Archive for the ‘European Union’ Category

The future of the European Union could essentially be decided …

Italian Prime Minister Matteo Renzi announced his resignation shortly after midnight on Dec. 5 after his government was defeated in a referendum on constitutional reforms.

A total of 59% of Italians voted against the reforms, which were designed to reduce the size and attributions of the Senate and concentrate powers in the lower chamber. The goal of the constitutional reforms was to sever the link between political instability and financial fragility in Italy, but the referendum result instead will open a new phase of uncertainty in the country.

Renzis resignation does not mean that Italy will automatically hold early elections. Italian President Sergio Mattarella plans to meet with the main forces in Parliament to determine whether a new prime minister and a new government can be appointed.

This could result in the appointment of a caretaker government tasked with passing several political and economic reforms. In particular, this government would be in charge of adopting a new electoral law. The current law, approved in 2015, has never been used and is currently being challenged in court, giving the Italian Parliament a pretext to delay a new vote.

Should Italian lawmakers fail to appoint a new government in the coming days, elections would be held in early 2017. Renzis center-left Democratic Party and the anti-establishment Five Star Movement are polling neck and neck. The potential victory of the Five Star Movement, a party that wants to renegotiate Italys debt and hold a referendum on the countrys membership in the eurozone, will create uncertainty about Italys future.

The European Central Bank (ECB) could act to mitigate a rise in Italys borrowing costs, which should be able to keep Italys interest rates under control. But the ECB is less effective when it comes to assisting Italys troubled banking sector, as some banks are struggling to recapitalize and reduce their burden of nonperforming loans.

In addition to these financial issues, the referendum result raises questions about Italys ability to introduce structural reforms. Since 1946, Italy has had more than 40 governments, and economic and political reforms have proved difficult to achieve.

The constitutional changes promoted by Renzi sought to build more stable governments and reduce market uncertainty about the countrys governability.

But Renzis decision to link the reforms to his personal political future is now putting Italy in a fragile situation. Even if the Italian Parliament manages to avoid elections for a few more months, anti-establishment sentiments in the country will not go away. With the exception of the Democratic Party, the rest of the countrys main political forces are critical of the European Union and the eurozone, which means that elections no matter when they are held will raise questions about the countrys membership in the currency union.

Read: Italian vote against the elites could shatter Europe

Italy could therefore join France and Germany in holding general elections next year. It will make 2017 a crucial year for the future of the European Union.

The French vote is particularly important because the Euroskeptic National Front party is polling strongly and will probably make it to the second round of the presidential election in May. The possibility of a eurozone breakup is still distant because the Five Star Movement and the National Front would first have to win an election, and then hold a referendum on eurozone membership and win it.

But the mere announcement of a referendum on eurozone membership in France and Italy (Europes second- and third-largest economies, respectively) could be enough to precipitate the collapse of the entire currency area.

And even if Euroskeptic parties fail to access power in 2017, popular discontent with the status quo will continue to influence European politics and challenge the continuity of the European Union in its current form.

This article was published with the permission of Stratfor, the Austin, Texas-based geopolitical-intelligence firm.

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The future of the European Union could essentially be decided ...

Polls Open In Austria and Italy For Anti-Establishment Votes …

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Both polls have already caused significant regret for the European left, with significant potential fallout for the European Union dependent on result.

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In Italy, voters are being asked for a single yes-or-no vote on a series of complicated constitutional changes proposed by Prime Minister Matteo Renzi, but the plebiscite has taken on far more meaning than just the streamlining of the political and electoral systems.

The vote has, for many, become a referendum on Renzi himself, who has said he will resign if the measure fails. The chopping-block aspect of the vote is heightened by the near-incomprehensibility of the many measures contained in the single document, many of which are intricate and obtuse.

The risk of political instability has triggered market reaction before the vote, with bank stocks sinking and the borrowing costs on sovereign debt rising.

Should Mr. Renzi be forced to stand down by failing to carry his referendum, a snap general election could see prominent no campaign backer Beppe Grillo and his Eurosceptic Five Star Movement form a government. Recent polls have shown him to be leading in the country, and his victory would likely see Italy voting in another referendum this time to leave the European Union.

Meanwhile in Austria, whichever way the vote goes the nationhas no chance of their new president coming from a mainstream party. The two traditional centre left and right parties which have controlled Austrian politics for decades were knocked out in the first round of voting in April, leaving Norbert Hofer of the anti-mass migration, Eurosceptic Freedom Party and former green party leader Alexander Van Der Bellen in the running.

While Mr. Van Der Bellen took the second round in May by a few thousand votes a fraction of a percent of those cast revelations over vote tampering and poorly handled postal ballots led to the nations high court ordering a re-run. It found the number of potentially contaminated votes in that contest was higher than the margin of victory.

Mr. Hofer is campaigning to secure Austrias borders and has mooted the country joining the conservative Visegrad group of nations. Present members Poland, Hungary, Slovakia, and Czechia have formed the vanguard of nations in Europe opposing Brussels directives on mass migration and resettlement.

He has said he would support a referendum on Austrian membership of the European Union if the bloc continued the process to admit Turkey.

As reported byBreitbart London, a planned protest against Mr. Hofer in Vienna yesterday fell flat, with the number of press who turned up to cover the march outnumbering those actually protesting. While pollsters have said the contest is too close to call, bookmakers have slashed odds on Mr. Hofer, making him the clear favourite.

First results from the Austrian election are expected around 1800 GMT, with a preliminary result in the evening. A certified result will follow on Monday. Results for the Italian referendum are not expected until Monday.

AFP contributed to this report

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Polls Open In Austria and Italy For Anti-Establishment Votes ...

Year of electoral tests may end European Union as we know it …

National Front leader Marine le Pen has called for a referendum on EU membership to be held in France. Photograph: Matthieu Alexandre/AFP/Getty Images

In Italy and Austria this weekend a shaken EU faces the first of a series of pivotal electoral tests that could profoundly change the political landscape of the bloc, and conceivably herald the end of the European project in its current form.

Shortly before last Mays G7 meeting in Tokyo, Martin Selmayr, the senior Brussels official who runs the cabinet of the European commission president, Jean-Claude Juncker, tweeted what he described as his populist horror scenario.

