, led the simism about the Eurozone’s future), proposes that his country Congress to poll victory EU watches US moves with WTO rulings Milan, the engine he Congress Party will take the lead in forming a The European Union hinted last week Commenting on the decision, EU Trade of economy "strong, stable, secular government at the earli- T that it would lift millions in trade sanc- Commissioner Pascal Lamy said the Sen- EU to reconsider their imposition of tariffs, put in est,” the party's Italian born president Sonia Gandhi According to a report of the Chamber of should abandon the Eurozone. tions against the United States once a ate had taken "a very important step" said at a news conference late last Thursday. She Commerce published on the occasion of contentious US tax law is fully repealed, towards ending one of the worst transat- refused to name a prime ministerial candidate, saying the economy day, Milan is still the engine after the US Senate approved a tax reform lantic trade disputes. But he noted that it place to counter what Brussels saw as unfair trade, her party's elected MPs would take a decision later of Italy's economy. scheme. Earlier the US Senate voted for over the weekend. must still be approved by the House of p. 13 The list of far-right parties and their anti-European proposals is USD 170 billion in corporate tax cuts to "On behalf of the Indian National Congress and on Representatives. replace export tax subsidies that had gar- behalf of all our allies we thank the Indian voters for a view backed by the World Trade Organisation. nered retaliation from the European Lamy said: "I very much hope that the Companies head the confidence they have reposed in us," Gandhi said Union. House will soon follow so that an FSC long and includes the ultra-radical far-right parties in Hungary, of her party's surprising victory in the Indian nation- repeal bill is rapidly adopted and signed for China al elections. The World Trade Organisation (WTO) into law by President (George W.) Bush. There was relief on both sides of the Atlantic as a Britain's business lobby has gained a Sonia Gandhi was born December 9, 1946 in Orbas- had ruled in favour of a European Union That will be good news for all involved in sano, a small town near the city of Torino in Italy. Her complaint, authorising the economic bloc stronger foothold in the fast-developing transatlantic trade. Let's hope the time Chinese market. Main business firms Greece, Sweden, Finland, as well as the strong Freedom Party in father Stefano Maino made his money in the booming to gradually impose USD 4 billion in has come to put this long-standing dispute long standing dispute was heading towards closure. recently clinched major deals in China. construction industry. She once said that when she punitive tariffs a year on jewellery, paper behind us once and for all." p. 14 met Rajiv in 1965 she had "a vague idea that India and other imports from the United States. existed somewhere in the world with its snakes, ele- The legislation, passed by the Senate with At the start of March, the EU had slapped Australia $3.4, Austria EURO 1.81, Balkans EURO 4, Bel- gium EURO 3.50, Holland EURO 2.70, Central Asia Sonia Gandhi was forming a government in India af- phants and jungles, but exactly where it was and what a 92-5 vote, now goes to the House of millions in sanctions over tax breaks given Austria. USD7.5, Central Europe USD5, Canada $5, Cyprus CYP it was all about, I was not sure.” Representatives. The measure approved to US exporters under the FSC and the 1.80, Denmark: DKK 19.95, Eastern Europe USD7.5, France Now she could create history as India's first prime tax cuts for certain manufacturers and Extra Territorial Income Act (ETI), EURO 3.04, Germany EURO 3.57, Greece EURO 4, Hun- which have both been ruled illegal by the gary HUF430, Japan Y900, Italy EURO 3.62, Nordic coun- ter a surprise victory in the elections, marking their minister of foreign origin, thanks to the electorate of new rules to allow US firms to defer taxes tries USD7, Pacific Rim USD8.5, Russia USD 4, Switzerland New Europe has repeatedly reported that Brussels is largely re- the world’s largest democracy. on overseas profits. WTO. first foreign born leader. sponsible for the rise of Euroscepticism since poverty, unemploy- ment, absence of a clear immigration policy, distance between the EDITOR Director Brussels headquarters European societies, the citizens, and the European politicians are Basil A. Coronakis Alexandros Koronakis Av. de Tervuren/Tervurenlaan 96, [email protected] [email protected] 1040 Brussels, Belgium the unresolved problems of today’s EU. Tel. +32 2 5390039 It is true that the major political parties underestimated the dan- PRINCIPAL EDITORIAL ADVISORS Executive layout producer Fax +32 2 5390339 [email protected] ger of the far-right and Euroscepticism for the future of EU. Their Konstantin Tsapogas von Taube Suman Haque [email protected] [email protected] N EW EUROPE STUDIOS leaders enjoyed declaring that far-right parties even if gaining more Theodoros Benakis (Print ed.) Rue Froissart 1 - Place Jourdan votes will not be able to affect European functions. [email protected] Subscriptions & Distribution Brussels 1040 Belgium Now, different voices are warning us about the dangers that are in [email protected] Tel. +32 2 3107667

Senior Editorial Team Subscriptions are available worldwide www.neweuropestudios.com u

front of us. In a special feature about the European Parliament elec- Kostis Geropoulos n Publishers tions, Le Monde, for example, reported Eurosceptics could win as (Energy & Russian Affairs) INDEPENDENCE Brussels News Agency SPRL [email protected] New Europe is a privately owned many as a quarter of the seats in the European Parliament. ISSN mber: 1106-8299 Andy Carling (EU Affairs) independent publication, and is not Avenue de Tervueren 96 Just imagine what would happen if this were the case. The Euro- 1040 Etterbeek Belgium [email protected] subsidised or financed in any way by Tel. +32 2 5390039 pean Parliament has managed to function through compromise. Dan Alexe (EU Affairs) any EU institution or other entity. [email protected] Will this even be possible if 25% of the MEPs were elected on a [email protected] New Europe (print and digital) accepts external contributions for publication under the Ariti Alamanou (Legal Affairs) conditions of no financial or other obligation, no obligation for publishing and no clear anti-EU platform? [email protected] obligation to return manuscripts photographs or videos. Signed Contributions express solely the views of the writers and do not necessarily reflect After May 25, the political parties that are devoted to the European Louise Kissa (Fashion) the opinion of the newspaper. NE is printed on recycled paper. idea must get to work. They must work hard to win back the Eu- [email protected] © 2014 New Europe all rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form by any means, electronic or other- ropean citizens and to regain their confidence in our common and wise, without express permission. The Publishers accept no liability for third party views published, nor damage caused by reading, viewing or using our content. All information is united house that is the EU. correct at the time of going to print, we accept no liabilities for consequent changes. NEW EUROPE NEWEUROPE www.neweurope.eu 03 11-17 May, 2014 ANALYSIS

By Christos Kissas, PhD www.christoskissas.com

Piketty or not Piketty?

lright, I’m not going to analyze Pik- would act as a counter-incentive for being etty. I’m sure you’ve already read rentiers. Ironically, in an 1988 article in the several reviews on his theory, and French magazine L’ Expansion, weeks after probablyA even some articles that contradict Maurice Allais had received the Nobel Prize his policy recommendations—to impose a in economics, another of his ‘students,’ global tax on capital with punitive rates for Dominique Strauss-Kahn, had written “[Al- the ultra rich. The debate is already so in- lais’] work is so rich and diverse that some tense that it seems like the world is shaping people will become famous by just using a into two distinctive groups, the pro and anti footnote of one of his pages”… Piketty thinkers. From a different angle, in August 2012, EU foreign policy chief Catherine Ashton (L) and Russian Foreign Minister Sergei Lavrov (R) In fact, every ‘decent’ person these the venerable German Institute for Economic EPA/MAXIM SHIPENKOV days, has heard about Piketty; for the few Research (DIW Berlin) had also formulated who haven’t, he is the author of a best sell- proposals for a 10 percent capital tax on per- ing book on capitalism that tops sales on sonal net wealth exceeding 250,000 euros Amazon and is viewed by many as the most per taxpayer. From their perspective, this EU sanctions and the interesting economics book of the decade; should be a one-off levy and would target some even name him the ‘new Marx.’ What debt redemption rather than inequality. The is really surprising is that a nearly 700-page proposal was subsequently adopted by sev- book on economics has attracted such at- eral German politicians, and later appeared failureanctions have become of one of thethe or benefit, EEAS made part of the problem the tention, and sold more copies that any fic- as a measure to be applied to all of Europe, active foreign policy tools of the Eu- Russians who are handling the crisis and tion or travel book. This very fact alone says in order to tackle the debt issue. ropean Union over the last decades. working for a solution. it all: that he is pointing at a real problem, From a practical point of view, several SWhile the effectiveness of these “soft Yet the real question is whether it is inequality. Piketty analyzed income and countries already have a form of wealth tax, power” instruments has been a subject the first case when one country violates wealth over the past 300 years in Europe either in the form of a property tax, or a soli- of discourse from time to time, the real the principles of international law and and America. His main conclusion is that darity tax; or have applied it in the hardest analysis of its reasons and outcomes still sovereignty and territorial integrity at the the (not so well explained) rate of return form of a one-off levy on bank deposits, as needs to be more explored. expense of a neighbour. on investment outstrips the overall rate of in Cyprus at the moment of the bail-in. So, The European Union imposes sanc- The recent history of Russia-Georgia growth of the economy. In other words, his- what is the new element that makes Piket- tions or restrictive measures in pursuit of war of 2008 is a flagrant case where the torically, the return on capital is bigger than ty’s theory so attractive, and why did it gain the specific objectives of the Common For- EU opted for dialogue and negotiations the average GDP growth, which means that worldwide interest this time? eign and Security Policy (CFSP) according with Russia rather than sanctions. Even capitalism is threatened by capital ‘eating To answer this question, one must re- to the Article 11 of the Treaty on European worse was the case of Armenia, which away’ an ever-increasing part of the wealth fer to the issues behind the proposal for a Union. These sanctions are particularly occupied the territories of neighbouring produced over the years by the economy. global tax on capital—which problems is imposed against the countries violating Azerbaijan. Indeed, despite the fact that Well, as expected, there are many ob- the tax supposed to address? Historically, the political values, fundamental freedoms occupation has been clearly recognised jections to this theory. There are even ‘anti- there have been four considerations: a) to and with the aim of preserving peace and and condemned by the UN, the Council piketty’ groups forming on social networks. ‘moralize’ possession of wealth, b) to in- strengthening international security, in ac- of Europe and other international organi- But, as I promised at the beginning, I’m not crease capital efficiency, c) to provide a solu- cordance with the principles of the United sations, the EU not only didn’t implement going to dive into economic analysis, given tion to the international debt problem, and Nations Charter and the Helsinki Final sanctions against Armenia, but it has even that the interested reader can find more d) to reduce inequality. Of those four, the Act. As for January 2014, the EU’s list of invited the latter for a closer partnership. authoritative sources on the subject (Tyler debt problem and inequality are the current states against which the sanctions were di- The question therefore is why the Eu- Cowen’s article in Foreign Affairs, and Philip drivers. It is reasonable, some will claim, rected included 34 states. Russia joined this ropean Union applies its policy of restric- Mause’s analysis in Seeking Alpha are two that those who mostly profited from the ex- list after the annexation of Crimea and its tive measures selectively and how this com- good starting points.) What is more inter- traordinary accumulation of wealth over the threatening of the territorial integrity and plies with the UN Charter and our political esting here is to jump directly to the book’s last 30 years, give back a percentage of their sovereignty of Ukraine. civilisation. It should be reminded that the conclusion: the introduction of a global tax fortune in order to help resolve the over-in- The issue of consistency of the EU’s representatives of the breakaway regions, on capital. Such a tax should be progressive, debtedness problem that emerged as a char- policy of sanctions, however, remains to (i.e. South Ossetia, Nagorno-Karabakh, according to the author, and hit the very acteristic of that period. On the other hand, be seen. No doubt that the aggressive pol- Abkhazia) not only are subject to restric- wealthy individuals hard, especially those inequality is no longer an abstract idea, but icy of Russia towards Ukraine is a clear tive measures, but benefit from unrestrict- who inherited large fortunes and didn’t pro- a serious threat to the middle classes around violation of the UN Charter and Helsinki ed travel across Europe. duce anything themselves. Piketty wants the world, which cannot sustain a lifestyle Final Act principles. And this was the rea- One can argue that the case of Ukraine those people to pay a tax of 5 to 10 percent they until now considered normal—here son for the EU sanctions involving asset is special and the latest developments in this annually, so that in a matter of a few decades too, the appeal of a tax on capital is big. freezes and travel bans on several individ- country brought the issue of EU-Ukraine their fortune evaporates… In reality, such a tax is difficult to im- uals from Russia. relations to the international agenda. More- Let’s first note that the idea is not new, pose, at least in the current state of affairs. One funny aspect of assets freezing over, these developments directly hit the nor is it Piketty’s invention. Back in 1977, Economically speaking, it is far from sure of selected Russian citizens is that the EU’s interests and future perspectives of its Maurice Allais, the great French thinker that it will effectively address the inequal- decision on this matter by the Euro- Eastern Partnership policy. But still, the is- and economist (whom I had the chance to ity and debt issues. Nor is it really possible pean External Action Service (EEAS), sue of breach of the norms and principles have as a tutor on my post-graduate research to predict the unintended consequences on not only implies ignorance, but it may of international law, especially the violation thesis) had published a book (which was society’s ability to create wealth in the first prove counter-productive. Indeed, one of the unity, integrity and sovereignty of the unfortunately never translated in English) place, or on the eventual flows of capital that and a half years ago, Russia passed a law, states cannot and should not be subject to named L’ impôt sur le Capital, where he ex- may arise. On the other hand, before each which prohibits government officials interpretation. tensively analyzed the concept. Of course, industrial revolution, we witnessed a huge from maintaining assets abroad, so there This is why the issue of a selective ap- being a liberal, his aim was not so much to accumulation of capital, just like now. May- is nothing to freeze. Thus, the entire as- proach by the EU in the application of its se- decrease inequality as to increase economic be, in order to resolve the current issues, it’s sets freezing operation seems to be a curity sanctions seems to be a valid concern efficiency, posting that a reasonable taxa- a better idea to push for the productivity childish attack against specific persons. for other affected partner countries. tion of capital would induce the owners of gains from the coming one, rather than go- In this way, Lady Ashton, for no reason New Europe wealth to become more productive, and ing for the old recipe of more tax. NEWEUROPE 04 www.neweurope.eu INTERVIEW 11-17 May, 2014

We have underestimated what Putin was telling us - interview with Štefan Füle “At the NATO-Russia council summit in Bucharest, Putin told us that Ukraine was an “artificial country”.” By Dan Alexe New Europe has interviewed Štefan Füle, EU Commissioner in charge of Enlarge- ment and Neighbourhood policy, a port- folio that has him in permanent contact with the field of EU foreign policy, cov- ered by the High Representative Cath- erine Ashton. “If you look at the news, that portfolio of High Representative, and also my portfolio, will have a lot to do in the next six months”, said Štefan Füle. “It’s going to make us busy until the last mo- ment.“

New Europe: Why do we need two different jobs, Enlargement and High Representative, to cover what is very often the same field? They frequently overlap.

Štefan Füle: They do not overlap, they actually interact. They are using dif- ferent instruments. I represent the com- munity instruments, the policies such as defined in the treaties… Catherine Ashton coordinates the common security policy. Now, what has has happened in the Štefan Füle makes a point at New Europe Studios past was that the persons in charge of the two jobs were actually pursuing separate New Europe: Catherine Ashton. Štefan Füle: Listen, I know that from tracks. Now, for the first time after the a certain angle it seems almost logical to Lisbon treaty, we are using the same set of Štefan Füle: Oh, come on. I heard say that. But the Eastern Partnership has instruments, and we are somehow mov- her speaking foreign languages. It’s not never been about some zero sum game, it ing in the same direction, interacting with about that, it is not about whether you The Eastern has never been about Moscow and Brus- each other, reinforcing each other. It’s a know two, or three or four languages. It’s sels. It has been about empowering our huge change. about your ability to lead the 28 member Partnership partners to take their own sovereign deci- states in an area where we only now de- sions about their own orientation, about New Europe: You are the first en- fine what’s uniting us, and to coordinate has never been their future, without imposing on them largement Commissioner coming from our national foreign policies. our ambitions, but by helping them to de- an Eastern European country. That about some zero liver on their own ambitions. If their am- means knowing the Russian mentality New Europe: So, you need rather bition is to get closer to the EU — and in and the Russian language, knowing East- administrative qualities. sum game, it the case of some of our Eastern Partners ern Europe. Was that an asset for you? even at a certain time to become member Štefan Füle: You need the qualities of has never been states — then it is our duty, and not only a Štefan Füle: I think it is an advan- a politician, of a good manager, and of an moral one, to help them on that road. tage if one deals simultaneously with the excellent negotiator. about Moscow enlargement portfolio and also with the New Europe: How about Azerbai- neighbourhood portfolio. I think it is New Europe: Let’s get concrete: and Brussels jan? We hear very rarely nowadays about also an advantage to come from a coun- what are the next steps in Moldova and Azerbaijan. You spoke harshly about try which has undergone this huge trans- Georgia? Azerbaijan recently, criticising the situa- formation process called “enlargement”. tion of human rights there. But we don’t To have that experience and to be able to Štefan Füle: The next steps are the hear such criticism about Azerbaijan offer solutions to our partners and candi- very important trips of both governments Štefan Füle: The heads of states and from President Barroso, or from other date members allows you to bring in your to Brussels. President Barroso and the governments have made it absolutely clear Commissioners. By the way, Barroso and personal experience… In other words: college of Commissioners have invited that they want us to create the conditions Oettinger go to Azerbaijan next month, it allowed me to present not only what the prime ministers and the respective for those agreements to be signed before and last time Barroso was there, there was in my mind, but also what was in my members of the governments of the two the end of June… and we will deliver on was no criticism from his side about the heart. So, yes, it helps. countries for discussions. We will start it. The next stage will be to ensure the situation of human rights. Why do you with Moldova on 15 May, then we will conditions of application. We don’t want have two sets of policies in the college of New Europe: Then how come we have Georgia on 21 May. This is actually those agreements to have an effect only in Commissioners? have a Commissioner in charge of ex- only a small part of a very active political one or two years, but as soon as possible. ternal affairs — the High Representa- calendar. Another extremely important Štefan Füle: I will go there as well in tive— who doesn’t speak any foreign event will, of course, be the signing of New Europe: In order to make sure May with my colleague Gunter Oettinger, language? You, for instance, you do the Association agreement with the two that these two countries, Georgia and and I might also accompany President speak Russian and other languages, countries… Moldova, do not fall into Russia’s arms, Barroso. I spoke with the President of and you say this is useful. as it happened with Belarus a long time Azerbaijan two weeks ago, I spoke with New Europe: Which will happen ago, and with Armenia recently, when Azeri ministers ten days ago. There are Štefan Füle: Who doesn’t speak any sometime now in spring, before sum- it decided to join the Customs Union no two policies on Azerbaijan. I agree foreign language? mer. with Russia. with you that it is to the detriment of our NEWEUROPE www.neweurope.eu 05 11-17 May, 2014 INTERVIEW

By Philippe Kotsaridis Economist - Tax Adviser We have underestimated what Putin was telling us - interview with Štefan Füle The Economist‘s lab question. The most challenging job I the consensus of all member states. had in the last two and a half years was It‘s a combination of these two ele- Our policy is how to keep the enlargement alive at ments, so don’t look for geographical a time when the basic instinct of the criteria to define the external borders Regional aid for the to help our whole European Union and of the of the EU. Look for the combination members states was to focus on the of these two elements. economy, the finances and the crisis future of SMEs in the partners to in the Eurozone. There were a num- New Europe: Are you still in fa- ber of ways to do it. We have prob- vour of Turkey’s accession? European Union deliver on their ably chosen the most difficult one: to Ensuring high levels of employment, productivity and strenghten the credibility of the pro- Štefan Füle: I’m in favour of eve- social cohesion in an ever-changing world will require own ambitions cess. In the last two and a half years, ry European country that knocks on the European Union to become a smart, sustainable and we went from a box-ticking exercise to our door, wanting to share our values innovative economy. Of course, this is the desired ideal. a project of political transformation. and to become a member of our club, You should know that the European Union now has partnership with Azerbaijan that we Track record matters, and I am very and sharing the same rules to be given over 20 million small and medium sized enterprises do not talk more about the country. happy to see the first small results. the chance to become a part of that. (SMEs), which combined represent a whopping 99% This I say objectively. The point here of European companies. SMEs are a key driver of eco- is that the Eastern Partnership is not a New Europe: How about Alba- New Europe: One final topic. nomic growth, innovation, employment and social in- straight jacket that we have put on our nia? Why is it kept at arms length? How could Europe be so wrong tegration. The European Commission is eager to help Eastern partners in order to suit one, in the case of Ukraine and of Rus- entrepreneurs succeed by improving the environment or a small group of them. Štefan Füle: That’s a good ques- sia’s intentions? I’m thing of the in which SMEs operate to enable them to develop their No, it’s a framework, and a set of tion. Whatever you do, at the end of way in which in Vilnius unexpect- full potential in an economic sphere that is now global policies based on certain principles. the day, it‘s up to the local politicians edly Yanukovych refused to sign and hyper-competitive. We apply them to all pour partners, of any country to use the chance the Agreement, after which things What practical help can the EU offer? with Belarus on one side, and Mol- given to them and to deliver on the went so fast that everybody was The European Commission is interested in the welfare dova and Georgia on another side, expectations. Unfortunately, in Al- taken by surprise. of everything that touches and affects entrepreneurship but also to Azerbaijan. Azerbaijan has bania, in the past, when there were and SMEs throughout Europe. It deals with support to find its place in forging its relations elections — I’m not talking about Štefan Füle: I don’t agree, I don’t mechanisms for SMEs. It works both for the established with the EU. Is Azerbaijan our strate- the recent parliamentary elections—, think we were wrong in the case of entrepreneurs, as well as the budding entrepreneur with gic partner in energy? Yes, it is!… Are it happened often to have not one, Ukraine. As I said, our Eastern Part- a start-up, paying special attention to women entrepre- we ready to expand this strategical but two winners, and it usually took nership is not about our ambition neurs, for example, and to handicrafts and companies in importance or dimension to other ar- some time for these winners to figure to impose anything on our partners. the social economy. eas? We are, on the condition that one out who had to be in charge. They Our policy is to help our partners to All actions in favour of SMEs and entrepreneurship are of those areas be the area of human would not join their forces when it deliver on their own ambitions, and grouped within a single framework called the Small Busi- rights and fundamental freedoms. came to the European agenda. I hope this is what we have been doing in ness Act for Europe (or SBA for short), under which all now that all the time we’ve lost in Ukraine from the very beginning. We EU member states are committed to work alongside the New Europe: Then why isn’t the past is over. I see Albania getting have been trying to interact with the European Commission. Armenia never criticised? After closer and closer to the decision of Russians, to have them understand The SMEs need strategic and financial support at the lo- all, Armenia still occupies part of the member states on granting it the that this is a win-win solution, and cal level. This is why the Commission also works to help Azerbaijan’s territory and is now candidate status. Our recommenda- that this Association agreement of the member states and regions to develop policies to pro- joining the Customs Union with tion will go in the positive direction. I ours is to the advantage not only of mote entrepreneurship, improve the situation of SMEs Russia. We only hear criticism hope the member states will find that our neighbours, but also to the neigh- throughout their lifecycle and help them to access new about Azerbaijan, and not about our arguments are strong. bours of our neighbours. But we have markets. Armenia. probably underestimated what Presi- The ultimate goal of state regional aid is to support Štefan Füle: We are not criticis- New Europe: Will it happen dent Putin was trying to tell us already economic development and employment. The guide- ing countries for the choices they this year? many years ago, when he said that the lines contain rules allowing the member states to draw make. Our task is to empower each biggest catastrophe of the XXth cen- up maps of regional aid valid for the period 2014-2020. country to make sovereign choices, Štefan Füle: It should happen tury was the dissolution of the Soviet These maps mark the geographical areas and show the not to criticise them for their sover- this June, during the European Union. Secondly, in 2008, at the NA- extent that each member states can support new invest- eign choices. When we are looking Council. TO-Russia council summit in Bucha- ments made by SMEs and set aid ceilings for companies at how those countries are imple- rest, when he said that Ukraine was an in these eligible regions. These maps will come into ef- menting the commitments they have New Europe: This is already a “artificial country”. It’s very sad for me, fect in July until the end of 2020. undertaken — we have jointly estab- scoop. at the end of my term, to see that our On the one hand, Brussels is easing controls and fa- lished the Eastern Partnership—, am policy has met such a resistance. I am cilitating the procedures for obtaining funds of smaller I happy that I am called so many times Štefan Füle: It will be up to the very concerned to see this policy of amounts. Larger projects will continue to be closely to pay attention to this or that breach member states. “manageable chaos” being introduced monitored. of human rights in Azerbaijan? No, I in Ukraine. Where exactly are the lim- If the priority of this strategy is to accelerate the end of am not happy. New Europe: But when will the its of “ managable”? To what extent the crisis, it also aims to lay the foundations for sustain- enlargement stop? Where are the can one “manage” chaos? I would hate able growth. New Europe: The Balkans, borders of Europe? How far can the to see anyone playing games with the This strategy sets objectives in the following key ar- now. You have been very active in enlargement go? purpose of determining who is going eas: employment, research and development, climate the Balkans. We’ve seen Serbia be- to pay the biggest price for Ukraine: change and environment, education, poverty and social coming a success story - they have Štefan Füle: It can continue as Moscow or Brussels? We are not into exclusion. started negotiation with Kosovo; long as there will be a point where ar- that kind of game. However, in practice, access to regional aid is not always then, we have Montenegro. How ticle 49of the Lisbon treaty will meet obvious. This is why it is important to ensure that this did you manage to achieve such a the consensus of the member states. New Europe: So we basically information is widely disseminated. result, given that it had been drag- Article 49 speaks about what a Euro- misunderstood Putin’s personality. View the map of your area online ging on for years? pean country is, it sets out the condi- (http://ec.europa.eu/regional_policy/index_en.cfm). tions for becoming an EU member. Štefan Füle: We have to learn Štefan Füle: Thank you for this For accepting any country, one needs from this. [email protected] NEWEUROPE 06 www.neweurope.eu ANALYSIS 11-17 May, 2014

