German elections

CDU/CSU = 41,5%
SPD = 25,7%
Die Linke = 8,6%
Grüne = 8,4%.

In the Parliament (630 seats):
CDU/CSU = 311
SPD = 192
Linke = 64
Grüne = 63

European Union, Singapore conclude far-reaching trade deal

"The European Union and Singapore submitted for approval on Friday one of the world's most comprehensive free trade agreements, which the EU sees as a stepping stone towards a wider deal with southeast Asia.
The chief negotiators of both sides presented the entire text of the agreement on Friday after initialling each page of the roughly 1,000-page document. Subject to approval in Singapore and by the 28 EU member states and the European Parliament, the agreement should enter into force in late 2014 or early 2015.
Trade in goods between the two topped 52 billion euros in 2012 and in services 28 billion euros in 2011. Mutual investment has reached 190 billion euros.
The European Union sees a free trade deal as opening the door to a deal with other members of the 10-nation Association of Southeast Asian Nations (ASEAN), which has set a goal of economic integration by 2015.
The EU and ASEAN launched free trade talks in 2007, but abandoned them two years later, the EU choosing instead to conduct bilateral talks with individual members.
The European Commission is already negotiating free trade accords with Malaysia and Vietnam and launched talks in March with Thailand.
Singapore has a population of just 5 million people, against some 600 million for the whole of ASEAN, but accounts for about a third of all EU-ASEAN trade and more than 60 per cent of all investment between the two regions.
The deal goes beyond many other free trade accords in committing to open up public procurement, an area where the EU has many leading suppliers, and agreeing on technical standards in areas such motor vehicles, electronics and green technologies. For example, a car made according to EU standards will be accepted for sale in Singapore.
The European Union also gains better protection of "geographical indications", region-specific products such as Parma ham or champagne.
EU tariffs on virtually all items from Singapore will disappear over five years. Singapore has committed to its existing zero tariffs on EU imports.
Singapore is likely to benefit from reduced tariffs for pharmaceutical and petrochemical products.
In services, particularly financial, the agreement will ensure the right to sell directly or establish branches in each other's markets and promises to provide greater transparency over the award of licences."
The Economic Times

European Union launches clampdown on shadow banking

Special funds used by big companies to park billions of euros of cash face stricter rules to make them safer, the European Commission said on Wednesday, taking a first step to reform unregulated finance known as shadow banking. The draft law will regulate money market funds, demanding some set aside cash buffers to avoid a panic should many investors withdraw their money at once.
This would lower what EU financial services chief Michel Barnier said was a risk to the financial system from the trillion euro sector but users of the funds warn that demanding they hoard more for a rainy day would make them too expensive.
The changes are part of efforts to shine a light on shadow banking, a 24-trillion-euro industry in Europe that comprises money market funds, some hedge funds, and firms involved in securities lending and repurchase markets. Such groups borrow and lend, just like banks do, but because they are not banks they often fall outside the remit of regulation, which is why they are considered to operate in the 'shadow' of traditional finance.
In the European Union, money market funds are mainly based in France, Ireland and Luxembourg and are heavily used by companies and banks which borrow from them. For companies, they are an alternative home for short-term cash. Unlike banks, they have no access to support from central banks such as the European Central Bank if things go wrong.
But the vast unchartered territory unnerves regulators in part because the sector is closely intertwined with banks, who often sponsor the funds as well as relying on them for finance themselves. "We have regulated banks and markets comprehensively," said Barnier, the EU Commissioner who has led a four-year revamp of financial rules. "We now need to address the risks posed by the shadow banking system."
The European plans draw on ideas in a global blueprint that will be submitted for approval to the world's 20 leading economies when their leaders meet in Russia on Thursday and Friday. In some cases, the EU reform is more ambitious.
The reform is a response to the 2007-2008 financial crisis, which was brought on by the collapse in prices of securities tied to risky home loans. "Shadow banking was at the heart of the crisis," said Frederic Hache, a former derivatives banker who works with public-interest group Finance Watch. "As bank regulation has since tightened, activity may shift into the shadow sector."
The most controversial element in Barnier's proposal is a requirement for one type of money market fund, known as constant net asset value (CNAV) funds, to hold a cash buffer equivalent to 3 percent of their assets.
Such funds seek to maintain a stable 1 euro per share when investors redeem or buy shares in them, to keep the value of their holding steady.
The buffer would provide a safety cushion in case there is a run on the fund, as seen in the United States when the value of one U.S. fund "broke the buck" and fell below $1 per share.
The industry says the reform would be too costly.
"Imposing a three percent buffer would make money market funds unviable," said Martin O'Donovan, deputy policy and technical director at Britain's Association of Corporate Treasurers. "To cover that, their rates would no longer be competitive."
Funds whose share price floats in line with performance are spared the buffer requirement. Imposing the buffer is meant to prompt CNAV funds to convert to funds with floating share prices, which are seen by regulators as more transparent. The funds in the EU, which include BlackRock and Legal & General, are evenly split between the two types.
The European Union's 28 member states and the bloc's parliament have the final say on the draft law and some changes are likely.
Barnier also published a "roadmap" on how the EU plans to move ahead with regulating other parts of the shadow banking sector, including a proposal to boost transparency by collecting and exchanging data among regulators. Banks could be required to hold more capital to cover risks from links to shadow banking. Shadow banking intuitions themselves could be required to hold capital, the EU executive said.
Reuters