Imagine, he said, if instead of Barack Obama, Franois Hollande, David Cameron and Matteo Renzi, next years summit were to feature Donald Trump, Marine Le Pen, Boris Johnson and Beppe Grillo.

Selmayr was right about Trump, now the US president-elect. He was half-right about Johnson, who missed out on the job of prime minister after Cameron resigned following Britains Brexit vote, but did become foreign secretary.

If he proves right on the rest, Europe will be in serious trouble.

The angry, anti-establishment, nation-first tide that voted to sweep the UK out of the EU and Trump into the White House in what the billionaire property developer himself called a Brexit plus, plus, plus is rising steadily across the continent.

It is still far from certain to carry all before it. But over the next 12 months, EU member states face a dozen referendums and parliamentary and presidential elections, many contested by populist, Eurosceptic parties whose members believe that what happened in the UK and the US can now happen in Europe.

The French prime minister, Manuel Valls, has said Europe could die in the face of attacks from the populists. Germans doughty finance minister, Wolfgang Schuble, has warned of the scourge of demagogic populism, while the EUs economic affairs commissioner, Pierre Moscovici, suggested Europes voters might be poised to destroy it.

The first two tests will be on Sunday. In Austria, voters elect a new president after their first attempt was annulled. In a race currently too close to call, Norbert Hofer, of the anti-immigration Freedom party, could become the first freely elected far-right head of state in western Europe since the second world war.

On the same day, Italians vote in a referendum on constitutional reforms on which Renzi has staked his political future. Polls have suggested the prime minister will lose potentially bringing Grillos fiercely anti-establishment Five Star Movement a step closer to power.

The Netherlands goes to the polls on 15 March. There, Geert Wilders and his Eurosceptic, anti-Islam Freedom party is tied in the polls with the prime minister, Mark Ruttes liberal VVD.

In France, the first round of presidential elections is on 23 April. The leader of the far-right, anti-European Front National, Marine Le Pen, is expected to advance from this to the runoff stage the following month.

Germany votes later, in federal elections that could well see the far-right Alternative fr Deutschland (AfD) enter parliament as the third-largest party, on the back of strong opposition to Angela Merkels open-door refugee policy.

And in the Czech Republic in October, the populists of ANO 2011, the Action of Dissatisfied Citizens, are forecast to win in the general elections.

Simon Tilford, of the Centre for European Reform thinktank, said the two big flashpoints for the union would be Italys constitutional referendum and Frances presidential election.

In Italy, if Renzi loses the referendum, cant survive, and elections then return a government committed to a referendum on taking [the country] out of the euro that could produce a real standoff, Tilford said.

And in France, if Le Pen should win ... We dont know what would happen, but shes talked of a referendum on the euro, and on Frances EU membership. A strongly Eurosceptic government in France would mean a full-blown crisis in Europe.

All this is by no means certain, of course. The populists confidence could be misplaced. All were quick to welcome the Brexit vote and Trumps victory as events that, in Le Pens words, made possible what was considered impossible.

But in such uncertain times, voters could opt for continuity and stability: polls show support for the EU has surged since Britain voted to leave, and polling since the US election suggests no immediate Trump bounce for the Eurosceptics.

A victory in Austria by Hofer, the candidate from a party founded by a former SS officer, would be a huge symbolic blow for Europe and could presage worse in parliamentary elections to follow in 2018. Some, however, argue that its actual consequences may be limited: the presidential role is largely ceremonial.

In Italy, Renzi could cling on, or be replaced by a technocratic government committed to continuing steady, incremental reform. And if snap elections do follow, Italys electoral system does not necessarily make it easy for a single party to gain a majority in both houses of parliament.

In France, every poll so far has predicted Le Pen will lose heavily in the second round to a more centrist rival, who, on current form, is likely to be the conservative Franois Fillon. In the Netherlands, even if his toxic party emerges as the largest, Wilders is unlikely to be able to form a majority.

But regardless of the electoral outcomes, Europes upstarts will still shape the debate. Analysts point to the enormous influence exercised by the former Ukip leader, Nigel Farage, even though he was never elected to Westminster, and how mainstream, centrist parties, particularly on the right, have been pulled inexorably to the more radical edge in the Netherlands and France.

Mainstream leaders such as Merkel or Fillon would find themselves weakened, heading countries arguably more deeply divided than at any time in the postwar era, and struggling to push through their programmes.

For the European project itself, its confidence knocked by Brexit, the upcoming Trump presidency, a continuing migrant crisis, the terrorism threat, an agonisingly slow return to strong economic growth and the gathering Eurosceptic backlash, the consequences could be serious.

Faced with a more pressing need than ever to get our act together, bring back a sense of direction, confidence, order as the European council president, Donald Tusk, put it the bloc may find itself less able than ever to actually do so.

Its instinct, certainly, will be to pull together and maintain unity at all costs not, from the UKs perspective, a good sign for productive Brexit negotiations and move forward forcefully where it can.

The head of the European Central Bank, Mario Draghi, said the blocs challenge must be to provide outcomes that are both more efficient, and more directly aimed at the people, their needs and their fears not towards institution-building.

Trumps apparent fondness for the Russian president, Vladimir Putin, along with his suggestion that US support for Nato the security umbrella that for 60 years has made European stability and prosperity possible may not be unconditional, has already prompted progress in one area.

A Franco-German defence and security initiative launched in September has gained fresh impetus, with foreign and defence ministers agreeing concrete steps to bolster the blocs capacity to respond to conflicts and crises on its borders. The influential German MEP Manfred Weber said Trump will force Europe to grow up.

Beyond security, analysts say, the unions most pressing priority must be economic recovery, wage growth, the return of some sense of wellbeing. Not that the whole anti-European backlash is solely attributable to that, said Tilford. But the poor performance of the EU economy is a very big factor.

In fact, said Gianni Pittella, the leader of the European parliaments Socialist group, Brexit and Trump had created a huge opportunity for strong, pragmatic EU initiatives.

Will they happen? Will Europe advance, or crumble? The coming months and years will be critical. If anti-Europeans win national elections and the EU fails to rise to the nation-first challenge, it will struggle to survive in its present form.