Exclusive “Euro introduction: a journey of over a decade” By Ilmars Rimsevics Governor of the Latvia profile Bank of Latvia By New Europe One of the three Baltic Republics, Latvia gained its independence in 1991 after 51 years of Soviet rule. Latvia has a unique language and culture that it has managed 1 January 2014 was one of the most impor- to preserve, despite the fact that the coun- tant dates in Latvia’s history since the resto- try was under foreign occupation between ration of independence in the early 1990s. the 13th and the 20th Centuries. By the On that day, we finished a journey of more end of the First World War, the wave of than a decade to full membership in the Eu- independence that swept over European ropean Monetary Union. nations allowed this Baltic state to become This journey was full of challenges, yet independent. This was in 1920. Two dec- Latvia never doubted its choice, even dur- ades later, the Nazi-Soviet pact between ing the period of economic hardship for the Adolf Hitler and Joseph Stalin allowed So- viet troops to invade (in 1940) the Baltic euro area. States, including Latvia. Occupied by Nazi Latvia’s original goal, upon joining the Germany between 1941 and 1944, Latvia European Union, was to introduce the euro saw the return of the Soviets in 1944 at on 1 January 2008, yet this resolve came to which time the country became part of the nothing because of the overly high inflation then USSR. Latvia, which was tradition- in the overheating economy. ally an agricultural country, experienced After a deep economic crisis began in Latvia and its capital, Riga are glad to be in the Euro. EPA/UWE ZUCCHI. a rapid industrialisation during the Soviet late 2008, euro introduction re-entered the era largely due to its unique geopolitical political agenda, this time as a precondition Ministry of the Republic of Latvia, the Eu- any delays. position. Latvia borders Lithuania and to economic stabilization. Now, looking ropean Central Bank (ECB), the European Over the last year, the infrastructure of Estonia, both members of the European back at the turbulent events of 2008 and Commission and euro area central banks as the Latvian payment systems was prepared Union, and Russia and Belarus. After gain- 2009, we can conclude that if Latvia had well as to our colleagues at Latvijas Banka. for the euro introduction. One of the most ing independence, Latvia’s development succeeded in introducing the euro in 2008, As late as the autumn of 2012, the at- significant novelties was the realization of was rapid and the country was orientated its economic difficulty would have been titude of the Latvian public to the euro the Single Euro Payments Area (SEPA) towards a market economy. In 2004, Latvia much less serious. changeover was very cautious, garnering project, which allows the residents and became a member of the EU and NATO. Latvia took painful yet necessary meas- support of only 26% of the population. businesses of Latvia to make more con- After regaining independence in 1991, ures to ensure recovery and organization of As a result of carefully explaining the eco- venient, cheaper and faster payments in Latvia’s economy experienced tremen- the economy, which allowed it to resume nomic aspects of the euro introduction and the common European currency. We must dous growth. Between 2004 and 2007, the economic growth, moreover changing the ensuring a smooth changeover process, so- keep in mind that Latvijas Banka interbank economy grew by as much as 50%. Latvia structure of the economy, with exports ciological surveys at the beginning of 2014 automated payment system was prepared was nominated a ‘Baltic tiger’ together with gaining a much greater significance. In a point to a support by 50%, a percentage that for the euro introduction several years ago its two neighbouring countries. The global short period of time, we managed to put for the first time exceeds the number of the which made the transition process of the financial crisis of 2008 also hit Latvia. The our budget policies in order, to carry out negatively inclined. entire Latvian financial system much easier. country is now struggling to overcome one several structural reforms, including in state The organizations involved in euro in- Joining the Eurosystem brings changes of the worst recessions reported among the administration and improving the business troduction have succeeded in making sure to almost all areas of work of Latvijas Banka. EU member states. The crisis has stirred environment. that the absolute majority of the population They are most pronounced in the analysis social unrest that led to the overthrowing We take pride in our success, albeit there feel adequately informed about the design of macroeconomic developments, so that of the Ivars Godmanis government in Feb- are of course many tasks ahead of us, par- and safety features of the euro banknotes the central bank of Latvia could participate ruary 2009. A year later, the rate of unem- ticularly with regard to reforms: in the edu- and coins. Moreover, they feel that the tran- in the monetary policy decision making in ployment reached 20%. The Vladis Dom- brovskis government that followed turned cation sector, state administration, further sition process was convenient in the areas of the capacity of an equal partner. The focus to the EU and to International Monetary fostering of economic competitiveness. both cash and noncash currency. of the economic analysis of Latvijas Banka Fund (IMF) for help. Latvia secured an Latvia’s experience in overcoming the To ensure a smooth transition to the has broadened substantially: from Latvia to IMF/EU €7.5bn bailout. Harsh auster- crisis served not only as a good lesson to euro, the entire year 2013 was spent by Lat- the entire euro area. ity measures were implemented, including ourselves but also as an example for the vijas Banka, doing preparatory work: the The beautiful coins of Latvia are famil- deep cuts in public spending. Despite their euro area and European Union at large as legal framework was set up and skills per- iar throughout the world; we have not only unpopularity, the measures implemented well as for individual countries. The chal- fected for performing tasks related to the received praise from coin collectors but also by government helped Latvia’s economy lenges which Latvia faced just recently are participation in the Eurosystem. got a number of prestigious international to recover. By 2011, the country was once topical at the all-European level; and chief To provide the Latvian economy with prizes. The euro has not put an end to Lat- again on the road to economic growth. among them is prudent management and the necessary money supply after the euro via’s contribution to the coin art, on the con- Before the end of 2012, the economy ex- budget policies. changeover, several important measures trary: in the future as well, people all over perienced the strongest recovery in the With regard to Latvia’s practical experi- were taken. On the order of Latvijas Banka, the world will be introduced to our beautiful EU. Latvia joined the eurozone at the be- ence with the euro introduction, we must 400 million Latvian euro coins were struck money; and the interest is already great. ginning of this year even though a consist- say that the changeover to the single Eu- in Germany and 110.3 million euro bank- The same can be said about the overall ent segment of the population was not in ropean currency both in the circulation of notes were borrowed from the Eurosystem. work of Latvijas Banka. Ensuring the best favour of adopting the single currency and cash currency and in noncash payments as In November 2013, the distribution of euro solutions for the most important and com- the rate of unemployment remains high. well as in informing the public took place banknotes and coins was launched to credit plicated task, the successful participation In two articles featured exclusively in New smoothly and calmly. Various surveys in- institutions so that they could supply busi- of the Latvian economy in the euro area, Europe, the finance minister of Latvia and dicate that the Latvian public consider the nesses; on 10 December, the euro starter has begun. We will need much strength the country’s central bank governor explain changeover process as convenient and easy kits went on sale for the general public. The and energy to take part in the development how their country prepared to join the Eu- to understand in all main aspects. For this, tense work, preparing the circulation of of Latvia and the euro area, and I am con- rozone. They also provide rare insight into I would like to express my thanks to our cash euro, allowed the actual introduction vinced that we will be successful in all our what the introduction of the single cur- partners in the Government, the Finance process to take place smoothly and without undertakings. rency means for their country’s economy. NEWEUROPE www.neweurope.eu 07 11-17 May, 2014 ANALYSIS

Exclusive Latvia’s experience in the euro changeover By Andris Vilks Minister of Finance of Latvia

ith the euro successfully in- troduced in Latvia, the num- ber of European Union coun- triesW using the single European currency has increased to 18, thereby raising the number of Europeans sharing the single European currency to some 333 million people. The adoption of the euro has been a long-standing and significant objective of Latvia since Latvia has joined the Euro- pean Union. Alongside NATO and Euro- pean Union integration, euro implemen- tation in Latvia is one more step for our country to permanently become an essen- tial part of the European political and eco- nomic system. In joining the Eurozone, Latvia further solidifies its integration in the Euro Atlantic community, as well as cooperation with the EU countries and the US. This means not only economic, but also political and military security for Latvia. Latvia’s Prime Minister Laimdota Straujuma arrives on the second day of the EU summit of heads of state and government, at the EU headquarters We see the euro and closer integra- in Brussels BELGA PHOTO THIERRY ROGE tion in the European Union as an anchor for sustained macroeconomic stability Planning were achieved. During the years of plan- to reduce the impact of the changeover and long-term development of Latvia’s The euro introduction project has been ning, there was numerous experiences learnt process to the part of society with limited economy. It is important to recognise that one of the most carefully planned events in and the closest one in timing and space was access to financial services, for example, the euro introduction is an additional tool the history of Latvia. that of our Estonian neighbours. The idea people living in remote areas. to enhance competitiveness, to facilitate The preparations for the changeover of professional expert grouping, workshops The changeover night from the lats to international trade, to enrich Latvia’s em- started almost 10 years ago, right after the and guidelines, as well as close supervision the euro was smooth and successful. Dur- ployment market and improve investment European Union membership referendum of IT system changeover was successfully ing the first two weeks of January, Latvi- flow by attracting investments. At the and accession to the European Union. The undertaken by Estonian colleagues and de- ans still were paying in lats and already in same time, Latvia’s inhabitants received preparations for the adoption of the euro veloped further to also help our Lithuanian the euro, but change was given only in the immediate benefits as the elimination of were led by the Government of the Republic neighbours who are approaching the euro euro. Cashless means of payment was the currency devaluation opportunity, the of Latvia and the Bank of Latvia. The Steer- area next year. most convenient for the currency change- elimination of the costs of currency risks ing committee, the responsible body for the Thanks to the careful preparations made over. For Latvians, it was very important insurance, the elimination of currency ex- euro introduction planning and changeover in close contact with the European Com- to know that cash changeover is without change costs, the reduction of transaction implementation and five working groups mission and the European Central Bank, the time limitation. Despite of fact that at costs etc. Latvia’s consumer now has the launched their work in 2005 and Latvia’s Na- technical transition was very smooth and banks and post offices the changeover is tool to compare prices and the price trans- tional euro changeover plan has been adopt- successful. No major problems were encoun- going to end already in 2014, inhabitants parency is stipulating competitiveness of ed in its first edition already as early as 2006 tered and banks, Latvian post offices and re- are well aware that the Bank of Latvia will our economy as well. and carefully implemented by the public, tailers coped well and in time with the extra exchange the lats to the euro forever by Keeping the country finances at the private and NGO sectors during 2012 and workload. The smooth changeover can only applying the same fixed exchange rate. Maastricht criteria boundaries is the same 2013. On 5 June 2013, the European Central be attributed to the extensive efforts made By ending the practical part of the as also keeping the country on a healthy Bank and the European Commission pub- by banking sector experts, IT systems con- project there were at least two impor- economy track. The criteria were impor- lished their Convergence Report, confirm- figuration experts, security companies and tant competences obtained from the tant for us as in the period of convergence ing that Latvia had fulfilled all the criteria countless Latvian companies, organisations changeover process. Firstly, the experts and fiscal prudence remains important for the adoption of the euro. A month later and inhabitants. from public, private and NGO sectors also after the euro introduction – at the – on 9 July 2013 – Latvia received the final The smooth, safe and convenient understood that it was very important to national level, as well as in each family approval of the EU Economic and Financial changeover to the euro may be considered cooperate and to keep open dialog, de- context. The fulfilment of the criteria was Affairs Council for the adoption of the euro the greatest reward for the efforts of all in- spite the problems might be not easiest related also to the better credit ratings for on 1 January 2014. This was a historical date volved. to solve quickly. Open dialog and knowl- Latvia. As the mid-term consequence it for Latvia that also brought the irrevocably edge-sharing was the key instrument at meant also better conditions for Latvia’s fixed rate from lats to euro, allaying fears of any level of the project. Secondly, ex- debt management and additional input any potential devaluations. Cooperation during euro perts gained self-confidence. for the state budget. Similar to other euro area countries the introduction process Latvia’s professionals are able to keep I feel confident that Latvia will con- most important tasks for Latvia’s euro intro- The project’s technical success was complicated processes supervised and tinue the dynamic and sustainable growth duction project were related to the smooth based on the knowledge-sharing princi- smoothly and in time implemented. Lat- ahead and as member of Eurozone, Latvia cash changeover and proper communication ple. Particularly, we may highlight follow- via’s inhabitants, by gaining a new experi- will play an active part in policymaking to for all the inhabitants of Latvia. By keeping ing practical issues – the risk management ence and one of the most beautiful euro further strengthen European integration the euro changeover simple, safe and conven- process for the most critical changeover coins, have also raised their support to the and in determining its future. ient for each Latvian inhabitant, both goals period and regional changeover mapping single European currency. NEWEUROPE 08 www.neweurope.eu ANALYSIS 11-17 May, 2014

A member of New Europe’s Knowledge Network By Francisco Jaime Quesado Return to ‘Social Europe’ Schulz promises change as Commission President

WeThe live in a different Economy world. A global world is back!of complexity, uncertainty, stronger competition and high standards of quality and innovation demanding. The economy is con- fronted with new challenges and the art of the economy is the right answer to the different questions that society define. The art of the economy is the new state of the art of a more creative matrix of concrete proposals to the chal- lenges that are brought every day to society by people and organizations. The art of the economy must be supported by the most modern standards of innovation, creativity and competitiveness. This is the reason to believe that a new standard of global economy, more than a possibility, is an individual and collective necessity for all of us, effec- tive global citizens. The difference of this new economy in this new world will be in the exercise of the capacity of the individual participation as the central contribution to the reinvention of the collective society. The art of the economy is not determined by law. It is effec- tively constructed by all the actors in a free and collabora- tive strategic interaction. The acceleration of the economy depends largely on its people and institutions. An active commitment, in which the focus in the participation and Martin Schulz, President of the European Parliament addresses a rally in Dortmund, western Germany AFP PHOTO / PATRIK STOLLARZ development of new competences, on a collaborative ba- sis, must be the key of the difference. This is purpose of the said that, contrary to what he hears growth, education and training. Diplomacy of the Economy. By Andy Carling from his opponents, “The crisis is not Aware that Germany has taken The art of the economy must also be developed by a per- artin Schulz, the centre- over”. He added that “The crisis is over centre-stage, Schulz defended the manent flow of ideas. Ideas demand a permanent colabo- left candidate for the com- when 27 million unemployed Europe- centre-right German Chancellor by ration between the different actors, with the strategic chal- mission presidency un- ans get jobs.” saying decisions are not taken by Mer- lenge of reinforcing the central competences of society and Mveiled his policies and objectives for He said it was also about the qual- kel but by all heads of state, either by qualifying them as the unique ways of creation of value Europe, should he find himself the ity of employment, saying he wanted majority or universal agreement. and modernity. The markets are facing also a unique op- winner of the European elections. “not continual training schemes or Saying that the Euro was “strong” portunity. The ideas must be the difference of a proposal Describing the EU as “too bu- zero hours contracts.” Schulz said he would work to ensure we must be aware that is the best key for our ambition of reaucratic, too undemocratic and too The digital agenda was a key part that taxpayers weren’t left paying for excellence. The art of the economy demands also a com- unsocial,” Schulz argued strongly for of his hopes. Schulz said it offered the failures of the financial system. mitment of partnership in order to build a real Strategy of a Europe of pan-national politics, a tremendous opportunities, but he But he did promise to be a com- Confidence in the implementation of the different policies. strong economy and jobs for the mil- pledged to protect private data, espe- mission for all members and would The focus on Innovation and Knowledge as the drivers of lions of unemployed youth. cially in the negotiations over a EU- defend their common interest, rather creating added value with international dissemination is a He also took aim at the European US trade deal, one of the key tasks of than the most powerful or vocal. unique challenge that may be the answer to a new way of Council. the next five years. However, not all was well as he interaction between those who have the responsibility of Aware of speculation that ‘com- He also wanted equal wages, not- admitted “I will not go to the UK to thinking and those that have the responsibility of produc- promise candidates’ are preparing ing that he had a son and a daughter, campaign.” Sources say that this was ing goods and services. The art of the economy demands themselves and rumour is suggesting he said that his daughter would earn because he hadn’t been invited to the also a new competitive attitude. We need people to have a the idea of a ‘grand coalition’ against 15% less than his son, on average. country by the UK Labour party, one new challenge. Society must be able to be the real Platform extremists and Eurosceptics, whose “Why is my daughter less than my of the largest sections of the Socialist of a more entrepreneurial attitude, centered in new areas parties may get nearly a third of the son?” he asked. On the same theme and Democrats Group in the Euro- of knowledge and new sectors of value. In a Modern and vote, Schulz said that they had to he said he wanted a gender balanced pean Parliament and they kept away Active Society, the key word is Co-creation. To promote choose the candidate with the most commission. out of respect for their comrades. a dynamic and active creation process involving each citi- votes, saying picking another “be- He said that a minimum tax rate There was little talk of structural zen is the big challenge for the next years in the future. The hind closed doors” would provide was an objective of his, as a way of changes or of any overhaul of Brus- future is the right place to say we are in, we want to be in, ammunition for the eurosceptics, lessening tax evasion. He also offered sels and its institutions, neither was we want to be the right solution to the global problems we who would say it demonstrated the a simple and clear approach to cor- the awkward question of the par- face. The art of the economy must be a confidence in Ex- EU’s distain for democracy. porate tax in a multinational environ- liament having three seats and the cellence. Excelence must be the new competitive advan- Schulz said that he wanted to ment. “You pay tax where you make promised changes amounted to a re- tage of a new society of the Ideas pushed by the “enablers” “deepen democratic structures” and your profits.” turn to the idea of ‘social Europe’ and of Modernity, Added Value and Excellence. A very clear that regaining trust was the prime Promising a ‘progressive’ com- different policies. idea that suits the big challenge that our society really faces purpose. mission, Schulz said that all initiatives Is it the change the EU needs to and that requires new answers for different questions. The Turning to unemployment, Schulz should meet principles to improve remain alive and relevant? act of global participation in such a demanding society is an exercise of commitment between the individual crea- ADVERTISEMENT tivity and the collective cooperation.

