13th Apr 2024


This WEEK in the European Union

  • Private sector involvement in debt reduction for Greece: "as voluntary as a confession at a Spanish inquisition trial"? (Photo: Images Money)

Efforts to secure a deal on private sector involvement in a debt swap and reduction for Greece will take centre stage this week as one of the last pieces of the complicated jigsaw puzzle to nail down a second bailout for the debt-ridden country.

Greece is aiming to have 90 percent participation of the private sector which includes banks, insurers and pension funds. The deal on accepting a 53.5% nominal haircut is supposed to be voluntary as forced participation would trigger a 'default' label.

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However, the head of the Commerzbank noted recently that the voluntary nature of the participation "is about as voluntary as a confession at a Spanish inquisition trial." If too many bond holders - and the major ones are mostly banks - prove to be recalcitrant, Athens could activate so-called collective active clauses obliging them to take part.

The private sector involvement (PSI) deal is due to be wrapped up on Friday. Eurozone finance ministers will then discuss the terms of the deal over the phone before meeting face-to-face the following Monday (12 March) to sign off the second €130bn bailout. Their green light will also be dependent on Greece implementing yet more reforms, aimed at cutting expenditure.

On Monday the European Commission is due to present a report on progress to get more women on company boards. Viviane Reding, the commissioner behind the issue, has in the past said that the lack of women in top jobs risks damaging the internal market and threatened to legislate.

The poor representation of women in high level jobs (Figures from early 2011 showed they account for 10 percent of directors and 3 percent of chief executive officers in the EU's largest companies) comes despite the fact that a much higher percentage of women (59%) graduate than men (41%). Reding has set a target of boosting the number of women in boardrooms to 30 percent by 2015 and to 40 percent by 2020.

Organised crime will be the focus of the a draft law to be published by the commission on Wednesday. It will aim to make it easier to confiscate assets derived from organised crime. Criminals currently profit from the patchwork of member states laws by exploiting national loopholes and hiding money all over the EU.

Meanwhile the beginning of the week will be kicked off by the Brussels Tax Forum, an annual gathering of policy-makers and experts to discuss taxation issues - always a controversial topic in the EU with member states reluctant to concede any power in the area. The title of the conference - tax policy under a common currency - is particular topical this year with the single currency leaders yet to figure out how to bring sustainable growth to the eurozone economy.

Private sector to share in future bail-out costs

A two-sentence paragraph to be inserted into the Lisbon Treaty will prepare the legal groundwork for a permanent European Stability Mechanism (ESM) from mid-2013 onwards, under which the costs of future eurozone bail-outs may also be shared by sector private sector participants.

This WEEK in the European Union

Eurozone finance ministers on Monday are set to give a final green light to the second Greek bail-out, following its successful debt restructuring last week. But the troubles for Athens are far from over.

Plenary session, single market and economy in focus this WEEK

This week, get ready to dive into another plenary session of the EU Parliament and an agenda packed with economic and financial issues, ahead of a special EU summit in Brussels that will focus on competitiveness and the economy.

Environment, Ukraine imports, fish and Easter this WEEK

This week, expect no more than talks on environment, agriculture and fisheries, including discussions between the Polish and Ukrainian governments over angry protests by Polish farmers objecting to cheap grain imports from Ukraine.

EU summit, Gaza, Ukraine, reforms in focus this WEEK

This week, EU leaders come together in Brussels for their usual two-day summit to discuss defence, enlargement, migration and foreign affairs. EU ministers for foreign affairs and EU affairs will meet earlier in the week to prepare the European Council.

EU summit prep work and von der Leyen's Egypt visit This WEEK

MEPs will hold a debate with EU commission president Ursula von der Leyen about the next European Council on Tuesday. Later this week, on Sunday, von der Leyen will be in Egypt for talks regarding a potential 'cash-for-migrant-control' deal.


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