Few think it will break up entirely. But its ambitions may shrink; it could become more of commercial association than a 60-year-old, overarching political project. A hard eurozone core may ultimately emerge, with satellite associate members.

Some, including in Britain, would regard that as a good thing. But according to Mark Leonard, of the European Council on Foreign Relations, in a less open world of trade barriers and anti-migrant walls, where solidarity among old allies must pass a cost-benefit analysis, they should be careful what they wish for.

Ultimately, Leonard said in an article for Social Europe, even Europes most Trump-like leaders will find it harder to defend their national interest if they try to go it alone. To survive in Trumps world, they should try to make Europe great again.

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Year of electoral tests may end European Union as we know it ...

Economy of the European Union – Wikipedia

Economy of the European Union Currency (EUR) - Euro//

Trade organisations

GDP growth

GDP per capita

GDP by sector

Labour force

Labour force by occupation

Main industries

List

Export goods

List

Main export partners

Import goods

List

Main import partners

Foreign reserves

The European Union is the second largest economy in the world (if treated as a single country) in nominal terms and according to purchasing power parity (PPP). The European Union's GDP was estimated to be 16.5trillion (nominal) in 2016 according to the International Monetary Fund, representing 22,8% of nominal global GDP.[18]

The euro, used by 19 of its 28 members, is the second largest reserve currency as well as the second most traded currency in the world after the United States dollar.[19][20][21] The euro is the official currency in the eurozone and in six other European countries, officially or de facto. All the members of the European Union are obliged to join the eurozone, except the United Kingdom and Denmark who have negotiated opt-outs.

The European Union (EU) economy consists of an internal market of mixed economies based on free market and advanced social models. The GDP per capita (PPP) was $37,800 in 2015,[1] compared to $57,084 in the United States and $14,340 in China.[22] With a low Gini coefficient of 31, the European Union has a more egalitarian repartition of incomes than the world average.[23][24]

Euronext is the main stock exchange of the Eurozone and the 7th world largest by market capitalisation.[25]Foreign investments made in the European Union total $5.1 trillion in 2012, while the E.U's investments in foreign countries total 9.1 trillion, by far the highest domestic and foreign investments in the world.[26][27]

Since the beginning of the public debt crisis in 2009, opposite economic situations have emerged between Southern Europe and Central and Northern Europe: a high unemployment rate and public debt in the Mediterranean countries, and a low unemployment rate with higher GDP growth rate in the former Eastern communist countries and in the Northern countries. In 2015, public debt in the European Union was slightly above 85% of GDP, with important disparities between the lowest rate, Estonia with 9,7%, and the highest, Greece with 176%.[28]

The seven largest trading partners of the European Union are the United States, China, Switzerland, Russia, Japan, Turkey and Norway. The EU is represented as a unified entity in the World Trade Organization (WTO), the G-20 and G7, alongside with the EU's member countries participating.

Beginning in the year 1999 with some EU member states, now 19 out of 28 EU states use the euro as official currency in a currency union. The remaining 9 states continued to use their own currency with the possibility to join the euro later. The euro is also the most widely used currency in the EU.

Since 1992 the Maastricht treaty sets out rigid economic and fiscal convergence criteria for the states joining the euro. Starting 1997, the Stability and Growth Pact has been started to ensure continuing economic and fiscal stability and convergence.

Denmark and the United Kingdom, not members of the eurozone, have special opt-outs concerning the later joining of the euro. Also, Sweden can effectively opt out by choosing when or whether to join the European Exchange Rate Mechanism, which is the preliminary step towards joining. The remaining states are committed to join the euro through their Treaties of Accession.

Starting with Greece in 2009, five of the 19 eurozone states have been struggling with a sovereign debt crisis, by many called the European debt crisis. All these states started reforms and got bailout packages (Greece, Ireland, Portugal, Spain, Cyprus). As of May 2015, all countries but Greece have recovered from their debt crisis (Greece is recovering as of April 2016, though[citation needed]). Other non-eurozone states also experienced a debt crisis and also went through successful bailout programmes, i.e. Hungary, Romania and Latvia (the latter before it joined the eurozone).[29]

The operation of the EU has an agreed budget of 141billion for the year 2011, and 862billion for the period 20072013,[30] this represents around 1% of the EU's GDP.

The services sector is by far the most important sector in the European Union, making up 74.7% of GDP, compared to the manufacturing industry with 23.8% of GDP and agriculture with only 1.5% of GDP.[31]

The agricultural sector is supported by subsidies from the European Union in the form of the Common Agricultural Policy (CAP). In 2013 this represented approximately 45billion (less than 33% of the overall budget of 148billion) of the EU's total spending.[32] It was used originally to guarantee a minimum price for farmers in the EU. This is criticised as a form of protectionism, inhibiting trade, and damaging developing countries; one of the most vocal opponents is the UK, the second largest economy within the bloc, which has repeatedly refused to give up the annual UK rebate unless the CAP undergoes significant reform; France, the biggest beneficiary of the CAP and the bloc's third largest economy, is its most vocal proponent. The CAP is however witnessing substantial reform. In 1985, around 70% of the EU budget was spent on agriculture. In 2011, direct aid to farmers and market-related expenditure amount to just 30% of the budget, and rural development spending to 11%. By 2011, 90% of direct support had become non-trade-distorting (not linked to production) as reforms have continued to be made to the CAP, its funding and its design.[33]

The European Union is a major tourist destination, attracting visitors from outside of the Union and citizens travelling inside it. Internal tourism is made more convenient by the Schengen treaty and the euro. All citizens of the European Union are entitled to travel to any member state without the need of a visa.

France is the world's number one tourist destination for international visitors, followed by Spain, Italy, Germany and the United Kingdom. It is worth noting, however, that a significant proportion of international visitors to EU countries are from other member states.