Francisco Jaime Quesado is the General Manager of the Innovation and Knowledge Society in Portugal, a public agency with the mission of coordinating the policies for Information Society and mobilizing it through dissemination, qualification and research activities. It operates within the Ministry of Science, Technology and Higher Education NEWEUROPE www.neweurope.eu 09 11-17 May, 2014 ANALYSIS

A bold agenda for By Andy Carling Constructive Ambiguity

Bythe Gianni Pittella next Parliament Farewell puny humans Vice-President of the Just how close to self-extinction is humanity? This is European Parliament a question that is concerning leading scientists and thinkers. Sure the climate is looking dodgier than a third-hand Lada and there’s always the chance that we might get microwaved into another dimension by a gamma ray, but what is really worrying is just how ea- he next European elections gerly humanity is to stick its head in the over, open the will be decisive for the future gas and light up one final cigarette. of the European Parliament. This can be deduced by going through the tsunami TFor the first time since its election by of nonsense emailed by the various PR companies direct universal suffrage, the internal and other succubi of sanity that seem to gravitate to balance of political forces may be Brussels. substantially changed by the rise of This is how I learned that 17% of Britons would have populist and eurosceptic parties. sex with a robot. God alone knows what the percentage It is therefore essential to rally is in Italy, but basically one in five were ready to sing the all pro-European political forces in body electric. Gone are the days when Albion covered this campaign. We should not take table legs, lest they provoke lust. a defensive approach and demonize Nowadays, they’ll drop their pants at anything vaguely the Eurosceptic and populist politi- People walk past a cardboard character of Martin Schulz, 0n May 8, 2014 in mechanical. The survey wasn’t specific, so we can as- Stuttgart, southern Germany. AFP PHOTO / DPA / SEBASTIAN KAHNERT cal parties. I believe that it is time to sume that a percentage of the population is, right now, challenge populists by opposing looking excitedly at a range of kitchen appliances and them an ambitious agenda for Eu- phase, beginning in 2014. An open flexible and less dogmatic approach. thinking “I wonder…” rope. The debate on the future of debate about the future of Europe This is also the position of many One should also be cautious around any Brit who has a Europe should not be limited to a is the most powerful weapon at our European governments such as Ita- car with darkened windows and a sat-nav system. referendum for or against the Euro. disposal to challenge Eurosceptic ly and France. In the next mandate The disturbing thing is that is research is going ahead In this context we have to work out parties: When discussing of Eu- there will be a unique opportunity in this sordid field. So far there is a demo, using the an ambitious but realistic agenda for robonds, it will be interesting to see to reform the Stability Pact: the Oculus Rift headset, a, oh shall we say ‘wearable’ device the new term from now. This agenda the position taken by the Five Star implementation of the six pack and which allows the participant to have an erotic encoun- should be built on three fundamen- Movement which, unlike Geert Wil- two pack will be assessed by the Eu- ter with an amine character. tal issues. ders’ party in the Netherlands or the ropean Commission and the new Yes. We’ve invented a way for nerds to have sex with a First, we have to build a politi- Front National in France has always European Parliament may, in this cartoon 12 year old girl. cal Europe through: a bold political supported the introduction of Euro- context, call on the Commission to On a different theme, I’m alerted to a report from initiative encompassing the revision pean bonds. It will turn out that the propose a comprehensive revision some worthy folk, concerned over killer robots getting of the treaties. The experience of new coalition of Europhobic parties of the fiscal rules. involved in policing. Apparently we should ban them the Convention which drafted the is not as monolithic as it is presented. The third priority is Social Eu- before they’re invented. The argument goes something Constitutional Treaty rejected in The launch of a constituent pro- rope. The crisis and its long after- like this. If we invent killer robots they might possibly 2005 demonstrated that a too com- cess may also be an opportunity to math have made it clearer than ever be prone to not being quite right in every situation. plicated and fuzzy procedure will better define the role of the UK in that a Europe reduced to economic Another view is that a bunch of people with nothing fail. We need simple and clear proce- the European Union. The British ref- issues will lose the trust of citizens. I better at all to do, decided to invent a fake scare in order dures. Thanks to the Lisbon Treaty, erendum scheduled for 2017 will be want to see an EU true to the princi- to get attention and cash for their fantasy think tank. the European Parliament can trigger a moment of truth for the European ples of the European treaties, where Or they got really, really stoned while watching the a full review of treaties. The Parlia- project and we can not remain pas- the goals are full employment, social 1973 sci-fi classic ‘Westworld.’ Yul Brynner was in that ment to be elected on May the 25th sive in front of the difficulties that equality and ending poverty. For film, playing a killer robot and he’s dead, so that is a may therefore establish a constitu- the EU will face in case of a UK exit. these reasons, in the next term we clear warning of something. ent assembly representing European It is necessary to convince Lon- have to introduce a common unem- Elsewhere a lobbyist emails me to say that if children citizens to prepare a draft European don to stay within the European pro- ployment benefit for the EU work- look at a screen for more than two hours a day they’ll Constitution which will be submit- ject. In the last years mutual distrust ers. This will play a central counter- die of high blood pressure. Apart from being obvious ted to a plenary vote in Parliament. empoisoned the relations between cyclical role. hogwash, as if it were in any way true humanity in the It will be a simple, transparent and London and Brussels and everything Around these major issues, the western world would have died out a generation or two fully legitimate way to proceed with must be done to pave the way for a political Europe and the redefini- ago. the reform of the European institu- reconciliation. The commitment tion of the economic policy, we will But, it really does show what an apathetic bunch today’s tions. All political groups, even Eu- and quality of work provided by be able to get the European process toddlers are. When I watch the news or talk shows by rosceptic parties if they wish, will Labour Members in the European back on track and challenge the Eu- blood pressure is through the roof in seconds. be involved in this work. In addi- Parliament, for example, shows the rosceptic and populist parties test- Actually, the study quoted says that kids should have tion, to initiate this new constituent importance of the United Kingdom’s ing their cohesion and real commit- at least an hour of vigorous activity a day. I suggest we phase, the support of the Member contribution to the European Union ment to undermining the European reinstate child chimney sweeps. Give them a sense of States is not necessary. In case of op- in its everyday life. A UK exit would project. The main enemy of Europe purpose. position from the member States, have negative effects not only for the today is not just populism but it is These surveys invariably back up the current market- the Parliament desperately need UK but also Europe as a whole. mainly the lack of boldness of Eu- ing aim of the organisation that commissioned them. to follow Jacques Delors’ and Hel- A more ambitious European ropean leaders. The next European In this case they did it, as revealed by a careful reading mut Schmidt’s provocative advice agenda should also aim at improv- Parliament has the duty to propose of the small print, by finding unhealthy, obese kids and and initiate a “parliamentary coup”. ing the economic governance. The a bold action plan. This may be the stuffing them with junk food. This is not optimal it Only a strong European Parliament stability pact has been overtaken last chance to save the European seems. will be able to enforce a constituent by events and now we need a more project. So, there’s a day in the life of my inbox. NEWEUROPE 10 www.neweurope.eu ANALYSIS 11-17 May, 2014

By Dan Alexe Hubris and the city Don’t get lost in translation When ‘Getting It Right’ really means ‘Getting It Right’ José Manuel Barroso,

In histhe Maoist chatterbox youth, José Manuel Barroso grandee should have read Lao Tzu, who taught paucity of words as a virtue. No need to bother with Wittgenstein, a simple Chinese aphorism is enough to learn that keeping silent when you have nothing to say is a major quality. With money and power coming his way, hubris stroke and Barroso became today’s bureaucratic mill of empty politi- cal vocables, churning out string upon string of gongoric words, while seeing himself as one of the grandees of the world. One would be hard put to find one single memorable sen- tence in any of the countless discourses and speeches he held during the decade in which he’s been twice imposed by the capitals at the helm of the Commission in order to turn the institution into a subservient, downtrodden, and servile political tool. His recent speech “Considerations on the present and the future of the European Union” delivered on 8 May at Hum- boldt University in Berlin is a disaster in rhetorics and hu- man communication. A void discourse always hides an empty policy. Never has There’s a subtle difference between ‘this is mine’ and ‘this is a mine’. AFP PHOTO / FREDERICK FLORIN Europe been weaker than under Barroso. There was a time when the President of the Commission had vision and cha- lots of confusion, creating uninvited Risk = probability of something risma. It is easy today to sneer at such names as Jacques By Jonathan Jewell MSc – and mostly unwelcome – work going wrong x how bad it would be Delors, but the Commission President was then the peer he expression ‘lost in trans- for potentially thousands of people. if it did go wrong of the heads of states and governments. Barroso also wants lation’ seems to have lost Sometimes, if we can find enough Without getting into detail of how to be the peer of the powerful of the day, and he sees him- some of its gravity of late. time and money, we can fix - or at these different parts can be measured self as a grandee. One has only to see him shivering with TEmbarrassing predictive text ‘fails’ least salvage – some of it. The Press (and there is substantial research and pleasure whenever he is called “Mr President”, although he shared on Facebook, badly worded does not leave to the imagination a wide range of tools available to do always does it with a bent spine. customer service department let- the dangers that sub-standard com- so), the level of the risk score is what He was put where he is in order to stifle any initiative, and ters - even a Hollywood block- munication can have in medical or we are trying to ‘manage’. Essentially any idea of initiative. The atmosphere around him became buster by the same name… ’Lost in engineering settings; they report it the answer is to invest as much (or, a feudal one, of opaqueness and mistrust. He introduced a translation’ can seem a quaint and daily. But even for something less more often, as little) time, money and climate of fear in the Commission. Officials would ask for friendly thing, something fun and bloody - a career in politics or the effort in keeping the ‘risk’ figure at their names not to be disclosed whenever talking about the humorous. Many of us can recount civil service - the damage may be a level that you are willing to accept internal functioning of the institution, or about the pyra- amusing stories about words or ex- irreparable. Whether it is for the (your appetite for risk). Most organi- mid of power. pressions that got ‘lost in transla- interests of others or for ourselves, sations have a system for managing tion’. The British ‘rubber’ - a tool for it is incumbent on all of us to make risk, from detailed portfolio analy- He became the “Conservative” par excellence, bringing in removing pencil marks from paper sure the right things are said - and ses, to the more common and intui- the Commission an obsession with market and competi- (an ‘eraser’); the American ‘rubber’ said right. tive ‘Now I wouldn’t do that if I were tion. He had no humane words for the hardship endured – a male contraceptive device (a Success in translation and in- you…’ approach. The ‘equation’ for by the plebeians of the bankrupt countries from the South, ‘condom’). terpreting is quite difficult to know translation and interpretation is, and fearing one might remember that he himself hails from If the worst case scenario was a how to measure. It can be a bit like appears to obey the same laws as for there. He also never credibly mentioned human rights good laugh at a Brit’s expense, per- the number of IT failures that didn’t its IT and medical counterparts. Cut whenever meeting any of the Central Asian dictators, the haps the European Union would happen, or number of medical er- the investment in managing the risk, likes of the Turkmen or Uzbek dictators. not think or worry too hard about rors that didn’t happen: most of and the probability of something go- Dictatorial himself, in 2012 he fired a Commissioner making sure we didn’t ‘lose’ things the time it goes well, and we do not ing wrong rises, and whatever it is that (John Dallí, Health and Consumer Policy) without giv- as we went along. However, when think twice about it. But on the hun- goes wrong being much worse than it ing him the possibility of defending his case. He accused we think of the potential for things dredth, or thousandth, or millionth could be, rises. Dallí of connivence with the tobacco lobby (a charge still going wrong (even two established of time when it fails, we notice. At Jerge Zilinskiene, of Today not proven), but Barroso’s own secretary general, Cathrine dialects of English), Europe with its that point, it is often too late to do Translations, says… Day, held during that year a great number of secret meet- 230 languages and a potentially in- anything but damage limitation. It is abundantly clear that our ings with tobacco lobby representatives. calculable number of dialects, starts We use words like ‘potential’ and appetite for translation risk is far to look like a minefield for linguistic ‘potentially’ give a sense that we greater than that for IT or medicine. He is now obsessed with finding a job equivalent to the calamity. acknowledge that something could But if the pen truly is mightier than one he will be forced to leave at the end of the year. He As professionals, practition- go wrong, but actually, we do not the sword, the last thing that politi- tried, clumsily (he is actually not very skilled at this), to ers, policy-makers and politicians, know what, when, where, how, or cians and civil servants need is to hint at some interest for NATO. It is rumoured that he we are sage enough to know that maybe even why it has gone wrong. do is to fall on their pens, by taking dreams of the UN. Why would he deserve another high, careful communication is most For IT and medicine, the immediate shortcuts. powerful and extremely well-paid job? Simply because he certainly not a trivial matter. Even answer is to turn to the risk manage- already held one. He would explain this to you in unbear- relatively small mistakes in a diplo- ment department. Risk managers Jonathan Jewell MSc ably dull and empty sentences, string upon string of words matic draft, a political manifesto or use a simple but useful equation to Faculty of Social Sciences like “coherence”, “pragmatism”, “resilience”... internal communications can cause try and quantify the risk: The Open University NEWEUROPE www.neweurope.eu 11 11-17 May, 2014 ANALYSIS

A member of New Europe’s Knowledge Network

By Greg Austin EastWest Russia issues report on human Institute rights violations in Ukraine A Call to Europe’s Accuses ultranationalist, neo-Nazi, and extremist forces of gross violations ties and the lack of punishment for Foreign Ministers By Andy Carling those involved, the report concludes, If the situation in Ukraine presents the worst security crisis ussia is taking the new “The perpetrators must be duly pun- in Europe for three decades and if it has deteriorated serious- Ukrainian government to ished. Otherwise, extremists of all ly in recent weeks, then the 28 foreign ministers due to meet task by using a peaceful stripes and colors will receive a dan- on 13 May need to have a plan that matches the seriousness Rmethod – issuing a report. gerous signal of encouragement.” of the threat. The meeting will officially mark the tenth an- The ‘White Book on Violations Covering the period between niversary of the decision in 2004 to admit ten new member of Human Rights and the Rule of November 2013 and March 2014, states to the European Union (EU). Law in Ukraine’ recently issued by the report says it is based on facts by Russia’s bottom line is an end to further EU expansion. It ap- the Ministry of Foreign Affairs of media and internet monitoring, eye- pears to want the Eurasian Economic Union (to be formally the Russian Federation blames the witness accounts and the assistance established by 2015) as the future for all former Soviet re- far-right, with the support of the US of The Foundation for Researching publics not currently in the EU. On 28 March, in response to and EU for committing many grave Problems in Democracy, and the the annexation of Crimea and Russian military measures, the abuses of human rights. The report WHITE BOOK Moscow Bureau for Human Rights. European Council decided to sign part of the long-delayed says “the protests in Ukraine which The main complaints are around association agreement with Ukraine and agreed on punitive bore an initially peaceful character ON VIOLATIONS OF HUMAN RIGHTS the extreme right, especially the action against Russia. On 17 April, President Vladimir Putin rapidly escalated into a coercive re- AND THE RULE OF LAW ‘Right Sector’ and Svoboda. of Russia called publicly for a new (unspecified) sovereignty bellion and, in the end, the forceful IN UKRAINE The detailed report contains a arrangement for important cities in Ukraine: “We need to seizure of power and an unconstitu- timeline of events and recorded vio- encourage them to find a solution” to their estrangement tional coup d’etat.” (NOVEMBER 2013 — MARCH 2014) lations of rights and law, with picto- from Russia, he said. He was not moved by the EU strategy. The Ukrainian government’s ac- rial evidence. Any new EU plan must have two elements: one that strength- tions, with their supporters were «purges» and arrests amongst “The onslaught of racism, xeno- ens Ukraine and its people with political will and economic responsible for “manifestations of them, repression, physical violence, phobia, ethnic intolerance, the glori- resources to rebuild; and one that addresses the crisis dy- extremist, ultranationalist, and neo- and sometimes plain criminal law- fication of the Nazis and their Ban- namic now in play between Russia and the EU. Yet so far, Nazistic sentiments, religious intol- lessness have become commonplace derite sycophants should be brought in spite of limited financial support to Ukraine and long- erance, xenophobia, blatant black- in Ukraine.” to a speedy end through the united overdue signature of the association agreement, it is hard to mail, threats, pressure placed by the Calling the Maidan protesters efforts of the Ukrainian people and see any material distinction between EU policy towards its Maidan leaders on their opponents, “bandits” the report criticises amnes- the international community.” crisis with Russia and its policy on the more than 30 coun- tries, from North Korea to Ivory Coast, named in the list of “Restrictive measures (sanctions) in force” circulated by the Council. Is there no material difference for Europe between Could a dose of Juncker be what digital Europe needs? these other countries and what is going on in relations with is organized towards the flexibility is competition law with a continental Ukraine and Russia? Sanctions have a feel good effect for the By Ajit Jaokar the answer. spirit,“ signals that he understands imposer, but by themselves do not constitute a strategy. The founder of the It appears that slowly this penny that mergers have an important role The two elements of the new EU strategy must be tightly London-based research is beginning to drop amongst Eu- to play in driving much needed com- integrated: the measures to shore up political resilience in company Futuretext. rope’s leaders. petition, innovation and investment. Ukraine must also speak directly to resolution of the crisis He conducts a course at The recent statements by Jean- He clearly understands that market with Russia. Oxford University on Big Claude Juncker, candidate for the consolidation will drive economies The new strategy must be clear on incentives for de-escala- Data and M2M and also Presidency of the next European of scale and benefit the consumer. tion of tension around violence in Ukraine even as the EU at the technical university Commission, has blown a breath of A fragmented market undermines gears up for an increase in political conflict with Russia. of Madrid on their smart- fresh air into the debate. By whole- all of this. By maintaining the status The EU strategy must aim for a reduction in violence and cities programme. heartedly throwing his weight behind quo Europe’s digital hands will re- the threat of use of armed force, but it must not aim to re- a real Single Digital Market the Presi- main tied, its markets moribund and duce political tensions with Russia without having sight of Currently in Brazil attending the dential hopeful has signaled that a sea- defenceless in the face of increasing the formula for a lasting settlement with Russia on the issue Net Mundial conference, my atten- change in attitudes to regulation of the global competition. that led to the crisis. To reach this point, EU foreign minis- tion was captured about the raging telecoms market may be on the cards More broadly a future-focused ters need to admit serious mistakes and failures in diplomacy debate about the future framework after the European elections. Until regulatory framework is needed that over the last decade. The purpose in admitting mistakes is of the telecoms market as key to Eu- now conservative competition regu- embraces technological change. We to establish a baseline for new policy. If the main lines of the rope’s future competitiveness. The lators have generally sought to main- need to put the inefficiencies and in- new policy toward Russia and Ukraine look and feel like the digital revolution, especially mobile tain at least four telecoms operators in consistencies of the present behind policy before the crisis, merely with sanctions against Russia internet, offers Europe an oppor- every major market. us. Technology is changing at an just tacked on, then they will be inadequate. The danger is tunity to innovate, create and drive This has meant lower prices for increasingly rapid rate and without that without a clear and bold new strategy, EU officials will much needed change. consumers but has stifled network the much vaunted flexibility Europe have no choice but to continue executing pre-agreed policy However globally the digital mar- investments and placed European will be left behind. Juncker’s prom- in Ukraine, even if this continuation exacerbates the crisis ket is more competitive than ever operators at a disadvantage to their ise to make “Regulating less, better with Russia. The foreign ministers might consider the value and so to deliver the full benefits US and Asian counterparts. and simpler…a clear priority of my of abandoning linkage on issues of integration as part of a of an Internet economy to its busi- Juncker has clearly realised that Commission from day one and until formal process of “association” and move rapidly to institute, nesses and citizens Europe needs to a fundamental rethink of the rules my last day in office” is the right one as befits the crisis situation, practical measures for deeper in- adapt its regulatory models and en- governing the market are necessary. and one to which he must be held ac- tegration of Ukraine on the human and social levels. courage the private sector to invest His assertion that “If we ask compa- count by his Parliamentary masters While supporting Ukraine more directly, the Council also in the networks that are needed to nies to offer their networks and ser- should he succeed in becoming the needs a new strategy to address the psychology in Russia underpin such a renaissance. A fun- vices not only nationally any longer first President of the Commission that underlies this crisis. damental paradigm shift in the way but now on a continental scale, we nominated from the European Par- that the European telecoms market should, in my view, also apply EU liament in July. Dr. Greg Austin, Professorial Fellow, the EastWest Institute (New York) NEWEUROPE 12 www.neweurope.eu Energy & climate 11-17 May, 2014

Once secure, Libya’s oil output thewill growth of the oil industry,soar while their By Kostis Geropoulos standard of living has deteriorated. Libya ATHENS – Libya can achieve an oil is currently amending its legislation on production of 1.3-1.4 million barrels per the oil sector, investments, the environ- day within a few weeks, once the security ment, taxation and international regula- situation is under control, Libya’s deputy tions, he said. minister of oil and gas told New Europe But Elshakmak also tried to reassure on May 5. foreign energy investors that “all transac- “Now we are talking about less than tions are based on transparency. We have 300,000 barrels per day and we can achieve fully respect the existing international 1.3-1.4, which is within the [OPEC] quo- agreements”. He stressed that the Libyan ta,” said Omar Ali Elshakmak, referring to government doesn’t want any disruptions the Organisation of Petroleum Exporting in the North African country’s collabora- Countries’ production ceiling. tions with companies and countries from OPEC output is currently capped at abroad. 30 million barrels a day, but the group On the sidelines of the conference, plans to meet in Vienna on June 11 to he explained to New Europe that he was review the figure. OPEC supplies 40% of referring to “the existing contracts and the world’s oil. agreements with our partners. For the The oil terminal of Marsa al-Hariga in eastern Libya. Libya can achieve an oil production of 1.3-1.4 Elshakmak was talking on the side- million barrels per day within a few weeks once the security situation is under control, Libya’s deputy future, we’ll have a new round for explo- lines of a conference in Athens on Europe minister of oil and gas said. AFP PHOTO/ABDULLAH DOMA ration. That’s after we have finalised the and the Arab World in the framework of legalisation of the oil law and some other the Greek EU Presidency. The session der control we can achieve it within a few Libya’s proximity to the Mediterranean, regulations”. focused on the outlook for energy in the weeks,” Elshakmak said. “Europe is the first direct market. On the Following the blockade in Eastern region. During the conference, Elshakmak, other hand, we have no limitation. Once ports and strikes and occupations in The Libyan deputy oil and gas minis- who is heading a Libyan oil and gas del- we have opportunity, we have chance for Western oil fields, Libya’s oil production ter said that from an operational point of egation to Greece, noted that the pipeline opening new markets is Asia, any other has fallen below 300,000 barrels a day. But view it doesn’t take long to increase Lib- linking Libya with Italy guarantees Libya countries”. He also did not rule out coop- there have been signs of progress in restor- ya’s oil production. contribution to ensuring the supply of en- eration with Russia. ing some of Libya’s oil output as tribes- “But clearly the security issue is the ergy to European countries. During his speech Elshakmak said the men ended a blockade of the El Sharara most important and as soon as this is un- He told New Europe that, due to Libyan people have not benefited from oilfield. EU needs energy security, yesterday ATHENS - The recent developments in met in Rome where they discussed ways to Alleviating Ukraine highlight energy security and diver- strengthen collective energy security. The Europe’s sification of supply sources as two sensitive energy ministers released a 13-point plan dependence areas of European energy policy, a member that foresees greater gas pipeline network on gas supplies of the European Parliament’s Committee on connectivity, reverse flow pipelines and in- from Russia Industry, Research and Energy (ITRE) said vestment in gas storage facilities as well as - a problem on May 5 in Athens. low-carbon energy supplies and energy ef- exacerbated Niki Tzavela from Greece, a rapporteur on ficiency improvements. by the crisis in the European energy strategy 2025 and The United States, Canada, Japan, Britain, Ukraine – will be shale gas, repeated EU concerns that the France, Germany and Italy resumed G7-for- further discussed 28-country bloc relies too heavily on Rus- mat meetings in March, after Russia was ex- when the Group of Seven (G7) sian gas supplies. pelled from the Group of Eight (G8) forum leaders meet “Given the recent developments in Ukraine, due to its support for separatists in Ukraine. at a summit in we are here to highlight these two sensitive “In this [June] meeting we will discuss al- Brussels in June. aspects of the European energy policy: en- ternative supply options that will reduce ergy security and diversification of supply dependence on Russian hydrocarbons,” sources. In average, the EU receives 60 to Tzavela said. 70% of its energy from Russia. At the same “I have been appointed president of the natural gas and the development of south- natural gas grids that will be fed by the pipe- time, we have developments on the other European taskforce that will work with the eastern Mediterranean and Aegean fields lines that transport gas coming from east to side of the Atlantic so the global energy map American Congress and the respective com- will “help Europe become an important west such as TAP and possibly East Med but is revisited and redrawn, given that the US mittee on energy and these two committees player in the geopolitical developments in very importantly also the LNG terminals to expects its energy independence to be valid will discuss energy issues,” she said, noting the region”. Greece,” he said. by 2035 – thanks to shale gas,” Tzavela told a that energy is included in the EU-US free- Meanwhile, Panagiotis Mihalos, Secretary Mihalos explained to New Europe on the conference on Europe and the Arab World in trade agreement. She added that exporting General for International Economic Rela- sidelines of the conference that the vertical the framework of the Greek EU Presidency. natural gas from the US during the crisis in tions at Greece’s Ministry of Foreign Affairs, corridor will consist of the Interconnector The status quo of traditional energy suppli- Ukraine is a major topic. told the same conference that the Trans Adri- Greece - Bulgaria (IGB), the Gas Intercon- ers is changing and this will mainly affect the However, there are technical difficulties as atic Pipeline (TAP) that will bring gas from nection Bulgaria -Romania (IBR) and gas liquefied natural gas (LNG) marketplace, the US infrastructure was destined to import the Caspian region through Greece, Albania connections through the four Visegrad she said. hydrocarbons, not exporting them, she said. to southern Italy will put “Greece into the en- states: Hungary, Slovakia Czech Republic Alleviating Europe’s dependence on gas sup- The MEP predicted, however, that “prob- ergy landscape of our broader region”. and Poland. plies from Russia – a problem exacerbated ably in the near future we will start export- “The situation in Ukraine has highlighted “These interconnectors, some of which are by the crisis in Ukraine – will be further dis- ing natural gas and oil from the US to some the need for energy security and diversifica- ready or planned to be constructed, will al- cussed when the Group of Seven (G7) lead- European states”. tion, thus our proposal for a vertical corridor low transporting gas from the south to the ers meet at a summit in Brussels on June 4-5. In addition to the shale gas revolution, Tza- linking south and north Europe – a network north of Europe with minimal interven- On May 4 and 5, the G7 energy ministers vela also said the expansion of the use of of interconnectors between the national tions,” he said. NEWEUROPE www.neweurope.eu 13 11-17 May, 2014 Energy & climate