London, the capital of the United Kingdom is also the world's most visited city (16.9 million visitors in 2012) and the highest in tourism receipts, shortly followed by Paris with 16 million visitors.[34]

The European Union's member states are the birthplace of many of the world's largest leading multinational companies, and home to its global headquarters. Among these are distinguished companies ranked first in the world within their industry/sector, like Allianz, which is the largest financial service provider in the world by revenue; WPP plc which is the world's largest advertising agency by revenue; Airbus, which is the world's largest aircraft manufacturer;[35]Air France-KLM, which is the largest airline company in the world in terms of total operating revenues; Amorim, which is the world's largest cork-processing and cork producer company; ArcelorMittal, which is the largest steel company in the world; Inditex which is the biggest fashion group in the world; Groupe Danone, which has the world leadership in the dairy products market.[citation needed]

Anheuser-Busch InBev is the largest beer company in the world; L'Oral Group, which is the world's largest cosmetics and beauty company; LVMH, which is the world's largest luxury goods conglomerate; Nokia Corporation, which is the world's largest manufacturer of mobile telephones; Royal Dutch Shell, which is one of the largest energy corporations in the world; and Stora Enso, which is the world's largest pulp and paper manufacturer in terms of production capacity, in terms of banking and finance the EU has some of the worlds largest notably HSBC and Grupo Santander, the largest bank in Europe in terms of Market Capitalisation.[citation needed]

Many other European companies rank among the world's largest companies in terms of turnover, profit, market share, number of employees or other major indicators. A considerable number of EU-based companies are ranked among the worlds' top-ten within their sector of activity. Europe is also home to many prestigious car companies such as BMW, Ferrari, Jaguar, Land Rover, Maserati, Mercedes, Porsche, as well as volume manufacturers such as Fiat, PSA group, Renault and Volkswagen.[citation needed]

Below is a table showing, respectively, the GDP and the GDP (PPP) per capita for the European Union and for each of its member states, ordered according to the 'Size' of their economies. The table can also be used as a rough gauge to the relative standards of living among member states, with Luxembourg the highest and Bulgaria the lowest. Eurostat, based in Luxembourg, is the Official Statistical Office of the European Communities releasing yearly GDP figures for the member states as well as the EU as a whole, which are regularly updated, supporting this way a measure of wealth and a base for the European Union's budgetary and economic policies. Figures are stated in euros.

Economic performance varies from state to state. The Growth and Stability Pact governs fiscal policy with the European Union. It applies to all member states, with specific rules which apply to the eurozone members that stipulate that each state's deficit must not exceed 3% of GDP and its public debt must not exceed 60% of GDP. Many larger members have consistently run deficits substantially in excess of 3%, and the eurozone as a whole has a debt percentage exceeding 60% (see below).

The EU's share of gross world product (GWP) is stable at around one fifth.[42]

The twelve new member states of the European Union have enjoyed a higher average percentage growth rate than their elder members of the EU. Slovakia has the highest GDP growth in the period 20052011 among all countries of the European Union (See Tatra Tiger). Notably the Baltic states have achieved high GDP growth, with Latvia topping 11%, close to China, the world leader at 9% on average for the past 25 years (though these gains have been in great part cancelled by the late-2000s recession).

Reasons for this growth include government commitments to stable monetary policy, export-oriented trade policies, low flat-tax rates and the utilisation of relatively cheap labour. In 2015 Ireland had the highest GDP growth of all the states in EU (5.2%). The current map of EU growth is one of huge regional variation, with the larger economies suffering from stagnant growth and the new nations enjoying sustained, robust economic growth.

Although EU28 GDP is on the increase, the percentage of gross world product is decreasing because of the emergence of economic powers such as China, India and Brazil.

The European Union has uranium, coal, oil, and natural gas reserves. There are six oil producers in the European Union, primarily in North Sea oilfields. The United Kingdom is by far the largest producer; Denmark, Germany, Italy, Romania and the Netherlands all produce oil. If it is treated as a single unit, which is not conventional in the oil markets, the European Union is the 19th largest producer of oil in the world, producing 1,241,370 (2013) barrels a day.[citation needed]

It is the world's second largest consumer of oil, consuming much more than it can produce, at 12,790,000 (2013) barrels a day. Much of the difference comes from Russia and the Caspian Sea basin. All countries in the EU have committed to the Kyoto Protocol, and the European Union is one of its biggest proponents. The European Commission published proposals for the first comprehensive EU energy policy on 10 January 2007.[citation needed]

EU

Top 10 trading partners (2010)

Top 1120 trading partners (2010)

The European Union is the largest exporter in the world[45] and as of 2008 the largest importer of goods and services.[46] Internal trade between the member states is aided by the removal of barriers to trade such as tariffs and border controls. In the eurozone, trade is helped by not having any currency differences to deal with amongst most members.[47]

The European Union Association Agreement does something similar for a much larger range of countries, partly as a so-called soft approach ('a carrot instead of a stick') to influence the politics in those countries. The European Union represents all its members at the World Trade Organization (WTO), and acts on behalf of member states in any disputes. When the EU negotiates trade related agreement outside the WTO framework, the subsequent agreement must be approved by each individual EU member.[47]

The EU seasonally adjusted unemployment rate was 8.6% in May 2016. The euro area unemployment rate was 10.1%.[50]

Among the member states, the lowest unemployment rates were recorded in Czech Republic (4.0%), Malta (4.1%) and Germany (4.2%), and the highest in Spain (19.8%) and Greece (23.3% in April 2016).[50]

The following table shows the history of the unemployment rate for all European Union member states:

Evolution of unemployment ranking within the European Union (from lower to higher rates):[51]

Comparing the richest areas of the EU can be a difficult task. This is because the NUTS 1 & 2 regions are not homogenous, some of them being very large regions, such as NUTS-1 Hesse (21,100km) or NUTS-1 le-de-France (12,011km), whilst other NUTS regions are much smaller, for example NUTS-1 Hamburg (755km) or NUTS-1 Greater London (1,580km). An extreme example is Finland, which is divided for historical reasons into mainland Finland with 5.3million inhabitants and land, an autonomous archipelago with a population of 27,000, or about the population of a small Finnish city.

One problem with this data is that some areas, including Greater London, are subject to a large number of commuters coming into the area, thereby artificially inflating the figures. It has the effect of raising GDP but not altering the number of people living in the area, inflating the GDP per capita figure. Similar problems can be produced by a large number of tourists visiting the area. The data is used to define regions that are supported with financial aid in programs such as the European Regional Development Fund. The decision to delineate a Nomenclature of Territorial Units for Statistics (NUTS) region is to a large extent arbitrary (i.e. not based on objective and uniform criteria across Europe), and is decided at European level (See also: Regions of the European Union).