Iran close to exporting gas to Iraq By Kostis Geropoulos Energy Insider

Israel Eyes Egyptian Conduit For EU Gas The owners of an Israeli gas field have reached an agree- ment to export natural gas through Egypt, an economi- cally lucrative deal that could also cool off any anti-Israeli sentiments in the Middle East. Houston-based Noble Energy, the largest owner of Israel’s Tamar gas field, signed a non-binding letter of intent on 5 May to ship up to 4.5 billion cubic metres of gas a year to Spain’s Union Fenosa, which operates Egypt’s natural gas export facility at Damietta. Egypt would then liquefy the gas, preparing it for export. The deal could be worth as much as $1.3 billion per year. Fadel Gheit, a senior oil and gas analyst at Oppenheimer in New York, pointed out on 8 May that selling gas from Iran’s South pars quarter one (SPQ1) gas platform in the Persian gulf waters on the edge of the Qatar territorial waters, near the Israel’s Tamar field to Europe via Egypt is a lot cheaper southern Iranian port of Assalouyeh, Iran. EPA/ABEDIN TAHERKENAREH than building a liquefied natural gas (LNG) facility in Is- ran could send natural gas to pow- tions imposed on the Iranian energy analyst at Oppenheimer in New York, rael for export. er stations in southern Iraq during sector. Though Iran secured some sanc- told New Europe on 8 May that Iraqis “The more the gas is kept locally, the cheaper the devel- the current calendar year, Iran’s tions relief through an interim nuclear use a lot of oil to generate electricity. opment is going to be. The most expensive option will be Ideputy Oil Minister for International deal with Western powers last year, the “It’s a lot cleaner and cheaper to use gas export LNG that would require huge upfront investment Affairs Ali Majedi said, adding that a US government in particular has said and they can spare the oil for export so in the tens of billions of dollars that nobody seems to be pipeline from southern Iran across the Iran is not yet open for business. it makes a lot of sense,” Gheit said. willing to make so the best options right now is selling border to power stations in Basra prov- Majedi said the pipeline from He argued that the best thing for gas to Jordan, to the Palestinian Authority and to Egypt,” ince is “currently under construction”. Asaluyeh could reach into the Syrian all the countries in the Middle East Gheit told New Europe. The project is aimed at supply- market when conditions return to nor- is to export their oil and try to find Egypt used to be a net exporter of gas and sold gas to Is- ing Al-Baghdad and Al-Mansouriyah mal in the war-torn country. substitutes to burning oil to generate rael until three years ago. “Now the shoe is on the other power plants in Iraq with 25 million In April, Tehran said work on the electricity by switching to natural gas. foot and things have changed 180 degrees. Now Egypt cubic metres per day of natural gas. construction of Iranian part of a gas “Obviously they don’t have nuclear but is running out of gas and Israel will be a supplier gas to The pipeline will stretch from the pipeline to Iraq was 75% complete and by switching from oil to gas will free up Egypt,” he said. Iranian port city of Asaluyeh, near the the pipeline would become operation- a lot of oil for the export market,” he Gheit said the best option is that both Israel and Egypt South Pars gas field, to Iraq. al within four months. After the com- said. will collaborate on monetising the Israeli gas by actually Iran has boasted of its potential to pletion of the project Iran can export 5 Gas from Iran would feed Iraqi utilising Egypt’s liquefaction facilities that are right now reach new gas customers through its million cubic metres of natural gas to electrical plants because Iraq has very operating at very small capacity. “That makes a lot of massive South Pars gas complex which Iraq in the first phase and the exports little gas and needs a stable supply of sense since you have existing assets that are not utilised. it shares with Qatar. will reach 10 million cubic metres in gas from Iran which has one of the The Israelis can give gas to Egypt in exchange for allow- European officials have brushed off next stages. largest gas reserves in the world, the ing the Israeli gas to be converted into LNG and be sold Tehran’s gas offerings because of sanc- Fadel Gheit, a senior oil and gas Oppenheimer oil and gas analyst said. to Europe so it’s really win-win situation,” Gheit said. Meanwhile, officials in Cyprus, which is also exploring its own offshore reserves for export to Europe, have said Gazprom to demand advanced payment for gas to Ukraine that the search for additional sources of gas must move Russian gas exports to Europe through Russia, Ukraine and the European Ukraine is prepared to pay the debt quickly since the amount of the fuel inside Cyprus’ single Ukraine remained stable on 8 May, a Commission plan to hold a new round in 10 days following an agreement by proven field off its south coast isn’t enough to secure the spokesman for Russian gas monopoly of talks to negotiate the debt; its date Gazprom to amend the contract to re- billions of euros needed from investors to finance con- Gazprom said. will be discussed on 12 May, Russia’s turn to the previous price of $268 per struction of a land-based LNG facility. On 7 May, Gazprom said Ukraine Energy Ministry said. 1,000 cubic metres, Interfax quoted Gheit said Cyprus may need to follow Israel’s example. has failed to pay its mounting gas bill, Russia will consider offering Ukrainian Prime Minister Arseniy Yat- Egypt is a huge market but the Israeli gas could well ex- which now has hit $3.5 billion, mean- Ukraine a discount during the second senyuk as saying on 7 May. ceed the local demand for gas and therefore the Egyptians ing that in June Ukraine will receive round of talks, which may take place On 2 May, Ukrainian Energy and the Israelis could take a big portion of this gas and Russian gas only on the condition of from 16 May to 19 May, as long as Minister Yuri Prodan said his country, convert it to LNG for exports to Europe. “The biggest advanced payment. Ukraine pays its gas debt, Izvestia quot- which aims to limit its dependence risk is the upfront investment. But the LNG facility is “The deadline has passed, no pay- ed an unidentified government official on Russian gas, is seeking an “honest, already in Egypt,” Gheit said, predicting that a pipeline ment has been received,” Gazprom as saying on 7 May. market price” for it. Gazprom raised could be built in less than a year that will take the gas two spokesman Sergey Kupriyanov said. Europe imports about 30% of its the price to $485 per 1,000 cubic me- ways: to the local Egyptian market and to the Egyptian Earlier Gazprom said if the dead- gas from Russia, half of which crosses ters after Russia ended all discounts LNG liquefaction facilities for export to Europe. line was not met, Gazprom would issue Ukraine, making the former Soviet re- in place. Ukraine may receive $13.7 The added advantage, Gheit said, is that selling gas to an advance bill for June gas supplies on public a key player in the Europe’s en- billion this year from both the Inter- Egypt, Jordan and Palestine “will cool off any anti-Israeli 16 May. The debt as of 7 May stands at ergy security. national Monetary Fund (IMF) and sentiments in the Middle East because it will be econom- $3.508 billion, Gazprom said, up from Prior price disputes between Rus- international donors, the Finance Min- ic benefit for both”. the $2.2 billion tab at the end of April. sian and Ukraine led to disrupted gas istry in Kiev said on 7 May in a state- [email protected] Ukraine has contested the sum owned flows to Europe during cold weather in ment. The IMF funds will go to gov- follow on twitter @energyinsider to Gazprom. 2006 and 2009. ernment and the central bank, it said. NEWEUROPE 14 www.neweurope.eu ARTS & CULTURE 11-17 May, 2014 Rome rediscovers Fellini’s feminine muse The exhibition, which will be hosted By Federico Grandesso A photo of until May 30 at the Complesso Monu- 1958 shows ehind every great man there’s a great from (L-R), mentale di sant’Andrea al Quirinale – Tea- woman. This saying rings true for It- producer Dino tro dei Dioscuri, in via Piacenza 1, will be aly’s world famous film director Fed- De Laurentiis, open free of charge weekdays between Berico Fellini and his wife Giulietta Masina. Italiam film 9am and 6.30pm. For this reason, there is an important director Stéphane Marti, the president of the exhibition in Rome titled “Giulietta Masina Federico Fellini, Fellini Foundation, said: “After the exhibi- l’Oscar di Federico Fellini”. It investigates the unidentified tions for the movie 8 1/2 in Venice and in discrete role of the Masina in Fellini’s Oscar- woman and Milan, Rome is for us a closure of a circle. winning masterpiece La Strada. Curated by Italian actress Our foundation will also inaugurate one Simone Casavecchia and Fiammetta Ter- Giulietta Masina week after Rome in its cultural centre in Sion lizzi, the exhibition is being held under the posing for a another important exhibition dedicated photograph at auspices of the Academy of the Italian Cine- an Italian movie this time to Audrey Hepburn. This actress ma - Premi David di Donatello and the Swiss awards ceremony was born in Brussels in the area of Ixelles, Institute of Rome, and supported by numer- in Italy. but also visited a lot Switzerland and the ous partners like the Direzione Generale per EPA/ANSA ARCHIVE canton Vallais. After these two exhibitions, i Beni Librari gli Istituti Culturali e il diritto the foundation is discussing an agreement d’Autore (MiBACT), the Centro per il Libro memorable films like Il Bidone. ale del Centro Sperimentale di Cinemato- with Nanyang Technological University of e la Lettura, the Angelica Library, the Centro Masina, who was always compared by grafia. The posters are from The Fellini Singapore in order to organise a long-term Sperimentale di Cinematografia, The Fellini the film critics as a feminine Chaplin, won Foundation for the Cinema of Sion (CH). programme which includes some exhibi- Foundation for the Cinema of Sion (CH), the Best Actress award in the 1957 Cannes The exhibition also features the first edi- tions, symposiums and the creation in the the Deutsch Museum (Museum of modern Film Festival for her role in the Oscar-win- tions of photo books, screenplays in dif- Asian state of a digital cultural centre for and contemporary art) in Lausanne (CH) ning Nights of Cabiria. She was also twice ferent languages, and texts describing the the student dedicated to Federico Fellini. and, last but not least, the Edizioni Sabinæ. nominated for a BAFTA film award as best extraordinary artistic path of the couple We are also looking forward to organising The exhibition is divided into four foreign actress. Her last film was A Day to Fellini-Masina. a Fellini exhibition in Brussels during the parts in which visitors will discover the Remember in 1991. For the first time ever, the public will Italian presidency of the European Union Fellini films in which Masina acted: La The photographs that are part of the have the opportunity to admire the origi- during which we could rediscover some of Strada, Nights of Cabiria, Giulietta degli exhibition in the Italian capital are on loan nal 1956 Oscar for Best Foreign Film that the last extraordinary collaborators of the Spiriti and Ginger e Fred, as well as other from the Archive of the Fototeca Nazion- was awarded for La Strada. Italian maestro.”

ADVERTISEMENT NEWEUROPE www.neweurope.eu 15 11-17 May, 2014 BRUSSELS AGENDA

Upcoming Events Back and call Jeff Beck 20:00, 26 May, In the beginning Ancienne Belgique The British guitarist is named alongside people like Jimmy Page, Eric Clapton, Peter Green and John Mayall. While he’s performed with the Yard- birds, Stevie Wonder and Rod Stewart, he’s also assisted Morrisey and Brian Wilson. Rolling Stone named him the fifth best gui- EPA/J.J. GUILLEN tarist of all time; he’s also collected six Grammy He’s always had his quirky side, such as per- awards and has been inducted into the Rock n forming ‘Beck’s Bolero’ with Jimmy Page, John Roll Hall of Fame. Twice: Once as a member of Paul Jones, Nicky Hopkins and Keith Moon and the Yardbirds, in 1992, and again, as himself, in he has dabbled ever since with the unusual. His 2009. The story goes that he first knew what he instrumental performance of the Beatle’s ‘A Day wanted to do in life when, in 1950 at the age of six, in the Life’ is but one example of taking his guitar he first heard Les Paul playing on the radio. Ask- where nobody else would. ing his mother what the sound was, she said it was He’s still on top of his game, perhaps he knows an electric guitar, “That’s for me” he replied. Then Why. He told an interviewer, “I don't understand he met Jimmy Page as a teenager. why some people will only accept a guitar if it has By 1965, he replaced Eric Clapton as Yard- an instantly recognisable guitar sound. Finding birds guitarist and his career took off. While it is ways to use the same guitar people have been us- easy to look at Beck as a central part of music, what ing for 50 years to make sounds that no one has was happening was very new and daring. He was, heard before is truly what gets me off.” in fact, with a group of extremely talented people He’s also a survivor and serious about giving on the cutting edge of what we now call rock. his best.

Resto Bites says he is injecting new life and energy into the Steve Hackett: Genesis Extended songs and the tour. ‘T Jong Gerecht, 20:00, 16 May, Ancienne Belgique Prog rock has survived, as Hackett told 119 Langestraat, Hackett was at the AB last year, selling out as The Vinyl District magazine, “It’s gone Bruges he did in the Royal Albert Hall, and he’s com- through many reinterpretations; it’s certainly Tel 050 31 3232 ing back for more… with more! borrowed from enough forms—from opera www.tjonggerecht.be Hackett is one of the leading British gui- to pantomime and then back again—so many tarists and one of the architects of progressive influences, so many different kinds of music… Bruges has recently become a mas- rock, influencing many axe wavers, such as Ed- I’m thrilled and delighted that it’s survived.” sively popular setting for Hollywood die Van Halen, Brian May and Steve Rothery. But it is the music above all. “The star of blockbusters like George Clooney’s He joined Genesis in 1970, staying for sev- the show is really the music. It seems to sur- Monument’s Men so what better en years, after placing an advert in UK music vive lots of different interpretations by differ- excuse to visit and see what all the fuss magazine Melody Maker saying he was search- ent line-ups,” Hackett observes, “It’s survived is about? ing for like-minded musicians "determined to much longer than I thought; we just imagined If you find yourself in to this historic city strive beyond existing stagnant music forms". that we were being as competitive as the next you really should find time to visit this This attracted the attention of Peter Ga- band on the block, and that it would be forgot- splendid restaurant, owned since January briel and Hackett played on six studio and ten pretty quickly.” by Lisa De Clerck and Emmanuel Niess, a young couple with enormous culinary talent. three live albums for Genesis. But it wasn’t. And this performance, a mix Meals are preceded by mise en bouche, a varied assortment of absolutely delicious and very This tour brings a supergroup to the best of the fans’ favourite tunes and a lights show, creatively-produced appetizers. of Genesis, but this is no nostalgia, Hackett will also be remembered. Done properly. This really sets the tone for the cracking cuisine that follows. There’s a lovely a la carte option but, apparently, the overwhelming favourites with diners are the fixed menus, starting at a very democratic €39 for three courses. The menus, which are refreshed every five weeks or so,include mouth-watering dishes such as lamb with fennel and leek and dorade royale with asparagus. The pea may be a modest veg, but Emmanuel can also do amazing things with it! The lunch menu, priced a mere €24, is available Monday-Friday and is also hugely popular. If you’re a wine-lover, a visit here will not disappoint as you can avail yourself of Lisa’s expertise. The ever-smiling host goes to great lengths to ensure the wine perfectly matches the cuisine. With its delightful contemporary interior, this intimate restaurant is close to the many attrac- tions and so popular that customers are turned away. Be assured, you really will be impressed. NEWEUROPE 16 www.neweurope.eu Science 11-17 May, 2014

President of ERC Jean-Pierre Bourguignon, President Gi-Won On, Director General of DG R&I The president of KIC-Europe Dr. GI-Won On is talking about mutual cooperation Robert-Jan Smits, Ambassador Chang-Beom Kim in S&T sector KIC-Europe hosted an Open House networking reception he Korea Research & Innovation bassador Chang-Beom Kim, Robert-Jan occasion enjoyed by all who attended. The Korean and EU presidents share Centre-Europe (KIC-Europe) Smits, Director General, DG Research KIC was established in November the vision that the core of the creative hosted a reception under the ban- and Innovation, and the President of KIC- 2013 with the aim to foster links with EU economy lies in science, technology and Tner of Cooperation Platform to allow its Europe, Gi-Won On, all recognised the organisations, research centres and insti- innovation. Both sides hailed the open- partner organisations and relevant mem- importance of cooperation between Ko- tutions. The ministry of science, ICT and ing of the KIC-Europe and the signing of bers of the European Commission and the rea and the EU. future planning is actively promoting joint an agreement, in November 2013, to pro- European Research Centre to network. The president of the European Re- research programmes and will support mote the exchange of Korean researchers The first Korean S&T network event search Council (ERC), Dr Jean-Pierre start-ups and Research & Business Devel- at European research institutes. was successfully held at the KIC-Europe Bourguignon, also delivered a celebratory opment in the European markets through headquarters in Brussels on May 7. speech in honour of KIC-Europe. today’s networking together with KIC- For more info, visit the website Addressing the event, Korean Am- Organisers hailed the event as a great Europe. www.kiceurope.eu

New frog species found in troubled Indian habitat published Thursday in the Ceylon Journal derlined how vulnerable they might be to zone across the Ghats to limit polluting By Katy Daigle, AP Environment Writer of Science — brings the number of known changes in rainfall or water availability. industrial activities and human encroach- Scientists have discovered 14 new species of Indian dancing frog species to 24. These are tiny, delicate frogs — no ment, but it put the latest proposal on hold so-called dancing frogs in the jungle moun- They’re found exclusively in the West- bigger than a walnut — and can easily be earlier this year. tains of southern India — just in time, they ern Ghats, a lush mountain range that swept away in a gushing mountain stream. Meanwhile, as India’s population has fear, to watch them fade away. stretches 1,600 kilometers from the west- So breeding happens only once the level of grown to a staggering 1.2 billion, at least Indian biologists say they found the ern state of Maharashtra down to the coun- a stream levels drops to the point where the 25 percent of the forests have vanished tiny acrobatic amphibians, which earned try’s southern tip. water babbles over boulders and stones, he from the Ghats, which is now home to their name with the unusual kicks they use Only the males dance — it’s actually a explained. If streams hold less water or dry more than 325 of the world’s threatened to attract mates, declining dramatically in unique breeding behavior called foot-flag- out too early, the frogs get caught without species of plants, birds, amphibians, rep- number during the 12 years in which they ging. They stretch, extend and whip their the right conditions to breed. tiles and fish. chronicled the species through morpho- legs out to the side to draw the attention “Compared with other frogs, these are Many of these newly discovered frogs logical descriptions and molecular DNA of females who might have trouble hearing so sensitive to this habitat that any change could soon be joining them, Biju said. markers. They breed after the yearly mon- mating croaks over the sound of water flow- might be devastating for them,” Biju said. Many of the 24 known Indian dancing frog soon in fast-rushing streams, but their ing through perennial hill streams. “Back in 2006, we saw maybe 400 to 500 species lives only in a single, small area. habitat appears to be becoming increas- They bigger the frog, the more they hopping around during the egg-laying sea- Seven were in what Biju described as highly ingly dry. dance. They also use those leg extensions son. But each year there were less, and in degraded habitats where logging or new “It’s like a Hollywood movie, both joyful to smack away other males — an important the end even if you worked very hard it was plantations were taking over, while another and sad. On the one hand, we have brought feature considering the sex ratio for the am- difficult to catch even 100.” 12 species were in areas that appeared in these beautiful frogs into public knowledge. phibians is usually around 100 males to one The Western Ghats, older than the ecological decline. But about 80% are outside protected areas, female. Himalayas, is among the world’s most bio- Biju’s determination, or even obses- and in some places, it was as if nature itself There are other dancing frogs in Cen- logically exciting regions, holding at least a sion, with documenting as many new frog was crying,” said the project’s lead scientist, tral America and Southeast Asia, but the quarter of all Indian species. Yet in recent species as possible stems from his fear that University of Delhi professor Sathyabhama Indian family, known by the scientific name decades, the region has faced a constant many will vanish as “unnamed extinctions” Das Biju. Micrixalidae, evolved separately about 85 assault by iron and bauxite mining, water before scientists ever learn they exist. Sci- Biju said that, as researchers tracked million years ago. pollution, unregulated farming and loss of entists believe Earth has about 8.7 million frog populations, forest soils lost moisture Biju and his team had long been baf- habitat to human settlements. distinct plant and animal species, but they and perennial streams ran inexplicably dry. fled about the frogs’ mating patterns, after A 2010 report by India’s Environment have documented only 1.5 million. He acknowledged his team’s observations searching years around the forest floor for Ministry also said the Ghats were likely to Amphibians are particularly vulnerable. about forest conditions were only anecdo- egg clutches without success. But one late be hard-hit by changing rainfall patterns At least one-third of the world’s known tal; the scientists did not have time or re- October day in 2011 they witnessed a rare due to climate change, and more recent 6,000 frog species are threatened with ex- sources to collect data demonstrating the tryst, and saw the female immediately bury scientific studies have also suggested mon- tinction from habitat loss, pollution, chang- declining habitat trends they believed they her eggs once fertilized. This confirmed soon patterns will grow increasingly erratic. ing temperatures or exotic diseases spread were witnessing. the frogs were indeed breeding only after India’s government has been working to by invasive animals and pests, according to The study listing the new species — stream levels had come down, and un- establish a vast environmental protection Global Wildlife Conservation.

Tumblr founder David Karp and Yahoo CEO Marissa Mayer | MARIO TAMA/GETTY IMAGES/AFP NEWEUROPE www.neweurope.eu 17 11-17 May, 2014 Science

Global Warming Anthropology Scavengers important Federal report: Warming for human evolution A new study led by Spanish researchers from the Univer- sity Miguel Hernandez in Elche has shed light on the age- old interactions between humans and scavengers. disrupts Americans’ lives Researchers Marcos Moleón and José Antonio Sánchez Zapata found evidence supporting the argument that hu- man interaction with scavengers (especially vultures, hy- enas and lions) has played an important role in the evolu- tion of humankind. The findings of the study, which was published in the journal BioScience, also suggest the ex- tinction of large carnivorous mammals threatens to wipe out the many services that they provide us and has impli- cations in the cognitive, ecological and cultural identity of modern human beings. “The way that humans have acquired meat since it became a fundamental component of our diet has changed from the consumption of dead animals to hunting live ones, the domestication of wild animals and finally intensive exploitation,” the research- ers explain. “In each of these periods, humans have been closely related to other scavengers. At first, the interaction was primarily competitive, but when humans went from eating carrion to generating it, scavengers highly benefited from the relationship. Today, humans benefit the most from the multiple services provided by scavengers.” The research ship ‘Polarstern’ (North Star) sailing on the Arctic Ocean at the North Pole. The period between 2002 and 2011 is Medicine the hottest decade on record. EPA/MARIOÂ HOPPMANN -Â ALFREDÂ WEGENERÂ many opportunities to take cost-ef- “Whether you agree or disagree Scientists uncover how By Seth Borenstein, fective actions to reduce the damage.” with the report, the question is: What AP Science Writer Release of the report, the third are you going to do about it? To us bacteria becomes deadly ost Americans are already edition of a congressionally mandated that is a major question,” said Charlie feeling man-made global study, gives Obama an opportunity to Drevna, president of the American Scientists sequenced more than 200 strains of the bubonic warming, from heat waves ground his campaign against climate Fuel and Petrochemical Manufactur- plague’s Yersinia family of bacteria and made a rather sur- Mto wild storms to longer allergy sea- change in science and numbers, en- ers. He called the report “overblown.” prising discovery, according to a report published by the sons. And it is likely to get worse and deavouring to blunt the arguments of The report — which is full of Wellcome Trust Sanger Institute. Contrary to popular more expensive, says a new federal re- those who question the idea and hu- figures, charts and other research- belief, the findings suggest that pathogenic members of port that is heating up political debate man contributions to such changes. generated graphics — includes 3,096 this bacterial family do not share a recent common dis- along with the temperature. Later this summer, the administra- footnotes referring to other mostly ease-causing ancestor. Instead, they have followed parallel Shortly after the report came out tion plans to propose new regulations peer-reviewed research. It was written evolutionary paths that make them harmful. “Before this on May 6, United States President restricting gases that come from exist- by more than 250 scientists and gov- study, there was uncertainty about what path these species Barack Obama used several television ing coal-fired power plants. ernment officials, starting in 2012. A took to become pathogenic: had they split from a shared weathermen to make his point about Not everyone is persuaded. draft was released in January 2013, common pathogenic ancestor? Or had they evolved in- the bad weather news and a need for Some fossil energy groups, con- but this version has been reviewed dependently” says Professor Nicholas Thomson, senior action to curb carbon pollution be- servative think tanks and Republican by more scientists, including twice author from the Wellcome Trust Sanger Institute. “What fore it is too late. senators immediately assailed the re- by the National Academy of Sciences we found were signatures in their genomes which plot the “We want to emphasise to the port as “alarmist.” Senate Republican which called it “reasonable,” and “a evolutionary path they took. “Surprisingly they emerged public, this is not some distant prob- leader Mitch McConnell of Kentucky valuable resource.” as human pathogens independently from a background of lem of the future. This is a problem said Obama was likely to “use the Environmental groups praised the non-pathogenic close relatives. These genetic signatures that is affecting Americans right platform to renew his call for a nation- report. “If we don’t slam the brakes on mark foothold moments of the emergence of these infa- now,” Obama told “Today” show al energy tax. And I’m sure he’ll get the carbon pollution driving climate mous disease-causing bacteria.” This unique and detailed weathercaster Al Roker. “Whether loud cheers from liberal elites —from change, we’re dooming ourselves and dataset describes the parallel evolution of Yersinia pestis it means increased flooding, greater the kind of people who leave a our children to more intense heat and Yersinia enterocolitica; two major disease-causing vulnerability to drought, more se- giant carbon footprint and then waves, destructive floods and storms pathogens in people. The researchers showed that both vere wildfires — all these things are lecture everybody else about low- and surging sea levels,” said Frances species, independently of each other, acquired a segment having an impact on Americans as flow toilets.” Beinecke, president of the Natural of DNA known as plasmids, as well as the gene ail that al- we speak.” Climate change’s assort- Since taking office, Obama has Resources Defence Council. lowed them to become pathogenic. ed harms “are expected to become not proposed a specific tax on fos- Scientists and the White House increasingly disruptive across the sil fuel emissions. He has proposed a called it the most detailed and US- Science nation throughout this century and system that caps emissions and allows focused scientific report on global beyond,” the National Climate As- companies to trade carbon pollution warming. NASA’s Curiosity drills sessment concluded, emphasising credits, but it has failed in Congress. The report says the intensity, fre- the impact of too-wild weather as Republican Senator David Vitter quency and duration of the strongest sandstone rock on Mars well as simple warming. of Louisiana said the report was sup- Atlantic hurricanes have increased Still, it’s not too late to prevent the posed to be scientific but “it’s more of since the early 1980s, but it is still The United States space agency NASA said on May 6 that worst of climate change, says the 840- a political one used to justify govern- uncertain how much of that is from its Curiosity rover has completed its third drilling into a page report, which the Obama ad- ment overreach.” And leaders in the man-made arming. Winter storms Martian rock and is now preparing to use its internal instru- ministration is highlighting as it tries fossil fuel industry, which is respon- have increased in frequency and in- ments to study the collected powdered sample. Images sent to jump-start often-stalled efforts to sible for a large amount of the heat- tensity and have shifted northward back by Curiosity early on May 6 showed a fresh hole next curb heat-trapping gases. Said White trapping carbon dioxide, said their since the 1950s, it says. to a shallow test hole the rover made a week ago in the target House science adviser John Hold- energy is needed and America can‘t AP writers Josh Lederman and Nedra sandstone rock, dubbed “Windjana.” The new hole is about ren: “It’s a good-news story about the afford to cut back. Pickler contributed to this report. 1.6cm in diameter and about 6.6 cm deep, NASA said.“

Tumblr founder David Karp and Yahoo CEO Marissa Mayer | MARIO TAMA/GETTY IMAGES/AFP NEWEUROPE 18 www.neweurope.eu EUROPEAN UNION 11-17 May, 2014

Latvia|Media GERMANY | Privacy Latvia to allocate funds to improve Russian-speaking Merkel in Washington puts unity media programmes The Latvian government decided on May 6 to allocate funds to improve the content of Russian-speaking pro- above NSA spying investigation grammes. A total of €682,399 from the state budget, United States President Barack Obama programme “Contingency funds”, will be issued to the welcomed German Chancellor Angela Latvian State Channel (LTV), the government decided Merkel to Washington last week. He in a meeting. On channel LTV7, it is planned to launch gave her a personal tour of the White daily morning news in the Russian language, but on House and showed her everything Sunday’s analytical programme, LETA reported with from the vegetable garden to the birds reference to chairman of Latvian National Electronic nesting in the Rose Garden. But what Mass Media Council (LNEMMC) Ainars Dimants. Obama did not do, at least in front of For the Russian news, there will be another studio, as reporters, was to address the NSA spy- well as extra cameras to be bought for shooting items. ing scandal and the contentious no-spy Plans to launch a Russian-speaking channel to broad- deal that has since collapsed. cast in all three Baltic countries is currently put in hold. According to the German weekly Last month, the government issued €6,000 for the news magazine, Der Spiegel, Merkel is broadcasting of the Latvian radio 4 in the areas closed no longer committed to investigating to the Latvian borders with Russia and Belarus. the extent of NSA spying in Germany, (Xinhua) despite the fact that her own mobile telephone had also been bugged. US President Barack Obama and German Chancellor Angela Merkel walk back to In the world of diplomacy, mo- the Oval Office in the White House after giving a press conference following their Lithuania|Language ments of candour are rare, obscured meeting in Washington. AFP PHOTO/Jewel Samad as they are behind a veil of amicabil- dodge the question. He said: “As the to the back burner in Berlin. Merkel is Protestors urge Lithuanian ity and friendly gestures, reports Der world’s oldest continuous constitu- reportedly eager to do everything in Spiegel. It was no different last week at tional democracy, I think we know a lit- her power to avoid a conflict with the lawmakers not to allow Polish the meeting between Obama and Mer- tle bit about trying to protect people’s Americans and to boost cooperation in kel in Washington. privacy.” order to address the Ukraine crisis. spelling of names A courteous Obama described Merkel, on the other hand, was a bit With the situation in Ukraine con- A new name-spelling bill tabled in Lithuania’s parliament Merkel as “one of my closest partners” more direct in addressing the NSA spy- tinuing to escalate, Merkel is eager to by Social Democratic MPs Gediminas Kirkilas and Irena and a “friend”. When asked by report- ing scandal. She said: “There needs to demonstrate unity with Obama and Šiaulienė has stirred widespread controversy. Some 100 ers about the NSA spying scandal be and will have to be more than just the two threatened Russia with fur- people gathered outside the parliament on May 6 to pro- and whether German lawmakers are business as usual”. According to Der ther economic sanctions, reported Der test against the draft legislation. The demonstrators called still being monitored, he was quick to Spiegel, the scandal has been bumped Spiegel. for the protection of the Lithuanian language and urged lawmakers to block the proposal to allow for the spelling SWEDEN |Politics of names in non-Lithuanian characters. The rally outside parliament was led by Conservative MP Vytautas Juoza- paitis. “The Lithuanian language is the symbol of the state, Why Swedish ministers still get paid when they are too sick to work and symbols are not to be defiled,” Juozapaitis was quoted Under Swedish labour law, all work- was too sick to attend an EU meeting In the ministers’ defence, Chris- as saying by the local media. He also criticised Valdemar ers are subject to a first-day-off reduc- in Brussels in 2010. But he did not call tina Weihe, who is the legal head of the Tomaševski, the leader of the ruling Electoral Action of tion in salary if they are too sick to go in sick that day, which would have re- prime minister’s office, told the news- Poles in Lithuania, who claims minority rights are being to work. All workers, that is except for duced his monthly paycheque by 4,645 paper that ministers do not report be- violated. Polish politicians in Lithuania have repeatedly Swedish cabinet ministers. kronor (€512). ing sick because they are on call 24/7 called for the spelling of Polish names in Polish characters Sweden’s daily Dagens Nyheter What is more, only three of his 38 when they are fit to work. According to because the “w” does not exist in the Lithuanian alphabet. newspaper reported last week that 17 cabinet ministers have ever reported the newspaper’s political commentator ministers - including the prime minis- being sick, according to the newspaper. Ewa Stenberg, however, this practice is ter - had systematically failed to report Even the country’s IT Minister Anna- hypocritical. Finland|Gambling when they were off ill. Karin Hatt, who has even tweeted that “That makes it very controversial Several examples were presented she is home sick with a high-grade fe- when ministers don’t report in sick One in five affected by problem by the newspaper. One was that of ver, has never officially reported being when they are in fact off sick,” Stenberg Prime Minister Fredrik Reinfeldt, who sick. said. gambling in Finland Gambling is a growing problem in Finland, according Lithuania |Economy to new research conducted by the National Institute for Health and Welfare (THL). The findings suggest one in five Finns is affected. Ukraine’s crisis impacts Lithuanian economy While only 3% of Finns are classified as problem gam- The standoff between Russia and be limited,” he added. sion, strong domestic demand will be the blers, who closely resemble alcoholics and drug addicts, Ukraine will have minimal effects on the Sadzius‘ announcement came after main driver for the Lithuanian economy. one in five Finns surveyed said they have a friend or a Lithuanian economy, Lithuania‘s Finance the European Commission unveiled its “While net exports in the first quarter had close relative who is struggling with a gambling prob- Minister Rimantas Sadzius said on May 6. latest forecast on May 5. It affirmed a been the main growth driver, domestic lem. According to the findings, 8.6% of those surveyed “We have evaluated possible eco- positive outlook for Lithuania’s economy. demand took over in the second quarter. said a member of their family has a gambling problem. nomical consequences of those tensions Lithuanian‘s gross domestic product Substantial wage increases, low inflation, The family member is usually a sibling, father or spouse between Russia and Ukraine. Taking into (GDP) will grow 3.3% in 2014, the fore- falling unemployment and strong confi- or child. account our exports of goods to Russia cast showed. dence indicators boosted consumption,” More than 4,000 Finns between the age of 15 and 74 and 100% imports of natural gas from The EC forecast for the EU economy explained the European Commission. were surveyed by the THL between 2011 and 2012. Gazprom, we would feel influence there,” is that it will expand by 1.6% in 2014 The European Commission also pointed The research was commissioned by the social affairs Sadzius told the Baltic News Service. while the euro area will grow by 1.2%. out the risks to Lithuanian economy are and health ministry. “But our evaluation is that impact will According to the European Commis- connected to Russia. (Xinhua) NEWEUROPE www.neweurope.eu 19 11-17 May, 2014 EUROPEAN UNION

Hungary |Relations Croatia|EU Croatia lobbies for Hungary eager to reconcile with Serbia further EU integration Croatia, the newest member of the European Union, has emerged as the champion of the Balkans and is now ac- tively lobbying for further EU integration. According to a non-paper sent to the European Commission in Brussels, the government of Croatia said Bosnia and Herzegovina (BiH) should be permitted to fulfil all the required criteria during the negotiation process with the EU, as opposed to after. “The proposal should not be seen as a final solution, but as a start of discussion about the European future of BiH,” Vesna Pusić, the Croatian minister of foreign and European Affairs, told SETimes. Radovan Vukadinovic, a professor at the Faculty of Political Science in Zagreb, commended Croatia’s diplomacy on BiH’s behalf, and for showing its own initiative within the EU. “It is good to keep the interest in the region alive because it seems that big players’ attention has already been diverted from the Balkans to other important events. Lastly, it is good to show to the BiH leaders that they can count on Croatia, who will be their advocate in the EU,” Vukadinovic said. State Secretary of the Hungarian Foreign Ministry Zsolt Nemeth said Hungary and Serbia are reconciling past differences. EPA/ROBERT Hungary’s Foreign Affairs State Secre- and Serbia have been working towards the new Serbian government. tary Zsolt Nemeth told a recent confer- reconciliation since 2010 with the help “The time has come for autonomy Poland|Business ence on Hungarian-Serbian relations of the two countries’ top brass. to demonstrate what it is capable of in that the two countries are reconciling For instance, the presidents of both practice, Istvan Pasztor, chairman of Chinese entrepreneurs seek past differences. countries, Janos Ader (Hungary) and VMSZ, was quoted as saying. “Instead Addressing the conference, Tomislav Nikolic (Serbia), recently of creating tension in Serbian-Hungar- business contacts in Poland Nemeth said this is a “significant” paid tribute to those killed before and ian cohabitation, autonomy can func- A business delegation from China’s eastern city Qingdao process. “We have relations with during WWII in Curug Vojvodina. tion as a framework for it.” visited Warsaw on May 5 to promote cooperation in ener- neighbours, where the issue of col- Another factor reinforcing the Pasztor also stressed the leadership gy, machinery, IT and telecommunication, among other lective guilt has not been surmount- friendly relations between Hungary of Hungarian Serbs is making sure bi- fields. “When we invited our friends from Qingdao, we ed,” he explained. and Serbia is the Alliance of Vojvodina lateral relations unfold with real inten- primarily took into account the complementarities be- According to Nemeth, Hungary Hungarians (VMSZ), which is part of tions rather than mere words. tween the city’s economy and the interests of Polish en- trepreneurs,” said Slawomir Majman, head of the Polish Information and Foreign Investment Agency (PAIiIZ), POLAND |Eastern Ukraine during the meeting of Polish and Chinese businesses held in the capital city of Warsaw. The Chinese delegation, Polish OSCE observer recalls capture by Pro-Russian militants including Qingdao’s prominent companies: appliances One Polish military officer was among he said. “All around us, there were hun- Last week, a group of pro-Russian maker Haier, electronics producer Hisense and the Tsing- a group of OSCE observers released by dreds of men armed with knives, pistols militants stormed a Ukrainian police tao Brewery, represented the sectors of construction, real pro-Russian militants in eastern Ukraine and automatic weapons.” station in Odessa and released dozens of estate, electronics, refrigeration appliances, steel, decora- after being detained since April 25. Krzysztof and the other OSCE ob- activists who had been detained during tive products and energy management in the city, aimed According to Major Krzysztof Kob- servers had been captured in the town violent clashes with pro-Ukraine sup- to find partners for their IT solutions, automotive parts, ielski, who spoke to Polish TVN24, the of Kramatorsk, south of rebel-held Sla- porters. The incident was reportedly in textiles, footwear, health products, biotechnology and situation was very dangerous and could viansk. Among them was German Col. response to the death of 40 pro-Russian cosmetics at the meeting. (Xinhua) have taken a turn for the worse. Axel Schneider, who told the Associated activists who were killed in a blaze at a “When there was shooting we didn’t Press that the conflict in Ukraine has be- trade union building they had occupied speak, we just stayed lying on the floor,” come increasingly deadly. in Odessa. Slovakia|Energy

CZECH REPUBLIC |EU S lovakia affected with new Russian gas pipeline A decade later, Czechs still unsure about the EU Slovak gas-pipeline operator Eustream could lose a sig- Ten years after the Czech Republic vailed. But then, the crisis of the Eu- and moral standards. nificant part of its business in the next few years, Slovak joined the European Union, the coun- rozone put Czechs’ relations with the Richter also interviewed well- daily Hospodarske noviny reported on May 6. This is due try is still not feeling or looking any EU under strain. We have also seen known Czech commentator, Jiří Pehe, to the fact that the Russian gas company Gazprom has more European than before it joined public support for euro adoption slip who characterised this “a democracy agreed with the Austrian OMV to build the new South the coveted club, reports Jan Richter in significantly; now only about 20% of without democrats”. Stream gas pipeline to supply gas to the European Un- a special report for Radio Prague. Af- Czechs think we should adopt the sin- “I think that the EU has offered a ion. “With South Stream, the Russian side will be able ter all, it took the Czechs a whole nine gle currency. civilisation jump for the new member to bypass Ukraine and Slovakia,” said Tomas Marecek, years just to raise the EU flag at Prague However, Czechs’ attitudes to the countries of the former Communist the chairman of Eustream. At the moment, Eustream has Castle, which is a symbol of the coun- EU are multi-layered and we can’t say bloc. But what the EU might have un- some guarantee as the Russians have committed to use try’s history and sovereignty. they are unequivocally negative.” derestimated was the size of the gap, the Slovak pipeline until 2028. Nevertheless, it would Richter interviewed Jan Červenka, According to Richter, the am- so to speak, that still existed. Most of lose a large portion of profits to the competing pipeline. an analyst for CVVM, a polling agency biguous attitude towards the EU is those countries were not psychologi- Recently, the European Commission has been pushing affiliated with the Czech Academy of perhaps one of the reasons in some cally prepared to make use of the in- member states not to cooperate with the Russians on Sciences, who describes the Czechs’ areas the country has not improved stitutional know-how and other help the new pipeline project. By doing so, Brussels wanted attitude to the EU as lukewarm. so significantly, such as public admin- coming from the EU. But the process to force Moscow to settle the conflict with Ukraine. The “For the few years following the istration, the rule of law, civil society of creating democracy as a culture has Austrians nevertheless signed a deal with Gazprom. accession, positive attitudes pre- as well as the society’s general values been much slower.” (Xinhua) NEWEUROPE 20 www.neweurope.eu EUROPEAN UNION 11-17 May, 2014

CYPRUS|DIPLOMACY SPAIN|ECONOMY Merkel, Anastasiadis discuss Cyprus, energy ties Labour market shows more