The 10 NUTS-1 and NUTS-2 regions with the highest GDP per capita are almost all, except two, in the first fifteen-member states: Prague and Bratislava are the only ones in the 13 new member states that joined in May 2004, January 2007 and July 2013. The leading regions in the ranking of NUTS-2 regional GDP per inhabitant in 2014 were Inner London-West in the United Kingdom (539% of the average), the Grand Duchy of Luxembourg (266%) and Brussels in Belgium (207%). Figures for these three regions, however, are artificially inflated by the commuters who do not reside in these regions ("Net commuter inflows in these regions push up production to a level that could not be achieved by the resident active population on its own. The result is that GDP per inhabitant appears to be overestimated in these regions and underestimated in regions with commuter outflows."[53]).

Another example of artificial inflation is Groningen. The calculated GDP per capita is very high because of the large natural gas reserves in this region, but Groningen is one of the poorest parts in the Netherlands. Among the 46 NUTS-2 regions exceeding the 125% level, fourteen were in Germany, five in the Netherlands and in Austria, four each in Belgium and the United Kingdom, three in Italy, two in Finland and one in Czech Republic, Denmark, Ireland, France, Romania, Slovakia, Spain and Sweden, as well as in the single region Grand Duchy of Luxembourg. The NUTS Regulation lays down a minimum population size of 3million and a maximum size of 7million for the average NUTS-1 region, whereas a minimum of 800,000 and a maximum of 3million for NUTS-2 regions [1]. This definition, however, is not respected by Eurostat. E.g.: the rgion of le-de-France, with 11.6million inhabitants, is treated as a NUTS-2 region, while the state Free Hanseatic City of Bremen, with only 664,000 inhabitants, is treated as a NUTS-1 region.

Source: Eurostat[53]

Among the ten lowest regions in the ranking in 2014 most were in Bulgaria and Romania, with the lowest figure recorded in Severozapaden in Bulgaria. Among the 76 regions below the 75% level, fourteen were in Poland, eleven in Greece, seven in Romania, six each in Hungary and Italy, five each in Bulgaria, Portugal and Spain, four each in the Czech Republic and France, three in Slovakia, two each in Croatia and the United Kingdom, one in Slovenia as well as Latvia.[53]

Source: Eurostat[53]

The following links are used for the GDP growth and GDP totals (IMF):

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Economy of the European Union - Wikipedia

European Commission – Wikipedia

The European Commission (EC) is the executive body of the European Union responsible for proposing legislation, implementing decisions, upholding the EU treaties and managing the day-to-day business of the EU.[2] Commissioners swear an oath at the European Court of Justice in Luxembourg, pledging to respect the treaties and to be completely independent in carrying out their duties during their mandate.[3]

The Commission operates as a cabinet government, with 28 members of the Commission (informally known as "commissioners").[4] There is one member per member state, but members are bound by their oath of office to represent the general interest of the EU as a whole rather than their home state.[3] One of the 28 is the Commission President (currently Jean-Claude Juncker) proposed by the European Council[5] and elected by the European Parliament.[6] The Council of the European Union then nominates the other 27 members of the Commission in agreement with the nominated President, and the 28 members as a single body are then subject to a vote of approval by the European Parliament.[7] The current Commission is the Juncker Commission, which took office in late 2014.

The term Commission is used either in the narrow sense of the 28-member College of Commissioners (or College) or to also include the administrative body of about 23,000 European civil servants who are split into departments called directorates-general and services.[8][9] The procedural languages of the Commission are English, French and German.[10] The Members of the Commission and their "cabinets" (immediate teams) are based in the Berlaymont building in Brussels.

The European Commission derives from one of the five key institutions created in the supranational European Community system, following the proposal of Robert Schuman, French Foreign Minister, on 9 May 1950. Originating in 1951 as the High Authority in the European Coal and Steel Community, the Commission has undergone numerous changes in power and composition under various presidents, involving three Communities.[11]

The first Commission originated in 1951 as the nine-member "High Authority" under President Jean Monnet (see Monnet Authority). The High Authority was the supranational administrative executive of the new European Coal and Steel Community (ECSC). It took office first on 10 August 1952 in Luxembourg. In 1958 the Treaties of Rome had established two new communities alongside the ECSC: the European Economic Community (EEC) and the European Atomic Energy Community (Euratom). However their executives were called "Commissions" rather than "High Authorities".[11] The reason for the change in name was the new relationship between the executives and the Council. Some states such as France expressed reservations over the power of the High Authority and wished to limit it giving more power to the Council rather than the new executives.[12]

Louis Armand led the first Commission of Euratom. Walter Hallstein led the first Commission of the EEC, holding the first formal meeting on 16 January 1958 at the Chteau of Val-Duchesse. It achieved agreement on a contentious cereal price accord as well as making a positive impression upon third countries when it made its international debut at the Kennedy Round of General Agreement on Tariffs and Trade (GATT) negotiations.[13] Hallstein notably began the consolidation of European law and started to have a notable impact on national legislation. Little heed was taken of his administration at first but, with help from the European Court of Justice, his Commission stamped its authority solidly enough to allow future Commissions to be taken more seriously.[14] However, in 1965 accumulating differences between the French government of Charles de Gaulle and the other member states (over British entry, direct elections to Parliament, the Fouchet Plan and the budget) triggered the "empty chair" crisis ostensibly over proposals for the common agricultural policy. Although the institutional crisis was solved the following year, it cost Etienne Hirsch his presidency of Euratom and later Walter Hallstein the EEC presidency despite otherwise being viewed as the most 'dynamic' leader until Jacques Delors.[13]

The three bodies, collectively named the European Executives, co-existed until 1 July 1967 when, under the Merger Treaty, they were combined into a single administration under President Jean Rey.[11] Due to the merger the Rey Commission saw a temporary increase to 14 members, although subsequent Commissions were reduced back down to nine, following the formula of one member for small states and two for larger states.[15] The Rey Commission completed the Community's customs union in 1968 and campaigned for a more powerful, elected, European Parliament.[16] Despite Rey being the first President of the combined communities, Hallstein is seen as the first President of the modern Commission.[11]

The Malfatti and Mansholt Commissions followed with work on monetary co-operation and the first enlargement to the north in 1973.[17][18] With that enlargement the Commission's membership increased to thirteen under the Ortoli Commission (the United Kingdom as a large member was granted two Commissioners), which dealt with the enlarged community during economic and international instability at that time.[15][19] The external representation of the Community took a step forward when President Roy Jenkins, recruited to the presidency in January 1977 from his role as Home Secretary of the United Kingdom's Labour government,[20] became the first President to attend a G8 summit on behalf of the Community.[21] Following the Jenkins Commission, Gaston Thorn's Commission oversaw the Community's enlargement to the south, in addition to beginning work on the Single European Act.[22]

The Commission headed by Jacques Delors was seen as giving the Community a sense of direction and dynamism.[23] Delors and his team are also considered as the "founding fathers of the euro".[24] The International Herald Tribune noted the work of Delors at the end of his second term in 1992: "Mr. Delors rescued the European Community from the doldrums. He arrived when Europessimism was at its worst. Although he was a little-known former French finance minister, he breathed life and hope into the EC and into the dispirited Brussels Commission. In his first term, from 1985 to 1988, he rallied Europe to the call of the single market, and when appointed to a second term he began urging Europeans toward the far more ambitious goals of economic, monetary and political union".[25]

The successor to Delors was Jacques Santer. The entire Santer Commission was forced to resign in 1999 by the Parliament as result of a fraud and corruption scandal, with a central role played by dith Cresson. These frauds were revealed by an internal auditor Paul van Buitenen.[26][27]

That was the first time a Commission had been forced to resign en masse and represented a shift of power towards the Parliament.[28] However the Santer Commission did carry out work on the Amsterdam Treaty and the euro.[29] In response to the scandal the European Anti-Fraud Office (OLAF) was created.

Following Santer, Romano Prodi took office. The Amsterdam Treaty had increased the Commission's powers and Prodi was dubbed by the press as something akin to a Prime Minister.[30][31] Powers were strengthened again with the Nice Treaty in 2001 giving the Presidents more power over the composition of their Commissions.[11]

In 2004 Jos Manuel Barroso became President: the Parliament once again asserted itself in objecting to the proposed membership of the Barroso Commission. Due to the opposition Barroso was forced to reshuffle his team before taking office.[32] The Barroso Commission was also the first full Commission since the enlargement in 2004 to 25 members and hence the number of Commissioners at the end of the Prodi Commission had reached 30. As a result of the increase in the number of states, the Amsterdam Treaty triggered a reduction in the number of Commissioners to one per state, rather than two for the larger states.[15]

Allegations of fraud and corruption were again raised in 2004 by former chief auditor Jules Muis.[33] A Commission officer Guido Strack reported alleged fraud and abuses in his department in years 20022004 to OLAF and was fired as result.[34] In 2008 Paul van Buitenen (the former auditor known from Santer Commission scandal) accused the European Anti-Fraud Office (OLAF) of a lack of independence and effectiveness.[35]

Barroso's first Commission term expired on 31 October 2009. Under the Treaty of Nice, the first Commission to be appointed after the number of member states reached 27 would have to be reduced to "less than the number of Member States". The exact number of Commissioners was to be decided by a unanimous vote of the European Council and membership would rotate equally between member states. Following the accession of Romania and Bulgaria in January 2007, this clause took effect for the next Commission.[36] The Treaty of Lisbon, which came into force on 1 December 2009, mandated a reduction of the number of commissioners to two-thirds of member-states from 2014 unless the Council decided otherwise. Membership would rotate equally and no member state would have more than one Commissioner. However, the treaty was rejected by voters in Ireland in 2008 with one main concern being the loss of their Commissioner. Hence a guarantee given for a rerun of the vote was that the Council would use its power to amend the number of Commissioners upwards. However, according to the treaties it still has to be fewer than the total number of members, thus it was proposed that the member state that does not get a Commissioner would get the post of High Representative the so-called 26+1 formula.[37][38] This guarantee (which may find its way into the next treaty amendment, probably in an accession treaty) contributed to the Irish approving the treaty in a second referendum in 2009.

Lisbon also combined the posts of European Commissioner for External Relations with the Council's High Representative for the Common Foreign and Security Policy. This post, also a Vice-President of the Commission, would chair the Council of the European Union's foreign affairs meetings as well as the Commission's external relations duties.[39][40] The treaty further provides that the most recent European elections should be "taken into account" when appointing the Commission, although the President is still proposed by the European Council; the European Parliament "elects" the Commission rather than "approves" it as under the Treaty of Nice.[39]

In 2014, Jean-Claude Juncker became President of the European Commission.

The Commission was set up from the start to act as an independent supranational authority separate from governments; it has been described as "the only body paid to think European".[41] The members are proposed by their member state governments, one from each. However, they are bound to act independently neutral from other influences such as those governments which appointed them. This is in contrast to the Council, which represents governments, the Parliament, which represents citizens, the Economic and Social Committee, which represents organised civil society, and the Committee of the Regions, which represents local and regional authorities.[2]

Through Article 17 of the Treaty on European Union the Commission has several responsibilities: to develop medium-term strategies; to draft legislation and arbitrate in the legislative process; to represent the EU in trade negotiations; to make rules and regulations, for example in competition policy; to draw up the budget of the European Union; and to scrutinise the implementation of the treaties and legislation.[42] The rules of procedure of the European Commission set out the Commission's operation and organisation.[8]

Before the Treaty of Lisbon came into force, the executive power of the EU was held by the Council: it conferred on the Commission such powers for it to exercise. However, the Council was theoretically allowed to withdraw these powers, exercise them directly, or impose conditions on their use.[43][44] This aspect has been changed by the Treaty of Lisbon, after which the Commission exercises its powers just by virtue of the treaties. Powers are more restricted than most national executives, in part due to the Commission's lack of power over areas like foreign policy that power is held by the European Council, which some analysts have described as another executive.[45]