Onsigns May 6, Spain’s of Prime Minisimprovement- ter Mariano Rajoy said new figures showed a record fall in unemployment in April but warned that the decline in the ranks of the unemployed in the economy was “absolutely insufficient”. The number of registered unem- ployed fell by 111,565 people from March to 4.68 million in April, the labour ministry reported. It was the steepest drop for the month of April German Chancellor Angela Merkel and Cyprus President since existing records began in 2001. Nicos Anastasiades address a joint press conference “I am hopeful about the future be- following a meeting at the Chancellery in Berlin May 6. cause I think we have broken a trend of AFP PHOTO/ODD ANDERSEN destruction of employment and we are On May 6, German Chancellor Angela Merkel ex- already heading in the opposite direc- pressed Berlin’s political support for the Cyprus talks tion,” Cadena Ser radio quoted Rajoy and vowed stronger engagement with the European as saying. “But we still have a lot to do Union to facilitate a settlement for the dispute over the because there are still many people divided island. “We are for progress in the UN process, who have not found work,” he added. Nissan’s employees work at the Japanese automaker plant in Barcelona on May 5. The as quickly and successfully as possible,” Merkel told re- “We managed to avoid a bailout number of jobless in Spain fell by 111,565 in April to 4.68 million. AFP PHOTO/JOSEP LAGO porters during a joint press conference with the visiting and believe me it definitely was not Greek Cypriot leader, Nikos Anastasiadis, in Berlin. “The easy, but at least we avoided what un- will grow more than France, than Italy, in the wider economy does seem to [Greek] Cypriot side is willing the EU’s stronger engage- fortunately happened to other coun- than Germany,” he said. “Overall the be feeding through to gains at service ment in this process. We agree with that and would offer tries,” the premier said. Spanish economy is quite a lot better,” providers in Spain,” Andrew Harker, support,” Merkel said. But she also underlined that the Rajoy pointed to the European Rajoy said. “The key thing is that there an economist at Markit, said in a sepa- main platform for the settlement talks would continue to Commission’s latest report last week is change in the trend,” he added. rate release on the country. “A pleasing be the UN. Anastasiadis began his four-day official visit boosting its forecast for Spanish eco- Meanwhile, Markit reported that aspect of the latest data is the rise in in Germany on May 6 with a meeting with Merkel. He nomic growth to 1.1% from 1% in 2014 service industries in Spain showed employment, with the labour market told reporters that his talks with Chancellor Merkel fo- and to 2.1% from 1.7% in 2015. “The the fastest growth since before the fi- having previously given little cause for cused on Cyprus, the Eurozone crisis and co-operation European Commission said that Spain nancial crisis. “Improving sentiment optimism.” in the fields of economy and energy. The geo-strategic importance of Cyprus offers closer co-operation with ROMANIA|HEALTH Germany in the field of energy, the Cypriot president said. “We would like to transform Cyprus into an energy hub. This may help decreasing dependence,” Anastasi- Romania has fewest doctors per 1,000 inhabitants in Europe adis told journalists at the joint press conference. “It can Some 15,000 physicians left Romania to healthcare systems. “Steps must be that the health ministry had launched also attract great attention in Germany.” Merkel hailed over the last seven years, causing the taken in this direction,” he said, add- a process to adapt the European cur- Anastasiadis’ efforts to overcome the economic crisis in country to have the lowest number of ing, “I think that Europe has to allocate ricula of resident doctors’ training. southern Cyprus. “I know how hard it is to take these doctors per thousand inhabitants in funds specifically for this. Europe, be- Health Minister Nicolae Banicioiu measures, particularly in terms of unemployment and Europe, Xinhua quoted State Secretary coming aware of this major issue, can has decided to appoint a taskforce to to structural change,” Merkel said. She added that Ger- Dorel Sandesc as saying on May 6. and must take compensation meas- find ways to increase physicians’ in- many would offer support for projects to assist small and “Recent statistics show that the ures. These mainly concern a specific, comes. According to the College of medium-sized enterprises. number of doctors dropped below 1.9 direct and massive allocation of funds Physicians of Romania, about 3,000 per 1,000 inhabitants, which is the low- for Romania’s healthcare infrastruc- doctors left Romania last year mostly est in Europe,” Sandesc told a press con- ture,” Sandesc said. for Germany, Britain and France. BULGARIA|INVESTMENT ference, stressing that Romania faced a The reason for Romanian physi- On average, a resident doctor in very serious deficit of medical staff. cians leaving to work abroad is not Romania earns €200, plus a grant Sofia tries to lure According to Sandesc, poor Eu- only related to money. It was also on worth €150, while in western Europe- ropean countries give rich countries grounds of poor working conditions in an countries, a resident earns on aver- solvent Arab tourists more than they receive when it comes hospitals, said the official, pointing out age €1,600. Bulgaria’s Ministry of Economy and Energy said the country “showed a new face with opportunities to at- PORTUGAL|ECONOMY tract solvent tourists from the Arab world”. This was demonstrated at the Arabian Travel Market. The tour- ism exchange was organised for professionals and takes Portugal’s clean exit from bailout draws mixed views place in Dubai on May 5-8, the press service said. The Portugal’s clean exit from its bailout an appropriate time to more effectively kets and enabled it to access Outright Bulgarian Ministry of Economy and Energy organised programme without the help of a pre- defend the interests of Portugal and its Monetary Transactions from the Euro- Bulgaria’s participation at the expo for a second year in cautionary credit line has drawn mixed people. However, former Finance Minis- pean Central Bank. a row. The Bulgarian stand is bigger this year and has an opinions after the government’s an- ter Miguel Beleza described the move as There were risks, but overall it was original design, the ministry said in a press release. The nouncement on May 4. “very risky”. “Portugal will have “very positive news,” Xinhua quoted list of Bulgarian participants includes the International The Portuguese government made no safety net now, meaning if there’s economist Joao Cantiga Esteves as holiday complex, Golden ands, Travel TSH, Profi Tours the decision after carefully weighing the any kind of problem, the country will saying. “We are still in a fragile state. and Orange Tour. Bulgaria’s Consul General in Dubai pros and cons, Prime Minister Pedro have to ask for another bailout,” Beleza Although lately we have seen some Angel Kalinov has also participated in the international Passos Coelho said in a televised speech said. A credit line would have helped positive indicators, there is still risk of exhibition. on May 4. He called it a right choice at ease Portugal’s return to the bond mar- international disturbances,” he said. NEWEUROPE www.neweurope.eu 21 11-17 May, 2014 ENLARGEMENT

TURK EY | Economy Albania|Taxes The taxman cometh, Turkish tensions bad for economy but not in Albania The Albanian government will keep a controversial pre- election promise and write-off a whopping €22m in unpaid taxes owed by businesses. While the measure is good news for some 4,000 entrepreneurs and is aimed at boosting eco- nomic activity, critics argue it will have negative knock-on effects. According to Arben Ahmetaj, Albania’s economic development, trade and entrepreneurship minister, the de- cision is a “promise kept’. He said the government will be able to forgive for a period of six months debts that were accumulated between March and September 2013. Ah- metaj said the government will forgive for a period of six months debts that were incurred from March to September of last year by 4,069 enterprises. The debt pertains to taxes or fines not paid in the amount of nearly €22m. The deci- sion is based on a law endorsed by parliament in mid-April, said Zamir Stefani, head of the legal department at the eco- nomic development, trade and entrepreneurship ministry. “With this law, taxpayers will face a new environment in conducting business - one that will provide the proper space they need to exercise their activity in Albania,” Stefani told SETimes. But experts like Zef Preci, executive director Critics called the effords of Turkish PM to ban Twitter and YouTube authoritarian and undemocratic. AFP PHOTO/ADEM ALTAN of Albanian Centre for Economic Research, are sounding The last time Turkey made international government‘s decision to overhaul the tion, told SES Türkiye. “Now the acute the alarm bell. “First, [the measure] will cost €22m that the headlines was when its prime minister, judiciary and restrict social media web- rise of authoritarianism makes all our Albanian citizens will pay for from their own pockets,” Preci Recep Tayyip Erdogan, tried to ban Twit- sites could have a long-term impact on problems deeper and blocks our energy told SETimes. ter and YouTube. Critics called the ban Turkey‘s global financial standing, which to solve them.” According to the credit authoritarian and accused Erdogan of try- has enjoyed strong growth for more than rating agency Moody‘s, Turkey’s econo- ing to prevent people in his country from a decade. my will contract 2.5% in 2014 due to the Albania|Investment seeing some rather incriminating evi- “It is true that there have been im- political turbulence and the upcoming dence against him - recordings that were portant economic and democratic de- presidential and general elections. In a Albania attractive anonymously posted on the internet. velopments in the last years. But those similar vein, the International Monetary Turkey is once again in the news with benefiting from these developments Fund (IMF) has warned the economy to Italian investors reports that political instability is damag- have always been a particular group of will grow by only 2.3% next year largely The first edition of the “Italian Week” kicked off on May 5, ing the country’s financial outlook. Ac- people,” Aydin Cingi, former president due to high interest rates and a drop in attracting some 170 Italian companies, reported the Alba- cording to a report in SES Türkiye, the of the NGO Social Democracy Founda- consumer spending. nian Telegraphic Agency. Italian Ambassador to Albania Massimo Gaiani said during the opening ceremony that Al- TURK EY |NGOs bania is of interest to Italian investors. “Italy has constantly supported Albania’s development during these 20 years and significant funds have been given in many sectors of cooper- TooThe good news many is that Turkey NGOs has made “Last in year Turkey only four associations are withoutcation and Solidarity; a Sanliurfa cause Yagmur ation such as infrastructure, communication or distribution it easier for its citizens to create non-gov- out of 883 submitted their projects and Education and Culture; Damla Women, of electricity, in favour of the connection of Albania with ernmental organisations (NGOs) by re- received 180,000 TL to fund these pro- Family and Children; and the Science the neighbouring countries,” said Gaiani. He said the Italian ducing the mandatory number of mem- jects,” Zeki Kaya, deputy head of the Culture Association. Cooperation in Albania has played a crucial role. “Equally bers these associations need in order to Sanliurfa Associations Assembly, told “The applications from the city and important has been and will be the relation in private sec- operate legally. The not-so-good news is SES Türkiye. “The only thing we can un- its surrounding towns are made with us. tor, which has contributed to achieving a high level of inte- that there are hundreds of groups lacking derstand from this is that the associations We have 883 active associations involved gration, especially of SMEs,” said the Italian diplomat. He substance and functionality, according to do not do their jobs. We have a prob- in building and rebuilding mosques, edu- said many factors attract the presence of Italian enterprises, a report published by the SES Türkiye. lem with representing the needs of our cation, culture, sports, solidarity, alumni. taking into account the labour force, production system In the south-eastern Turkish munici- civil society. The government is ready to We don’t know yet how many applica- between the two countries, geographical proximity and pality of Saniliurfa, for instance, officials help.” Only four NGOs have submitted tions will be done for 2014 but the gov- knowledge of the Italian language in Albania. (Xinhua) have registered 833 NGOs, but only few projects in order to apply for state fund- ernment set 20 million TL aside to fund are functioning. ing. These are the Eyvan Cultural Edu- these projects,” Kaya told SES Türkiye. Albania|EU ALBANIA |EU Albania, Poland sign deal on Fight against crime one of key EU requirement from Albania European integration The fight against organised crime will pends on your ability to set a success- the PAMECA mission and €6m for Albanian Foreign Minister Ditmir Bushati and his Polish be one of the key points of the Euro- ful record in the fight against organised new border crossings in Albania,” said counterpart Radoslaw Sikorski signed a memorandum pean Commission’s progress report on crime. This is one of the key points, Rumbold. of cooperation on European integration in Warsaw on Albania in June, Deputy EU Ambas- where the EC will focus in its June re- Last December, EU conclusions May 7, according to Albanian Telegraphic Agency. This sador to Tirana Clive Rumbold said port,” said Rumbold. determined that Albania should memorandum facilitates Poland’s contribution to Al- on May 6. Addressing a conference on He underlined the financial sup- strengthen measures to ensure respect bania’s EU integration process. Bushati called for an in- integrated border management, Rum- port the European Commission had for the law. Albania hopes to be granted tensification of bilateral relations and greater presenceof bold said sustainable results in this di- allocated to Albania in this regard. the EU candidate country status this Polish investments to Albania in areas such as tourism, rection were one of the EU’s main re- “More than €100m of European tax- summer, that would officially begin its energy, transport and agriculture. Sikorski said that Alba- quirements from Albania, the Albanian payers were channelled to Albania for journey to becoming a member of the nia deserves to obtain the EU candidate country status, Telegraphic Agency reported. law enforcement in seven years. A total 28-member bloc. reaffirming Poland’s stance to support Albania’s Euro- “Albania’s European future de- of €21m has been allocated through (Xinhua) pean aspirations. (Xinhua) NEWEUROPE 22 www.neweurope.eu ENLARGEMENT 11-17 May, 2014

SERBIA|ENERGY SERBIA| ENERGY NIS to drill wells on 4 Romanian blocks Belgrade, Moscow confirm Serbian oil company NIS will drill three wells on each of the four Romanian blocks for which the two companies jointly own concessions, Canada’s East West Petroleum Corp said on 7 May, SeeNews reported. NIS is the op- erator of the four blocks and holds an 85% interest, while SouthOn 6 May, Russia’s Foreign Stream Minister pipeline plans East West Petroleum owns 15%. NIS has informed East Sergei Lavrov and his Serbian counter- West Petroleum that it has recently issued tenders for part Ivica Dacic said their countries were seismic acquisition across the four licenses, East West ready to build the South Stream natural Petroleum Corp said in a statement. The drilling will be gas pipeline to Europe and confirmed part of the Phase I work programmes and will commence that Moscow and Belgrade had a com- following acquisition and interpretation. Under the farm mon view on the Ukrainian crisis. out agreement with NIS, East West will be fully carried “The talks confirmed the mutual de- through to commerciality, which includes all Phase I and sire to strengthen bilateral ties and press Phase II work on the concessions. NIS and East West will on with large-scale bilateral projects in be targeting conventional resources and all work will be the trade, economic and investment done in accordance with local and international regula- spheres, including the construction of tions and best practices, the Canadian company said. the South Stream gas pipeline,” Russia’s Foreign Ministry said on its webpage, fol- lowing the meeting between Lavrov and SERBIA|ENERGY Dacic on the sidelines of the Council of Europe’s Ministers Committee. Fintel Energia to build “We were pleased to note a certain Russia and Serbia reiterated their support for the €15.5-billion South Stream proximity and even coincidence of … pipeline designed to cut Russia’s dependence on the Ukrainian transit system. wind park in Serbia viewpoints that Moscow and Belgrade GAZPROM Italy’s Fintel Energia Group said its Serbian unit Energobal- share with regard to the key issues on the kan has received network approval from local grid operator European and global agenda. Particular Serbia’s long-term energy security and bia’s willingness to become an EU mem- Elektrovojvodina for its 6.6 megawatt (MW) La Piccolina attention was paid to the situation in the enable substantial progress in the na- ber, since the 28-country bloc was the wind park. The construction of the wind park started in Balkans and in Ukraine,” the statement tional economy,” Nikolic said on 6 May most significant trade partner for Russia January and with the connection approval the entire au- added. Russia annually pumps about 100 at a meeting with the speaker of Russia’s as well, the press service quoted Nary- thorization process is completed so that the works could be billion cubic metres of gas to European State Duma Sergei Naryshkin, who was shkin as saying. completed by the end of the year, Fintel Energia Group said countries via Ukraine, which makes up on a two-day visit to Serbia. Nikolic and Russian gas monopoly Gazprom in a filing to the Milan stock exchange. 80% of its total gas supplies to Europe. Naryshkin “expressed satisfaction with said it would announce the final South The €15.5-billion South Stream pipeline the level of co-operation between Ser- Stream route in summer. Gazprom is is designed to cut Russia’s dependence on bia and Russia, particularly with respect considering three routes for the project: BOSNIA-HERZEGOVINA|AIRLINES the Ukrainian transit system. to joint economic projects,” the Serbian through Bulgaria to Serbia, Hungary Meanwhile, Serbia’s President president’s press service said. and Austria; through Bulgaria to Serbia, Turkish Airlines inaugurates Tomislav Nikolic said he was interested “Russia has a correct understanding Hungary, Slovenia, Austria and Italy; or in intensifying work on South Stream. of Serbia’s position on the Ukraine crisis,” through Bulgaria and Greece to the south flights to Sarajevo “This is a project which should ensure Nikolic said. Russia also understood Ser- of Italy, according to RIA Novosti. On 2 May, Turkish Airlines inaugurated three weekly flights from Istanbul’s second airport, Sabiha Gokcen, to KOSOVO|POLITICS Bosnia Herzegovina’s Sarajevo Aiirport. The new service compliments Turkish Airlines’ existing eighteen weekly flights from Ataturk Airport. Celebrating the inaugural Kosovo calls early parliamentary elections for 8 June flight, Turkish Airlines said the new service will primarily Kosovo’s President Atifete Jahjaga has Kosovo’s Western supporters had Democratic League of Kosovo (LDK), cater for tourists. Sabiha Gokcen Airport lies in the Asian scheduled parliamentary elections for been reluctant to see the immediate crea- said after meeting the president: “Parlia- part of Istanbul which is home to some 45% of its citizens. 8 June. The announcement on 8 May tion of an army for fear of the message ment is not functioning any more... The “Turkish Airlines will continue to promote Bosnia and comes after deputies voted on 7 June to it might send to the more than 100,000 best way out is to hold elections in the Herzegovina both in Turkey and abroad. Bosnia and Her- dissolve the assembly, meaning elections ethnic Serbs who live in the country and first part of June, after dissolving the par- zegovina has become a new and alternative tourist desti- had to take place within 45 days. to Serbia itself. liament”. nation”, the carrier said. The early vote has been called after Officials have expressed hope the Plans to form Kosovo’s military are deadlock in Parliament on a number of early vote will bring more stability to the also opposed by Serbia, which has re- issues, including creation of Kosovo’s ethnically tense and economically im- jected Kosovo’s 2008 declaration of inde- MONTENEGRO|CRIME armed forces. That was opposed by the poverished state. pendence. Kosovo split from Serbia after Serb deputies, who sought more guaran- Earlier last week, Isa Mustafa, the a 1998-99 war. More than 100 countries Montenegro to remain tees for their minority. leader of the main opposition party, the have recognised its statehood.

dedicated partner of Interpol MONTENEGRO|DEFENCE Montenegro’s Minister of the Interior Rasko Konjevic paid his first official visit to Interpol, where he met with Sec- retary General Ronald K. Noble to discuss co-operation Montenegro expects NATO membership invitation between his ministry and the world’s largest international Montenegro’s Defence Minister Milica said Biden commended Montenegro’s ways been key to Alliance’s success. She police organisation, as well as other transnational security Pejanovic-Durisic said it is evident that his efforts and commitment in Euro-Atlantic noted they provide a viable framework matters, Montenegro’s government said in a press release. country has met the majority of criteria integration and noted that such results for tackling security challenges and should The meeting underlined a high level of mutual understand- required for NATO membership and ex- need to receive adequate recognition by be used as a basis for future enlargement. ing, support and cooperation which indicate that Monte- pects a membership invitation at the Wales the Alliance. Montenegro’s Defence Min- Pejanovic-Durisic stressed that the values negrin Ministry of the Interior and Police Authority are Summit. Pejanovic-Durisic met with US ister also discussed Articles 4 and 5 of the cherished by the European Union and credible and efficient partner in implementation of key ob- Vice-President Joe Biden in Washington North Atlantic Treaty, underlining that NATO are a solid basis for the vision of a jectives of Interpol, the Ministry has noted. DC late last month. Pejanovic-Durisic solidarity between member-states has al- Europe whole and free. NEWEUROPE www.neweurope.eu 23 11-17 May, 2014 PARTNERS

NORY WA |Economy Iceland|Fishing Icelanders in Washington Norway’s economic risks to learn about whales A delegation of museum and eco-tourism representatives from Iceland arrived in Washington last week for a 10-day fact-finding mission to learn about the science and policy predicted by OECD behind the non-lethal uses of whales. Their visit coin- cides with a memorandum passed by United States Presi- dent Barack Obama’s administration to encourage Iceland to explore the non-lethal uses of whales in order to end commercial whale hunting. Members of the delegation from Iceland scheduled meetings with representatives of US-based environmental NGOs. Their aim is to return with new ideas and strategy proposals to educate with Icelanders, including policymakers, about the new mar- kets and business opportunities concerning whales. The US State Department is also preparing to hold a virtual exchange event later this year with Icelandic participants on conservation initiatives.

Ny orwa |Media N ordic TV fund shows off new budget Television viewers in Iceland, Norway, Sweden, Denmark and Finland will have good reason to stay glued to their The natural gas-fired thermal power plant Karsto Power Station, at the industrial site of Karsto in Norway. BELGA PHOTO BENOIT DOPPAGNE TV sets this year. The Nordisk Film and TV Fund, which promotes high quality film and TV productions in the five Norway’s economy faces two risk factors when it comes to changing oil prices. As regards the real estate market – Nordic countries, has earmarked €52m to finance pro- that threaten its overall development, The OECD’s report describes the the second factor noted by the OECD, it ducers over the next five years. The fund, which is based warned the OECD in its latest Economic following scenario for Norway: the main- could also threaten Norway’s positive de- in Oslo, will invest the funds between 2015 and 2019, Outlook which was released on May 6. land economy will pick up in 2014 after velopment. Despite an expected growth spending an estimated €10m each year to help produc- These two risk factors, according to a slight decline. The driving force of the in the household’s disposable income, the ers distribute films, TV dramas and documentaries. The the Organisation for Economic Co-oper- petroleum industry will be weaker than in real estate investments will be weaker, the same amount (€52m) was allocated by the fund between ation and Development, are the price of the past years, but non-petroleum related OECD predicts. 2010 and 2014. Launched in 1990, the fund’s budget is oil and the real estate market. exports will pick up as the global econo- According to the OECD, the key in- provided by the governments, national film institutes and “The ripple effects from a weak oil my gets stronger. The growth in the main- terest rate should be increased towards broadcasters in each of the five Nordic countries. Accord- sector may be greater than expected,” the land economy is estimated to be 2.3% this the end of next year because total house- ing to Icelandic Culture Minister Illugi Gunnarsson, the OECD concludes in its report, which year and 2.8% in 2015 after a moderate hold spending will increase along with new round of funding will benefit regional TV series and also notes that the country is still volatile growth of 2% in 2013. people’s disposable income. films. Most recently, the fund backed the distribution of The Battle of the Heavy Water, a World War II resistance drama produced by Norwegian company Filmkamera- S WITZErland |Society tene, and The Team, a police drama by Denmark’s Nord- Jenish travellers demand a place to call home- for the summer isk Film Production. More than a decade after Switzerland’s for the winter. There are only 15 instead long-term solution for the Jenish com- Supreme Court recognised the right of of the 40 needed. Protesting against this munity, according to Swissinfo. Swit zerland|Prices travellers to suitable locations for their situation, dozens of nomadic Jenish peo- The president of the Bern govern- camps and ruled that these should be ple – a group that has enjoyed official mi- ment announced on May 6 that the can- N ew study shows Swiss taken into account as part of land-use nority status in Switzerland since 1998 ton planned to create three to five loca- planning, little has happened since then, – took to the streets of Bern to demand tions for the Jenish people to stay as well prices highest in the world according to a report in Swissinfo, the that more places made available to them. as two transit camps for foreign travellers. A new report published by the World Bank last week international branch of the Swiss Broad- In response, the cities of Bern and According to the report, up to 5,000 of the shows what the Swiss have known for years. Switzerland casting Corporation (SBC). Biel promised to each make available Jenish are travellers, who move from place is the most expensive country in the world, according to The court had ruled there should be sites where 50 caravans or mobile homes to place in Switzerland each summer, ped- the latest International Comparison Programme report. at least 80 transit areas, but there are only can stay until August. The two canton dling goods, dealing in scrap metal, or do- Compared to other countries, the Swiss pay high prices 45 at most. The situation is no better for Bern cities hope this temporary initiative ing odd jobs such as knife grinding, house for meat, fish and vegetables. According to the findings of locations where they are allowed to stay will give them time to find a medium to painting or working as tinsmiths. a similar survey published by the European Union’s statis- tics office Eurostat in 2012, consumer goods and services in Switzerland are up to 62% higher than the European NORY WA |Cooperation average. The World Bank’s report, which is published every six years, surveyed purchasing power and real ex- penditures in 177 countries using data compiled in 2011. Kazakhstan and Norway are exploringand NorwayFourth Vice President agree of the Norwe to- boostthe world’s most developed countries In the table for highest “price level indexes”, Switzerland ways to boost cooperation in areas of gian Stortinget (Supreme Legislature) by 2050. In turn, Schou stressed the tops the list, followed by Norway, Bermuda, Australia and sustainable development, good gov- Ingjerd Schou. importance of interfaith harmony and Denmark. Also in the top 10 are Sweden, Japan, Finland, ernance and human potential. These According to a press release is- ethnic tolerance. Luxembourg and Canada. The United States - the world’s issues were discussed in Oslo on May sued by Norway’s foreign ministry, the Schou also announced plans to cre- largest economy - ranks 25th. 5 between Ambassador of Kazakh- Kazakh ambassador spoke about his ate a “Kazakhstan - Norwegian group Ethiopia is at the very bottom of the list, below Myanmar, stan to Norway Askar Tazhiyev and country’s drive to join the top-30 of of friends”. Pakistan and Egypt. NEWEUROPE 24 www.neweurope.eu EASTERN PARTNERSHIP 11-17 May, 2014