Considering that under the Lisbon Treaty the European Council has become a formal institution with the power of appointing the Commission, it could be said that the two bodies hold the executive power of the EU (the European Council also holds individual national executive powers). However, it is the Commission that currently holds executive powers over the European Union.[45][46] The governmental powers of the Commission have been such that some such as former Belgian Prime Minister Guy Verhofstadt have suggested changing its name to the "European Government", calling the present name of the Commission "ridiculous".[47]

The Commission differs from the other institutions in that it alone has legislative initiative in the EU. Only the Commission can make formal proposals for legislation: they cannot originate in the legislative branches. Under the Treaty of Lisbon, no legislative act is allowed in the field of the Common Foreign and Security Policy. In the other fields the Council and Parliament are able to request legislation; in most cases the Commission initiates the basis of these proposals. This monopoly is designed to ensure coordinated and coherent drafting of EU law.[48][49] This monopoly has been challenged by some who claim the Parliament should also have the right, with most national parliaments holding the right in some respects.[50] However, the Council and Parliament may request the Commission to draft legislation, though the Commission does have the power to refuse to do so[51] as it did in 2008 over transnational collective conventions.[52] Under the Lisbon Treaty, EU citizens are also able to request the Commission to legislate in an area via a petition carrying one million signatures, but this is not binding.[53]

The Commission's powers in proposing law have usually centred on economic regulation. It has put forward a large number of regulations based on a "precautionary principle". This means that pre-emptive regulation takes place if there is a credible hazard to the environment or human health: for example on tackling climate change and restricting genetically modified organisms. This is opposed to weighting regulations for their effect on the economy. Thus, the Commission often proposes stricter legislation than other countries. Due to the size of the European market this has made EU legislation an important influence in the global market.[54]

Recently the Commission has moved into creating European criminal law. In 2006, a toxic waste spill off the coast of Cte d'Ivoire, from a European ship, prompted the Commission to look into legislation against toxic waste. Some EU states at that time did not even have a crime against shipping toxic waste leading to the Commissioners Franco Frattini and Stavros Dimas to put forward the idea of "ecological crimes". Their right to propose criminal law was challenged in the European Court of Justice but upheld. As of 2007, the only other criminal law proposals which have been brought forward are on the intellectual property rights directive,[55] and on an amendment to the 2002 counter-terrorism framework decision, outlawing terrorismrelated incitement, recruitment (especially via the internet) and training.[56]

Once legislation is passed by the Council and Parliament, it is the Commission's responsibility to ensure it is implemented. It does this through the member states or through its agencies. In adopting the necessary technical measures, the Commission is assisted by committees made up of representatives of member states and of the public and private lobbies[57] (a process known in jargon as "comitology").[58] Furthermore, the Commission is responsible for the implementation of the EU budget, ensuring, along with the Court of Auditors, that EU funds are correctly spent.

In particular the Commission has a duty to ensure the treaties and law are upheld, potentially by taking member states or other institutions to the Court of Justice in a dispute. In this role it is known informally as the "guardian of the treaties".[59] Finally, the Commission provides some external representation for the Union, alongside the member states and the Common Foreign and Security Policy, representing the Union in bodies such as the World Trade Organisation. It is also usual for the President to attend meetings of the G8.[59]

The Commission is composed of a college of "Commissioners" of 28 members, including the President and vice-presidents. Even though each member is appointed by a national government, one per state, they do not represent their state in the Commission.[60] In practice, however, they do occasionally press for their national interest.[61] Once proposed, the President delegates portfolios among each of the members. The power of a Commissioner largely depends upon their portfolio, and can vary over time. For example, the Education Commissioner has been growing in importance, in line with the rise in the importance of education and culture in European policy-making.[62] Another example is the Competition Commissioner, who holds a highly visible position with global reach.[60] Before the Commission can assume office, the college as a whole must be approved by the Parliament.[2] Commissioners are supported by their personal cabinet who give them political guidance, while the Civil Service (the DGs, see below) deal with technical preparation.[63]

The President of the Commission is first proposed by the European Council taking into account the latest Parliamentary elections; that candidate can then be elected by the European Parliament or not. If not, the European Council shall propose another candidate within one month.[6] The candidate has often been a leading national politician, but this is not a requirement. In 2009, the Lisbon Treaty was not in force and Barroso was not "elected" by the Parliament, but rather nominated by the European Council; in any case, the centre-right parties of the EU pressured for a candidate from their own ranks. In the end, a centre-right candidate was chosen: Jos Manuel Barroso of the European People's Party.[64]

There are further criteria influencing the choice of the candidate, including: which area of Europe the candidate comes from, favoured as Southern Europe in 2004; the candidate's political influence, credible yet not overpowering members; language, proficiency in French considered necessary by France; and degree of integration, their state being a member of both the eurozone and the Schengen Agreement.[65][66][67] In 2004, this system produced a number of candidates[68] and was thus criticised by some MEPs: following the drawn-out selection, the ALDE group leader Graham Watson described the procedure as a "Justus Lipsius carpet market" producing only the "lowest common denominator"; while Green-EFA co-leader Daniel Cohn-Bendit asked Barroso after his first speech "If you are the best candidate, why were you not the first?"[69][70]

Following the election of the President, and the appointment of the High Representative by the European Council, each Commissioner is nominated by their member state (except for those states who provided the President and High Representative) in consultation with the Commission President, although he holds no hard power to force a change in candidate. However the more capable the candidate is, the more likely the Commission President will assign them a powerful portfolio, the distribution of which is entirely at his discretion. The President's team is then subject to hearings at the European Parliament which will question them and then vote on their suitability as a whole. If members of the team are found to be too inappropriate, the President must then reshuffle the team or request a new candidate from the member state or risk the whole Commission being voted down. As Parliament cannot vote against individual Commissioners there is usually a compromise whereby the worst candidates are removed but minor objections are put aside so the Commission can take office. Once the team is approved by parliament, it is formally put into office by the European Council (TEU Article 17:7).

Following their appointment, the President appoints a number of Vice-Presidents (the High Representative is mandated to be one of them) from among the commissioners. For the most part, the position grants little extra power to Vice-Presidents, except the first Vice-President who stands in for the President when he is away.[60]

The European Parliament can dissolve the Commission as a whole following a vote of no-confidence but only the President can request the resignation of an individual Commissioner. However, individual Commissioners, by request of the Council or Commission, can be compelled to retire on account of a breach of obligation(s) and if so ruled by the European Court of Justice (Art. 245 and 247, Treaty on the Functioning of the European Union).

The Barroso Commission took office in late 2004 after being delayed by objections from the Parliament, which forced a reshuffle. In 2007 the Commission increased from 25 to 27 members with the accession of Romania and Bulgaria who each appointed their own Commissioners. With the increasing size of the Commission, Barroso adopted a more Presidential style of control over the college, which earned him some criticism.[71]

However, under Barroso, the Commission began to lose ground to the larger member states as countries such as France, the UK and Germany sought to sideline its role. This has increased with the creation of the President of the European Council under the Treaty of Lisbon.[72] There has also been a greater degree of politicisation within the Commission.

The Commission is divided into departments known as Directorates-General (DGs) that can be likened to departments or ministries. Each covers a specific policy area such as Agriculture or Justice and citizens' rights or internal services such as Human Resources and Translation and is headed by Director-General who is responsible to a Commissioner. A Commissioner's portfolio can be supported by numerous DGs, they prepare proposals for them and if approved by a majority of Commissioners it goes forward to Parliament and Council for consideration.[2][73] The Commission's civil service is headed by a Secretary General, currently Alexander Italianer. The rules of procedure of the European Commission set out the Commission's operation and organisation.[8]

There has been criticism from a number of people that the highly fragmented DG structure wastes a considerable amount of time in turf wars as the different departments and Commissioners compete with each other. Furthermore, the DGs can exercise considerable control over a Commissioner with the Commissioner having little time to learn to assert control over their staff.[74][75]

According to figures published by the Commission, 23,803 persons were employed by the Commission as officials and temporary agents in September 2012. In addition to these, 9230 "external staff" (e.g. Contractual agents, detached national experts, young experts, trainees etc.) were employed. The single largest DG is the Directorate-General for Translation, with a 2309-strong staff, while the largest group by nationality is Belgian (18.7%), probably due to a majority (17,664) of staff being based in the country.[76]

Communication with the press is handled by the Directorate-General Communication. The Commission's chief spokesperson is Pia Ahrenkilde Hansen who takes the midday press briefings, commonly known as the "Midday Presser". It takes place every weekday in the Commission's press room at the Berlaymont where journalists may ask questions of Commission officials on any topic and legitimately expect to get an "on the record" answer for live TV. Such a situation is unique in the world.[77]

It has been noted by one researcher that the press releases issued by the Commission are uniquely political. A release often goes through several stages of drafting which emphasises the role of the Commission and is used "for justifying the EU and the commission" increasing their length and complexity. Where there are multiple departments involved a press release can also be a source of competition between areas of the Commission and Commissioners themselves. This also leads to an unusually high number of press releases, 1907 for 2006, and is seen as a unique product of the EU's political set-up.[75] The number of Commission press releases shows a decreasing trend. 1768 press releases were published in 2010 and 1589 in 2011.[78]

There is a larger press corps in Brussels than Washington D.C.; in 2007 media outlets in every Union member-state had a Brussels correspondent.[79] However, since the global downturn by 2010 the press corps in Brussels shrunk by a third. There is one journalist covering EU news for Latvia and none for Lithuania. Although there has been a worldwide cut in journalists, the considerable press releases and operations such as Europe by Satellite and EuroparlTV leads many news organisations to believe they can cover the EU from these source and news agencies.[80] In the face of high-level criticism,[81] the Commission is also due to shut down Presseurop on 20 December 2013.[82]

While the Commission is the executive branch, the candidates are chosen individually by the 28 national governments, which means it is not possible for a Commission Member or its President to be removed by a direct election. Rather, the legitimacy of the Commission is mainly drawn from the vote of approval that is required from the European Parliament, along with Parliament's power to dismiss the body, which, in turn, raises the concern of the relatively low turnout (less than 50%) in elections for the European Parliament since 1999. While that figure may be higher than that of some national elections, including the off-year elections of the United States Congress, the fact that there are no elections for the position of Commission President calls the position's legitimacy into question in the eyes of some.[83] The fact that the Commission can directly decide (albeit with oversight from specially formed 'comitology committees') on the shape and character of implementing legislation further raises concerns about democratic legitimacy.[84]

Even though democratic structures and methods are developing there is not such a mirror in creating a European civil society.[85] The Treaty of Lisbon may go some way to resolving the deficit in creating greater democratic controls on the Commission, including enshrining the procedure of linking elections to the selection of the Commission president. An alternative viewpoint is that electoral pressures undermine the Commission's role as an independent regulator, considering it akin with institutions such as independent central banks which deal with technical areas of policy.[86] In addition some defenders of the Commission point out that legislation must be approved by the Council in all areas (the ministers of member states) and the European Parliament in some areas before it can be adopted, thus the amount of legislation which is adopted in any one country without the approval of its government is limited.[86]

In 2009 the European ombudsman published statistics of citizens' complaints against EU institutions, with most of them filed against the Commission (66%) and concerning lack of transparency (36%).[87] In 2010 the Commission was sued for blocking access to documents on EU biofuel policy.[88] This happened after media accused the Commission of blocking scientific evidence against biofuel subsidies.[89] Lack of transparency, unclear lobbyist relations, conflicts of interests and excessive spending of the Commission was highlighted in a number of reports by internal and independent auditing organisations.[90][91][92][93] It has also been criticised on IT-related issues, particularly with regard to Microsoft.[94]

The Commission is primarily based in Brussels, with the President's office and the Commission's meeting room on the 13th floor of the Berlaymont building. The Commission also operates out of numerous other buildings in Brussels and Luxembourg.[95][96] When the Parliament is meeting in Strasbourg, the Commissioners also meet there in the Winston Churchill building to attend the Parliament's debates.[97]

Coordinates: 505037N 42258E / 50.84361N 4.38278E / 50.84361; 4.38278

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European Commission - Wikipedia