BELARUS|FOOD MOLDOVA|EU AFFAIRS Belarus to ship milk powder to Venezuela Chisinau, Bucharest Belarus has signed a new contract to deliver full milk pow- der to Venezuela, Belarus’ Agriculture and Food Ministry reported. Three Belarusian companies, namely OAO Bel- discuss EU integration lakt, Lepel Plant of Dairy Products and Lida Dairy Can- On 8 May, Moldova’s President Nicolae nery, will export milk powder. According to the Agricul- Timofti met Romanian Senate Presi- ture and Food Ministry, in the first quarter Belarus shipped dent Calin Popescu-Tariceanu to dis- 1,000 tonnes of full milk powder to Venezuela. On the cuss Moldova’s European integration, whole Belarus exported 8,800 tonnes of full milk powder, namely, further signing of the Asso- including 7,500 tonnes to Russia, in January-March 2014. ciation Agreement, including the Deep Belarusian dairy factories started to export milk powder and Comprehensive Free Trade Area with vitamins to Venezuela in 2007. with the EU, Moldpres reported. In this context, Popescu-Tariceanu assured that Romania remained a sup- GEORGIA|DIPLOMACY porter of Moldova’s European cause. He also said that his country would play US Ambassador hails an active role in processes after signing of the Association Agreement, via po- Georgia’s European aspirations litical and diplomatic demarches at EU Georgia is taking leading steps towards European integra- level. tion, the United States Ambassador to Georgia Richard Timofti and Popescu-Tariceanu an- Norland said, Agenda.Ge reported. During his visit to Zug- alysed the stage of implementing joint didi, Norland met with the representatives of non-govern- projects in the economic, social and mental organisations and spoke about Georgia’s European cultural sectors. Moldovan President Nicolae Timofti addressed EU integration and the latest integration. The Ambassador noted the aspiration of Geor- They agreed to be identified new events in Ukraine. AFP PHOTO/MICHAL CIZEK gian people towards integrating with the European Union co-operation areas for the benefit of Timofti expressed interest in boosting also exchanged opinions about the lat- and wider European region had been strong for “quite a long citizens from both banks of the Prut. co-operation in media. The officials est events in Ukraine. time”. “Georgia tries to meet the criteria for integrating in Euro-Atlantic structures and displays considerable progress, BELARUS|DIPLOMACY so these figures are not at all surprising for me,” Norland said. The US official also commented on the recently adopted Anti-Discrimination law and said Georgian Parliament “re- Lukashenko, Medvedev address Eurasian Economic Union issues flected the will of voters” by approving the law. Russian Prime Minister Dmitry Med- gratulations to Belarusian veterans. He led by Yuri Ambrazevich, head of the vedev and Belarus President Alexander drew attention to the active develop- Central Office for Multilateral Diplo- Lukashenko met in Moscow on the eve ment of co-operation between the two macy, while the Russian delegation was MOLDOVA|TRANSPORT of Victory Day, with the latter saying that countries - within the Union State and led by Anatoly Viktorov, director of the between Minsk and Moscow there are the Customs Union - and also stressed Humanitarian Cooperation and Human Moldova resumes ticket sale no unsolvable issues. the importance of bilateral relations be- Rights Department. Luksashenko’s visit to Moscow was tween Belarus and Russia. During the event the sides discussed for train routes to Russia held on the eve of an important holiday In related news, scheduled con- topical issues on the international agen- The Moldovan railways state enterprise resumed the sell- for both countries - Victory Day. Lu- sultations between the Belarusian and da, the state and prospects of interaction ing of tickets for train routes to Russia after the date of 27 kashenko said that it unites the fraternal Russian foreign ministries took place in in human rights matters in the bilat- May, the Transport and Road Infrastructure Ministry said peoples. Today Belarus, Kazakhstan and Moscow at the level of the heads of the eral and multilateral formats. The sides in a press release. The Ukrzaliznita railways enterprise in- Russia are on the verge of an important divisions in charge of Belarus-Russia confirmed their unanimity with regard formed the Moldovan authority about the approval of the event - signing of the treaty establish- co-operation in human rights within to the human rights agenda within the schedule of trains movement and the re-launch of ticket ing the Eurasian Economic Union, Lu- the framework of international organi- framework of United Nations and other beforehand sale to all routes transiting Ukraine, Moldpres kashenko said. sations, BelTA quoted the press service international organisations. The sides reported. The ticket sale for Chisinau-Moscow and Chis- In his turn, Medvedev on behalf of of the Belarusian Foreign Ministry as agreed on future co-operation in these inau-St Petersburg routes were opened. After a previous the Russian government conveyed con- saying. The Belarusian delegation was matters. announcement by the Ukrainian authorities on the non- approval of railway schedules, the sale of tickets for trains’ BELARUS|DIPLOMACY routes from Chisinau to Russia was made until 27 May. Belarus, Chinese region to co-operate in agriculture ARMENIA|ENERGY Belarus and the Xinjiang Uyghur Au- facturing of agricultural equipment, to become its residents. tonomous Region of China are willing construction and production of build- Myatlikov informed that for several Tenran says it can supply to co-operate in agriculture and the ing materials, food processing and tex- years the BCCI has been organising manufacture of farm machines, Be- tile sectors, Organizing Committee of business visits to the exhibitions which gas to Europe via Armenia larusian Chamber of Commerce and the China-Eurasia Expo Chairman Xu are held in the city of Urumqi, the capi- Iran’s Deputy Energy Minister Ali Majedi has expressed Industry (BCCI) Chairman Mikhail Weihua said. tal of the Xinjiang Uygur Autonomous Iran’s readiness to export gas to Europe through Armenia, Myatlikov said, following his meeting He added that the Xinjiang Uygur Region. ISNA news agency reported on 7 May. Speaking about the with representatives of the Organizing Autonomous Region is home to spe- “Since this region accounts for a routes of exporting Iranian gas to Europe, the Iranian offi- Committee of the China-Eurasia Expo, cial economic zones, foreign residents large share of manufactured products cial said: “There are three gas export routes: one is via Tur- BelTA reported. of which are provided additional ben- in China, co-operation with enterpris- key, the second one is via Armenia, Georgia and the Black The parties discussed the main is- efits to perform business activities. es of the region is very advantageous Sea, and the third route lies via Iraq, Syria and Lebanon”. sues of trade and economic co-opera- For his part, Myatlikov stressed for Belarusian companies. For Chinese Iran’s Industry, Mining and Trade Minister Mohammad tion between Belarus and the Xinjiang that similar conditions have been creat- enterprises, in turn, this cooperation Reza Nematzadeh said recently the demand for natural gas Uighur Autonomous Region of China. ed in the Chinese-Belarusian Industrial opens up an opportunity to access the is increasing in Europe, while Iran wants to play an impor- The most promising areas of co-oper- Park, and invited the companies of the market of the Customs Union and the tant role in European fuel supplies. ation, include agriculture and manu- Xinjiang Uygur Autonomous Region markets of western countries,” he said. NEWEUROPE www.neweurope.eu 25 11-17 May, 2014 RUSSIA

RUSSIA|POLITICS RUSSIA|ECONOMY Russia to allocate over Putin bans F-Word, $19 million for Crimea The Russian government will set aside 7.085 billion ru- bles ($19 billion) to finance transport infrastructure ser- vice in Crimea in 2014, the official Russian government obscenity in mass culture website said on 7 May. The decree allocating subsidies from federal budget has been signed by Russian Prime By Kostis Geropoulos Minister Dmitry Medvedev. Subsidies and inter-budg- A new law signed by Russian President etary transfers will be allotted particularly for passenger Vladimir Putin will put roubles in the traffic to Crimea and back, construction and overhaul of country’s swear jar. The Kremlin chief Simferopol airport, reconstruction of the maritime rail- signed a law on 5 May prohibiting swear- way and motor ferry line at the Crimean seaport of Kerch. ing in public performances, including Subsidies and inter-budgetary transfers will be also used cinema, theater and other forms of art. to make air passenger traffic to Simferopol and back ac- The law will come into effect on 1 July, cessible, fund “road activity on highways of regional, and afterwards swearing in films, plays inter-municipal and local importance” in Crimea and op- and concerts will incur penalties. eration of the Crimean state-run railway, the decree said, Individuals caught using foul lan- cited by Itar-tass. “Allocations will be made from budget guage face a fine of up to $70, while assignments envisaged for the Finance Ministry to fund officials can be fined up to $40 and additional measures to support economy, small and me- businesses nearly $1,400. They face a dium businesses, labour market, mono-profile municipal higher fine and a three-month suspen- entities and social support of people. The decree permits sion of business for repeated offenses. Russia’s President Vladimir Putin attends a press conference in the Kremlin in Moscow, to improve transport provision in the Crimean Federal An independent examination will de- 7 May 2014. The Kremlin leader signed a law on 5 May prohibiting swearing in public District that is particularly important in a season of vaca- termine what counts as profane lan- performances, including cinema, theater and other forms of art. tions with higher passenger traffic. Russia’s ability to keep guage, Itar-tass reported. AFP PHOTO/POOL/SERGEI KARPUKHIN Crimea’s tourism industry flourishing is of huge impor- Any new film containing obscene of four words of Russia’s “mat” - a term passed measures will only concern tance to the peninsula, whose economy depends heavily language won’t be granted a distribu- for strong obscene profanity in Rus- mass culture and will not concern art. on the millions of tourists that visit it each summer. tion certificate, so there’s no chance of sian - that will be banned. Mat has a Culture Ministry spokesperson Irina seeing it at the movie theater. long history in poetry, parody, and po- Kaznacheeva argued that the law’s only And copies of books, CDs or films litical speech. Two words depict male aim is to regulate this sphere, “so that RUSSIA|TRANSPORT containing swearing can only be dis- and female genitalia, one is the Russian swearing will have its purpose”. She add- tributed in a sealed package labeled equivalent of the F-Word and the last ed that it will be up to the artistic direc- Moscow public transport “Contains obscene language,” the refers to a promiscuous woman. tor to decide what to do with swearing, Kremlin said in a statement. The most recent law has not yet whether to break the new law or not, we faces price increases A similar measure was passed in specified a list of specific curse words. will not interfere in the process. Public transport in Moscow will become 5-7% more ex- April 2013, banning swearing in media. According to the Culture Ministry, Critics see this as the latest step un- pensive starting June, City Hall said on 6 May, the Mos- In December 2013, the Institute which is in charge of overseeing the der Putin’s leadership to limit freedom cow Times reported. The new pricing structure takes into of Russian Language at the Russian work of theaters and also issuing mov- of expression and promote a conserva- account the increase in residents’ wages and inflation, the Academy of Sciences compiled a list ie distribution certificates, the newly tive, nationalist viewpoint. Moscow transportation department said in an online state- ment. The price of a five-trip metro ticket will rise from 150 RUSSIA|TRANSPORT rubles to 160 rubles ($4.2-4.5), 20-trip tickets will increase by 40 rubles to 540 rubles and 60-trip tickets will jump from 1,200 rubles to 1,300 rubles. The so-called 90 minute ticket, China may help build transport corridor to Crimea which allows for one trip on the metro and an unlimited China International Fund Ltd (CIF) number of trips on surface transportation within this time and China Railway Construction Cor- period, and combined tickets for bus, tram and trolleybus poration (CRCC) may be invited to rides will also be subject to price rises. However, the price of participate in constructing a transport Troika tickets, which incorporate all three of the aforemen- corridor to Crimea across Kerch Strait tioned types of ticket, will remain the same in June, as will while part of investments in the $1.2- the price of regular one and two-trip tickets. 3 billion project will be made in yuan, Kommersant reported on 5 May. Quoting sources close to the Rus- RUSSIA|TRANSPORT sian Ministry of Transport and the Av- todor the state-run Russian Automo- Russian Railways asks bile Roads Company, the newspaper said companies from China will be the for more government support first foreign investors in the economy Russian Army engineers unload a section of pontoon bridge in the Crimean port city Russian Railways said in its strategy that it will not be able of Crimea following Russia’s annexa- of Kerch, 5 May 2014. Russian Army engineers started on 4 May construction of an to stay profitable and compete with other means of trans- tion of the peninsula. additional ferry line between port Kavkaz in southern Russia’s Krasnodar territorial city of port without substantial government support, Vedomosti The Transport Ministry is report- Temryuk and port Krym in the port city of Kerch on the peninsula of Crimea annexed by reported. The document, which envisages the monopoly’s edly preparing to conclude with Chi- Russia in March. AFP PHOTO/YURIY LASHOV strategy until 2030, was published two weeks ago along with nese companies a memorandum on The memorandum may be signed be implemented, whereas final decisions the financial results for the first quarter under the Russian building a transport corridor across the during Russian President Vladimir Pu- on parties to the project will be made af- accounting standards. The strategy calls for government Kerch Strait which will connect south- tin’s visit to China in the second half ter certainty emerges as to how precisely support, increased tariffs or a reduction of the rail network in ern Russia’s Krasnodar Territory and of May, the daily sources said. China’s the transport corridor will be built. order to improve the company’s long-term financial health. Crimea. A technical blueprint of the CIF is expected to fund the project and Analysts say this is primarily a po- Russian Railways reported a first-quarter net loss of more project is not approved yet, as this may CRCC will build it. litical step which shows increasing rela- than 10 billion rubles ($278 million) over the first three be a combined motor-railway bridge or The Transport Ministry is reported- tions between Russia and China amid months of 2014, compared to net revenue of more than 10 a bridge and an underwater tunnel. ly analysing how exactly the diagram will Western sanctions. billion rubles a year earlier. NEWEUROPE 26 www.neweurope.eu EURASIA 11-17 May, 2014

Turkmenistan|Afghanistan KAZAKHSTAN | Investment Turkmenistan extends helping hand to Turkmen tribes in Afghanistan Kazakhstan to court foreign investors For the first time in years, Turkmenistan is reaching out to Afghan Turkmen settled in villages on the Afghan side of the border. Last month, a special Turkmenistan delegation with generous tax exemptions visited the Khamyab district on the Afghan side to speak Foreign investors will be exempt from with the Turkmen locals. Many reportedly complained the corporate taxes for 10 years and new rising Amu Darya River is destroying their arable land and legislation will streamline hiring rules forcing them to move further inland in the desert. In re- for overseas workers, according to an sponse, Turkmenistan's Foreign Minister Rashid Meredov announcement made by Kazakhstan’s announced plans to help stop the Amu Darya by building a President Nursultan Nazarbayev dur- retaining wall along the 30km off the Amu Darya bank in the ing the 47th annual meeting of ADB Qarqeen district and another 16km in the Khamyab district. Board of Governors in Astana. The minister also promised to resolve the issue over the use "We intend to create the most ap- of the islands. Meredov said the government would allow propriate ground for foreign invest- the Afghan Turkmen to bring their cattle to graze on one of ments,” said Nazarbayev. the large islands. Meanwhile, it remains unknown whether “To this end, we will adopt a new Turkmenistan will agree to release Afghan Turkmen impris- law to improve investment laws this oned in Turkmenistan after being caught on these islands. year. We plan to exempt investors from corporate income tax for 10 years, to input investment subsidies, to ensure a Uzbekistan|Taxes stable legislation and predictable tariff and to simplify import of foreign la- Tax-friendly measures for bour. "In addition to the institute of in- vestment ombudsman,” he added, “we Kazakhstan’s President Nursultan Nazarbayev offers low taxes for foreign investors. Uzbekistan business owners will pursue inclusive economic growth EPA/YURI KOCHETKOV POOL The government in Uzbekistan has made a big announce- and increase investment in human cap- ment for the country’s small business owners. Tax officials ital development.” country. "We have identified about 160 expect to hear about new projects of reported on May 1 that a series of new measures will make According to Kazakhstan’s Deputy transnational companies which have major companies in the second half of it easier for entrepreneurs to do business. Under the new Prime Minister and Minister of Indus- the best technology and experience in the year.” measures, all government offices, including public utility try and New Technologies Asset Iseke- the priority areas, including engineer- According to Isekeshev, even global companies and municipalities, will be required to post busi- shev, officials are currently reviewing ing, agriculture, transport and logistics, giant Toyota Motors has announced it ness rules on their official websites. If a rule or regulation is applications submitted by transnation- chemicals and petrochemicals, as well is planning to manufacture cars in Ka- not posted online, an entrepreneur will not be held liable al companies wishing to operate in the as metallurgy," Isekeshev said. “We zakhstan. for not implementing it. What is more, tax officials assigned to inspecting small businesses will take a break until 2017. Turkmenistan |Cooperation While these are all good rules and widely welcomed by Uz- bekistan’s growing number of entrepreneurs, critics argue the government has not fully addressed the biggest prob- Multi-level cooperation agreements unite Turkmenistan and Tajikistan lem faced by small businesses: their interactions with the Turkmenistan’s President Gurbanguly Other issues tabled during the two- tourism, and a two-year programme for various government agencies due to the bureaucracy and Berdymukhamedov's visit to Tajikistan day meeting included the ambitious trade and economic, cultural and hu- red tape. According to the official data, 5.8% of the coun- on May 5 and 6 marked a new chapter construction of the Turkmenistan- manitarian cooperation for 2014-2016. try’s GDP last year was generated by private businesses. for relations between the two countries. Afghanistan-Tajikistan transnational The foreign ministries of both This is 1.2% less than in 2012. Data compiled by Uzbeki- The two countries agreed to extend railway, as well as projects in the energy countries also signed a cooperation stan’s official statistics agency suggest that small businesses cooperation in various fields, including sector, power engineering and agricul- agreement for 2015 and a memoran- are responsible for a third (33.6%) of the country’s total political, trade-economic, cultural and ture. dum on cooperation between the GDP last year, slightly down from 33.9% in 2012. As re- humanitarian. Numerous issues were A number of bilateral agreements institute of state and law under the gards the ease of doing business, the World Bank’s annual discussed at length during a meeting be- were also signed by the two presidents. president of Turkmenistan and the Na- 2014 index showed that Uzbekistan moved up 10 positions tween Berdymukhamedov and his Tajik These include an agreement for the con- tional Centre of Legislation under the from 156 to 146 out of a total of 189 economies. counterpart, Emomali Rahmon. They struction of a secondary school named president of Tajikistan. An agreement even discussed the settlement of the after Magtumguly in Dzhulikul district for cooperation between the Turkmen situation in Afghanistan, agreeing that of Tajikistan, an agreement on coop- State University, which is named after Uzbekistan|TURKPA diplomacy must prevail for a peaceful eration in the field of transport, another Magtumguly, and the Tajik National solution to the conflicts in Afghanistan. agreement on cooperation in the field of University was also signed. U zbekistan, Turkmenistan UZBEKISTAN |Cooperation may join TURKPA Azerbaijan, Kazakhstan, Turkey and the Kyrgyz Republic could soon welcome to new members to their Parliamen- AJapan, visit to Uzbekistan Uzbekistan last week by Japa- eral billionagree dollars into financial boost aid to technicalcooperation assistance, a number of so- tary Assembly of Turkic Speaking Countries (TURKPA). nese Deputy Prime Minister and Fi- Uzbekistan, supporting a long list of cially significant and infrastructure Uzbekistan and Turkmenistan are destined to become nance Minister Taro Aso brought the infrastructure projects in the health, projects in the health, education, ener- members, according to TURKPA Secretary General Jan- two countries closer together. education, energy, transport and tel- gy, transport, telecommunications and dos Asanov, who made the announcement last week during Building on 12 years of friendly ecommunications sectors. other sectors are being implemented in a meeting of the Assembly Committee on Legal Affairs in diplomatic relations, the two coun- As regards business relations, Uzbekistan. Astana. Established in 2008, the goal of the TURKPA is to tries agreed to work together to further about a dozen joint Uzbek-Japanese Japanese investors are currently promote dialogue between the member countries through develop the energy sector, mining, oil companies have been established and involved in a number of projects, in- parliamentary diplomacy, legislative harmonisation and and gas, chemical and electrical indus- 14 offices of Japanese companies are cluding the electrification of the Kar- strengthening of parliamentary cooperation on the basis tries, car production and telecommu- accredited in Uzbekistan. These in- shi-Termez railway line, the expansion of historical, cultural and linguistic unity, as well as mutu- nications. Currently, the trade turno- clude the Japanese corporations Mit- of Navoi thermal power plant and the ally beneficial and equal cooperation between the Turkic ver between the two countries exceeds sui, Mitsubishi, Itochu and Marubeni. modernisation of Uzbekistan’s Talima- speaking nations. $215m. Japan has also provided sev- Thanks to Japan's financial and rjan thermal power plant. NEWEUROPE www.neweurope.eu 27 11-17 May, 2014 EU-ASEAN

Myanmar|ASEAN Singapore|Taxes Interview: Singapore, U.S. cut deal to combat non-compliance China, ASEAN to work for new with U.S. tax laws Singapore has “substantially” concluded the discussion progress in ties: Chinese Ambassador with the United States on an intergovernmental agreement China and the Association of South- that aim at preventing tax evasion by U.S. citizens, perma- east Asian Nations (ASEAN) are at a nent residents and entities, the Monetary Authority of Sin- new starting point for closer relations gapore, the city-state’s Ministry of Finance and Inland Rev- and both sides are willing to seek new enue Authority of Singapore (IRAS) jointly announced on progress in their strategic partnership, Tuesday. The agreement requires Singapore-based finan- Chinese Ambassador to Myanmar cial institutions to comply with the so-called U.S. Foreign Yang Houlan said. Account Tax Compliance Act (FATCA). The Act, which It’s time the two sides deepen their is set to take effect on July 1, targets non- compliance with practical cooperation for mutual ben- tax laws by U.S. persons using overseas accounts. Under efits, Yang told Xinhua in an exclusive the FATCA, all financial institutions outside of the United interview on the eve of the ASEAN States are required to regularly submit information on fi- Summit to be held in Myanmar. nancial accounts held by U.S. persons to the U.S. Internal Yang said China and ASEAN are Revenue Service. Singapore and the United States have close neighbors sharing cultural simi- initialed a Model 1 intergovernmental agreement. It means larities and common interests, which that Singapore-based financial institutions will report infor- make them cooperation partners. mation on financial accounts held by U.S. persons to the China is the first major country out IRAS, which will in turn provide the information to the of the region that joined the Treaty of U.S. Internal Revenue Service. “Transmitting this informa- Amity and Cooperation in Southeast tion through IRAS helps to ease the compliance burden Asia and is also the first country which for our financial institutions as their reporting obligations Trucks loaded with teakwook queue for load to the ship at Yangon Port. The trade has established strategic cooperative would be deemed met once they have transmitted the in- between the two countries increased 28.3% on year to $10.15bn in 2013 partnership and free trade area with formation to IRAS,” the joint statement said. Another repu- ASEAN. trade area, promoting infrastructure In this regard, the two sides should table wealth management center, Swiss, had also signed Over the past decade which Yang construction for further connectiv- keep communication in terms of poli- similar agreement with the United States, but it was under described as “golden years” in China- ity, enhancing financial cooperation cy making and give priority to realizing Model 2. This kind of model requires that foreign financial ASEAN cooperation, bilateral trade against risks, steadily pushing forward road connection, ensuring free trade institutions directly report the account information to U.S. increased by five fold to $400bn at pre- maritime cooperation, strengthening and currency flow while promoting Internal Revenue Service based on a declaration of consent sent, while two-way investment went security cooperation and expanding people-to-people communication and of the account holder. Following the initialing of the inter- up by three fold to more than $100bn. exchange in the fields of culture, sci- exchange. governmental agreement, Singapore and the United States China has become ASEAN’s biggest ence and technology and environmen- As for the relations between China expect to sign the agreement in the second half of this year. trading partner, while ASEAN has tal protection. and Myanmar, Yang expressed appreci- Foreign financial institutions that do not comply with FAT- also become China’s third largest, and The ambassador expressed the ation for the development in their po- CA will face a 30 percent- withholding tax on certain pay- comprehensive cooperation has been hope that the two sides could reach a litical, economic, military and cultural ments made to them from the United States. (Xinhua) developing at various levels. consensus and sign a treaty of amity cooperation over the recent years. Yang stressed that the 10 years’ ex- and cooperation at an early date as it Citing Chinese data, the ambas- perience has fully shown that China would provide a legal and institutional sador said that trade between the two Vie tnam|Dien Bien Phu and ASEAN are in a “community of guarantee for China-ASEAN strategic countries increased 28.3% on year to common destiny” as their increas- cooperation. $10.15bn in 2013, when China’s total Victory of Dien Bien Phu ing mutual trust and cooperation has He said the two sides should work investment in Myanmar, including that brought phenomenal benefits to coun- together for a higher version of the from Hong Kong and Macao, exceeded Campaign immortal tries and people in the region. China-ASEAN free trade area and $21bn, making China Myanmar’s larg- Currently, Yang said, both China strive for a bilateral trade of $1trillion est trade partner and source of foreign epic of Vietnam and ASEAN are at a stage of rapid in- by the year 2020. investment. The historic victory of Dien Bien Phu Campaign is an im- dustrialization and urbanization. The The year 2014 also marks the “Year In July 2013, the China-Myanmar mortal epic of Vietnam derived from the wise leadership year 2014 marks the start of the sec- of China-ASEAN Cultural Exchange” natural gas pipeline was put into opera- of the Communist Party of Vietnam, President Ho Chi ond decade of China-ASEAN strate- and China has decided to offer 15,000 tion, becoming the latest achievement Minh, General Vo Nguyen Giap and the strength of national gic partnership. The two sides should quota of government scholarships in the two countries’ mutually benefi- unity and the determination to fight for independence and continue to seek new strategic break- to students from ASEAN member cial cooperation. freedom of Vietnamese people. The remark was made by throughs in the future and deepen countries and establish more ASEAN- Yang reiterated that China’s Myan- Vietnamese President Truong Tan Sang at a parade held in their practical cooperation for new oriented education centers in China in mar policy remains firm, transparent Vietnam’s northwestern Dien Bien province, some 300 km progresses. the next three to five years, Yang said. and sincere, stressing China is looking west of capital Hanoi, to celebrate the 60th anniversary of To this end, Yang cited Chinese China will continue to support forward to a peaceful, stable, develop- the victory of Dien Bien Phu Campaign. The victory of Dien Premier Li Keqiang’s proposals last the building of cooperation platforms ing and prosperous Myanmar, which Bien Phu Campaign is the victory of the solidarity between year as a guideline. such as China-ASEAN center, China- is not only in the interest of the Myan- Vietnam, Laos and Cambodia, putting an end to the ruling At the 10+1 summit held in Brunei ASEAN think-tank network, China- mar people but also of China and the of colonialism in Indochina and all over the world, said Sang. last October, Premier Li put forward a ASEAN public health cooperation other countries in the region. Sixty years have passed, the victory of Dien Bien Phu Cam- two-point consensus and seven-point fund to lay a solid foundation for fur- As close neighbors and important paign will forever be a milestone in the glorious history of Vi- proposal to further China-ASEAN re- ther cooperation. cooperative partners, China and My- etnamese people, encouraging Vietnamese party, state, and lations, including deepening strategic He said China is ready to strength- anmar have no better choice but to people in the cause of building and defending the country, mutual trust and focusing on econom- en maritime cooperation with ASEAN maintain their friendly ties, he said, Sang said. After nearly 30 years of the reform career, Vietnam ic development for greater benefits, countries and work with them to build adding that as long as the two coun- has gained remarkable achievements in socio-economic de- exploring a treaty on good-neighbor- a new maritime silk road in the 21st tries continue their fine tradition of velopment. However, the development is still not commen- liness, friendship and cooperation be- century, as Chinese President Xi Jin- equality, mutual trust and cooperation, surate with the potential of the country, Sang said, calling the tween the two sides, initiating talks ping proposed during his visit to Indo- they will have a brighter future for co- entire country to further promote the spirit of Dien Bien Phu on upgrading the China-ASEAN free nesia last October. operation. (Xinhua) victory to build Vietnam a prosperous country. (Xinhua) NEWEUROPE 28 | 1080 LA LEGGE E’ UGUALE PER TUTTI 11-17 May, 2014 D&G was sentenced to one and a half year (suspended sentence) for tax evading €200 m. Silvio Berlusconi, 10 years Prime Minister, after 110 trials (!), was sentenced to 4 years for evading € 6 m. … KASSANDRA Oh mia patria sì bella e perduta! [email protected] Follow me on twitter @Kassandra_NE

n 25 DoMay next, the European you trust this man? voters will for the first time have their say in the appointment of Othe Commission president. However, the likelihood that this would improve the ‘corporate governance’ of the EU Commission is nil. The European citizens will remain as powerless as today against the appointment of the members of the future Commission to the various portfolios. As today, they will continue to suffer the consequences of inadequate policy decisions taken by below average politically appointed Commissioners. A recent illustration of such inadequate decision is the green light given end last year by the Commission’s Vice-President in charge of competition policy, Joaquín Almunia, to a merger between both Greek airline companies at the time, Olympic and Aegean, creating a monopoly on domestic routes in Greece.

The U-turn of Joaquin Almunia

Three years ago, end January 2011, AFP PHOTO / JOHN THYS Joaquín Almunia blocked an attempted merger between Olympic Air and Aegean, given Olympic’s own very difficult financial David Anderson from the law firm Berwin to 4.6% of GDP. The following year, the after nearly a year of discussions. The situation, Olympic would be forced to leave Leighton Paisner says that Olympic- country’s deficit reached 6.6% of GDP. Commission said that the merger would the market soon in any event. Therefore Aegean merger is only the second merger But what did Joaquín Almunia do beyond create a “quasi-monopoly” in Greece and we approved the merger because it has no approved by the EU Commission on the correcting statistics? Beyond observing, as that the merger would have led “to higher additional negative effect on competition.” “failing firm” reasoning. Moreover, the he did in a speech in Athens on 5 October fares for four of the six million Greek and It was like a criminal court acquitting Olympic-Aegean merger is the first merger 2005, “the determination and commitment European passengers flying to and from a murderer of a cancer patient on the ever cleared on a second attempt. of the Greek government to restore fiscal Athens each year”. But surprise surprise, grounds that since the victim was anyway Aegean’s team of lawyers who obtained discipline and speed up the reforms in order to two years later Joaquín Almunia made going to die, the murderer had caused “no the Commission’s approval for the Greek be better equipped in the face of the new needs a U-turn, on the basis of an astonishing additional negative effect”. carrier acquisition of its rival Olympic Air, of our modern and open societies”? Today reasoning. This being said, Joaquín Almunia lead by Mark Powell and Dr Assimakis and for many years, the Greek population After years of mismanagement under did not come back on its finding of 2011 Komninos, both from the International pays and will continue to pay for the inertia successive socialist governments, Olympic that six million Greek and European law firm White & Case, therefore proudly of the Spanish EU Commissioner when in was privatized in 2009. At that time, it was passengers flying to and from Athens issued a press release stating that “While the charge of Economic and Financial Affairs. costing the Greek taxpayer about €1,500 a each year will have to pay higher fares. He decision should be viewed in light of the current But President Barroso rewarded him in day. The new owner could however never said that not the merger but the difficult economic context in Greece, it nonetheless 2009 for his handling of the Greek file – had turn the tide and transform Olympic into a financial situation of Olympic would be represents a first for EU merger control”. Joaquín Almunia not successfully ensured profitable company. This was already clear in the cause. In addition, Joaquín Almunia This being said, the only information that no one blamed the Commission for 2011. But this time the owner of Olympic stressed that due to its financial difficulties currently available on the reasoning of what happened? – with a promotion as could convince Joaquín Almunia that if Olympic had already closed a number the EU Commission is that in the press Commissioner in charge of competition, the latter did not approve the merger, the of routes. In 2011, Aegean and Olympic releases from the Commission and the one of the most powerful and sought after former would pull the plug out, creating provided competing services on 17 routes. lawyers of Aegean, since the Commission positions in the Commission. further social unrest in Greece and raising When the Commission approved the has not yet made public the wording of its animosity against the EU. merger between Aegean and Olympic, decision of 9 October of last year. Happy pensioner However, Joaquín Almunia needed to they had overlaps on seven routes only, of find a legal justification for its U-turn, what which the following five domestic routes Not the first file Joaquín Almunia will be 66 at the end he did not fail to do with the help of the are served only by them: Athens–Chania; of the year and will likely retire when brilliant in house lawyers employed in the Athens–Mytilene; Athens–Santorini; The Olympic-Aegean merger is not the leaving the Commission. Contrary to so well staffed Commission legal service. The Athens–Corfu; Athens–Kos. Why would first file for which Joaquín Almunia will be many pensioners in the EU who have seen legal argument sounds: Olympic will go the Commission risk causing new social remembered in Greece when he retires at their pensions cut under the EU promoted out of business and once Olympic will be turmoil in Greece for a few Greek routes. the end of this year. austerity, he will as former Commissioner out of business; Aegean would become the After all, Greeks and tourists can also Greeks do not forget that soon after receive an EU pension of more than only significant domestic service provider take the ferry if they find the plane too Joaquín Almunia’s appointment on 26 10.000 Euro per month, with the low EU and thus acquire a monopoly. Conclusion: expensive. April 2004 as European Commissioner for tax. He will accumulate this pension, with since Olympic would anyway disappear Economic and Financial Affairs, the news no reductions, with his national pension as a competitor on the Greek market, the The dressing up came out that Greece had been reporting as a MP (during 25 years) and minister. If merger caused no harm to competition souped-up deficit figures every year since he ever visits Greece and flies from Athens that would not have occurred anyway. Clearing a merger on grounds of the 1998 in order to flout the Stability and to Corfou, he will likely hardly suffer from Joaquín Almunia, explained: “It is clear “failing firm defense” – as the reasoning Growth Pact. The Greek budget deficit the souped up tariffs from the monopoly that, due to the on-going Greek crisis and is known by lawyers –is very unusual. for 2003 was revised upwards from 1.7% that he brought about. www.neweurope.eu NEW EUROPEMay 2014

The Assembly of European Regions a partner for regional growth The AER Business Community he business world has changed. Today, there are no borders and no currencies. The definition of “Tcompetitiveness has also evolved; we can’t boost enterprises through the traditional an- nual fairs or other old-fashion tools. We need to encourage regional business and small and medium enterprises towards a constant Giovanni Chiodi, dialogue with their counter partners and in- troduce them to new stakeholders. Therefore, President of the it is with great honour that I accept to be in Abruzzo Region charge of the AER Business Community”. This statement byGiovanni Chiodi, Pres- (IT), took officially ident of the Abruzzo Region (Italy), got the attention of New Europe. Throughout the charge of the this supplement we will focus our atten- “AER Business tion on how to get new business opportu- nities without the European Commission Community” in support, neither National Governments but through regional authorities. Pescara in For those who don’t know this associa- April 2014. tion, established in 1985, the Assembly of European Regions is the largest indepen- dent network of regions in wider Europe. In fact, AER brings together nearly 230 touch with new markets and to extend their – whose vision is to be the world leader in region’s growth, by highlighting its eco- regions from 35 countries and 15 inter- network at the regional level. A level consid- sustainable transport solutions – welcomes nomic assets and innovative businesses. regional organisations. All regions within ered by AER as very accessible and flexible, the opportunity to cooperate with the As- One part will also be dedicated to educa- Council of Europe states can join this making it a privileged interlocutor for grow- sembly of European Regions. This experi- tion. A student will guide the viewer, invit- network. Regions are defined as authori- ing business. This Community is composed ence will provide us with a better insight of ing him or her to visit the university world ties immediately below the level of central on the one hand of a privileged pool of co- regional mobility challenges and transport and meet foreign students. government, with a political power of rep- founders and other members from the pri- needs so that, together, we will be able to de- The end of each episode will highlight resentation, as embodied by an elected re- vate sector. On the other hand, it gathers dy- velop sustainable European Regions” stated the different modes of transportation and gional Assembly. In the past few weeks, we namic, open-minded and innovative SMEs Frédérique Biston, Vice-President of infrastructure available in the area, such got to know its current views through its that are looking for internationalisation and Volvo Group. as regional airports, high speed trains, etc. Secretary General, Pascal Goergen and new markets. Some concrete projects have already The aim of “European Regions” is to en- we’ll soon have a chat with its President, All of these companies are included in come out from these partnerships, such as courage familiarity and dialogue between Hande Özsan Bozatli, who is also the AER’s activities where they can find op- the “European Regions” campaign, brand- cultures as well to promote tourism and Vice-President of the Metropolitan area of portunities for interregional economic ed by AER and led together with UNICAP discovery of the highlighted region. “Eu- Istanbul. exchanges, share best practices and inno- Television. ropean Regions” will also lead the view- This Assembly launched its Business vative ideas, as well as improve their cor- “European Regions” will be a series of ers to a wealth of undiscovered culture. Community last 8 April 2014. The main porate image and reputation. documentaries inviting television viewers With its unusual places and memorable purpose is to establish concrete and sustain- Today, it can already rely some co- to discover a region through its heritage, interviews. able links between the private sector and founding members such as Brussels Air- whether it is tangible or intangible, cul- This project is truly the essence of this regional authorities from its member re- lines, Volvo, Accor Hotels, UNICAP Tele- tural, architectural, historic, touristic, in- Community to put companies and region- gions. In other words, it seeks for a win-win vision and BNP Paribas Fortis. One of dustrial or gastronomic. Each episode will al authorities together in order to create partnership by helping companies to get in them shared testimony: “The Volvo Group show the industrial heritage, namely the innovative ideas, growth and jobs. NEWEUROPE www.neweurope.eu 02 May 2014 A partner for regional growth

Not only business… “Opening up to the business How to boost Small and world is part of a wider commitment to better understand the regional realities”, Medium-Sized Enterprises? underlined Pascal Goergen, AER ccording to the European Com- pean Regions proposes to open-minded by way of example, give them the chance Secretary General. Starting from mission, more than 99% of all and innovative SMEs to join the AER to join their forces and create skills and this point, AER created an Academic European businesses are, in fact, Dynamic Regional SMEs network. This knowledge centers. and Training Centre, composed SmallA and Medium-Sized Enterprises economic subsidiarity represents a “Instead of proposing business to busi- of experts on the questions of (SME). They provide two out of three of unique opportunity for companies to ness relations (B2B), we put forward eco- regionalisation and decentralisation the private sector jobs and contribute to meet with politicians and policy makers nomic exchanges through regions to regions from all across Europe. more than half of the total added value cre- at the regional level, which is by nature (R2R). This is the added value of our Busi- ated by businesses in the EU. very accessible and flexible. Acting as a ness Community. We will help a regional “In the same vein, and Moreover, SMEs are the true back- networking platform, sharing ideas and enterprise to promote and internationalize since its creation, AER has bone of the European economy, being exchanging good practices, AER wishes to itself among our 230 member regions. We always put Youth at the primarily responsible for wealth and eco- boost growth via the development of in- are talking about an effective economic sub- nomic growth, next to their key role in terregional economic exchanges, open- sidiarity” explained Pascal GOERGEN, heart of its actions, notably innovation and R&D. What is even more ing new markets for businesses and new AER Secretary General. “It is important through its ‘Youth Regional intriguing is that nine out of ten SMEs are opportunities throughout Europe, and to underline that nowadays, 99% of Euro- Network’ and more recently actually micro enterprises with less than giving regions the opportunity to benefit pean enterprises are SMEs. We are talking 10 employees. Hence, the mainstays of Eu- from the ideas, expertise and know-how of about 23 millions enterprises! Regional au- the ‘Youth and Students rope’s economy are micro firms, each pro- the private sector. thorities have the responsibility to provide Community’. viding work for two persons, in average. Promoting economic exchanges be- concrete solutions to this new design”, he web address: www.aer.eu In this context, the Assembly of Euro- tween SMEs from different regions can, concluded.

How to become one of the AER Dynamic Regional SMEs ?

You consider your company as a open-minded and innovative SME and you wish to enjoy the benefits of a wide network bringing together regional leaders, European stakeholders, The Assembly of European Regions’ thematic networks and bigger companies? To join our Business Community and become one of the AER Dynamic Regional SMEs, please send us this registration form. Upon reception, we will directly get back to you with Dynamic Regional SMEs a proposal of partnership.

The membership fee for 2014 is directly linked to the number of employees working in your company (VAT not included):

1 to 20: !250 21 to 50: !500 51 and more: !1000

Registration

Name of the company: ______Address: ______City/Region/Country: ______Business sector/Industry: ______A unique opportunity to highlight and develop your business and Number of employees: 1 to 20 21 to 50 51 and more □ □ □ expertise in European regions... Name and function of the representing person: ______And beyond! ______

E-mail: ______Phone number: ______Website: ______

I am interested in joining the AER Dynamic Regional SMEs and want to receive □ more information. Date: Signature:

Contacts Alexandre BRECX Pascal GOERGEN AER Community Coordinator Secretary General [email protected] [email protected] +32 2 880 95 65 +32 2 880 95 64 210 Avenue Louise 6 Rue Oberlin Join our Business Community ! B-1050 Brussels www.aer.eu F-67000 Strasbourg

© Assembly of European Regions 2014 - Responsible publisher: Pascal Goergen NEWEUROPE www.neweurope.eu A partner for regional growth MAY 2014 03 AER, official regional partner of the European Business Summit

his week, Brussels will host the Eu- ropean Business Summit (EBS). It is an initiative of BusinessEurope and Tthe Federation of Enterprises in Belgium. EBS is the annual summit for business lead- ers and policymakers in Europe where in- ternational business and European politics shape the future and set the agenda for the coming years. Every year, EBS attracts more than 2,000 participants from over 60 countries, European Commissioners, Prime Minis- ters, high-ranking individuals and about 200 journalists. Apart from the workshops and the plenary sessions, side events take place such as networking cocktails and a gala dinner, as well as numerous press con- ferences and media events. The theme for “As the official regional EBS 2014 is: “The Business Agenda 2014- 2019: Rebuilding a Competitive Europe”. AER President Hande Özsan Bozatli and Marian-Constantin Vasile, President of the partner of the EBS, 2014 will be a year of political changes. The Committee for ‘Economy and Regional development’ at the World Investment Conference European Parliament elections will take (Strasbourg, June 2013) AER demonstrates place just one week after the Summit, with can be actively attracted and nourished participants to consider how to build suc- the importance of the new Commission appointments in the through innovative policies to boost in- cessful policies in order to stimulate and autumn, as well as a series of local and na- vestment opportunities and the interna- create a competitive business ecosystem taking into account tional elections. tionalisation of regional SMEs, business capable of accelerating regional growth and the regional actors The globalisation of the world mar- benefits and an outstanding quality of life. bringing about a smart, sustainable and in- kets has changed the rules of the game for This year, the Assembly of European Re- clusive regional economy. and strengthening our regions: economies and companies, gions is the unique regional partner of the EBS 2014 presents a significant oppor- big and small alike, are operating in a global European Business Summit. With the ob- tunity for business leaders to present their the dialogue with environment. Globalisation has acceler- jective of promoting economic subsidiar- priorities - looking beyond the crisis and to- them, which are the ated the entry of developing economies into ity, AER will organise a regional session wards a more competitive and better-func- global supply chains, which in turn puts a lot bringing together a delegation of 60+ re- tioning Europe. cornerstone of European of pressure on our ageing societies. gional stakeholders including elected rep- On this particular occasion, the As- policy and the effective At the centre of this debate, regions are resentatives, civil servants and heads of busi- sembly of European Regions will lead a spaces where universities and talents, nesses in order to exchange good practices delegation of regional politicians, business place where Europe entrepreneurial spirit, attractive life- and recommendations on successful brand- representatives and journalists. They will 2020 can meet success.” style and innovative funding schemes ing strategies to become a prime destination bring regions from: Berat (AL), Hamp- can come together. Thus, regions can ef- for investors, start-ups, entrepreneurs and shire (UK), Tulcea (RO), Dnipropetro- Marian-Constantin Vasile, fectively offer demand-driven and supply- emerging talent. Alongside experts from the vsk (UA), Abruzzo (IT), Karlovac (HR), stimulated innovative solutions to many of European and worldwide business environ- Csongrad (HU), Brussels-Capital (BE), President of AER Committee these challenges. ment, AER President Hande Özsan Boza- Istria (HR), Timis (RO), Noord-Brabant on ‘Economy and Regional Today, with the focus shifting from the tli and European Commissioner Johannes (NL), Istanbul (TR), Vastra-Götaland crisis to recovery, regions are more than ever Hahn (Regional Policy) will share their (SE), Rhône-Alpes (FR), Walloniwe development’, Vice President of catalysts for innovation, growth and compet- view on the place of the regions in the next (BE), Norrbotten (SE), Guyane (FR) Timis (RO) itiveness. From 2014-2019 they will play a European term, especially in terms of attrac- Azores (PT) and Québec (CA). key role in creating the appropriate en- tiveness and competitiveness. Next week, New Europe Studios will in- vironment for businesses to thrive: large Through discussion between the public terview Hande Özsan Bozatli, AER Presi- companies, SMEs, start-ups, entrepreneurs and private sectors, the session will allow dent, on the outcomes of this Summit. The AER Community and its three pillars Raising awareness and visibility of the regional dimension

AER Business Community AER has launched its Business Community in 2013 with the ambition of creating links between partners and regions throughout Europe. We are happy to present the first five co-founders: