Scotland's referendum - nothing and everything changes

"In the end nothing changed and everything changed. Scottish people voted with a decisive majority against independence on Thursday (18 September) but the conversation in the UK has only just begun.
David Cameron, seemingly invigorated by almost becoming the PM who oversaw the break up of the UK, has promised devolution for everyone. In Scotland, Wales, Northern Ireland and England.

In a speech after the outcome he said Scottish people "have kept our country of four nations together. it would have broken my heart to see our United Kingdom come to an end".
The EU, watching nervously from the side lines, also welcomed the result. The No outcome removed the immediate political and legal maelstrom of what to do with an EU state that has just had a bit removed; and what exactly to do with that independent bit.
But others are contemplating similar ideas. All eyes are now on Catalonia which has vowed to press ahead with an independence 'consultation' in November.
The immediate lesson seems to be that states need to listen to their independence-minded regions. Ignoring them, or dismissing them, only serves to fuel a sense of anger. Cameron's devolution promises came only when the prospect of a Scottish independence suddenly became very real.
In Spain, Madrid's tough stance has also given a sense of righteousness to those who want independence. And while Brussels was in a state of panic about the UK's possible break-up - the irony is that the EU can inspire such movements. It is seen as providing a safe harbour. If statelets break away they are not necessarily going out into the big wide world alone. They can become members of the EU. (Yes, the EU commission did all it could to make it sound unlikely, but Scotland would have eventually joined the bloc).
In Scotland's case, this would have left a smaller, traumatised UK. And with the EU reliant on its large member states for a sense of foreign policy and defence, this matters. Numerous statelets concentrating on their own internal well-being is not necessarily going to project power into the world. And this is probably what inspired European Commission President Barroso's statement - which his spokesperson later refused to elaborate upon - that Scotland's No leaves the EU "united, open and stronger".
Meanwhile, the next big question is whether Cameron chooses to make the same 'Better Together' campaign for EU membership as he did for Scotland staying into the EU. He has promised a referendum on EU membership in 2017 if his party gets re-elected next year. The devolution to-do list he has just given himself on the back of the Scotland referendum looks like a campaign platform for the general election.
It very much looks like the two questions - UK internal devolution and EU devolution to the UK - will become entwined. This would leave Cameron overseeing the two biggest domestic and European policy questions of a generation.
If the Scotland referendum has taught us anything for the EU question it is this: The UK needs to be clear about what it wants. And the EU should not descend into histrionics about a country asking for some, clearly defined, powers to go back to or be fixed at the national level."
Link to EuObserver

European Union delays Ukraine free trade deal implementation to end-2015

The European Union, Russia and Ukraine agreed on Friday to delay the implementation of an
EU-Ukraine free trade pact until the end of next year, EU Trade Commissioner Karel De Gucht said.
Ukraine will continue to enjoy privileged access to the EU market until that
date, he said, but it will not have to cut duties on imports from the EU in
return.
The move appears to be at least partly a concession to Russia, which fears the
EU-Ukraine agreement will harm its industry.
It has been urging the EU to refrain from implementing the free-trade pact with
Ukraine until its concerns over the agreement are addressed.
(...)"
Link to TheEconomicTimes

European Union Imposes New Sanctions On Russia

"New European Union sanctions against Russia announced Friday toughen financial penalties on the country's banks, arms makers and its biggest oil company, to punish Moscow for what the West sees as efforts to destabilize Ukraine.
(...)
The EU measures include:

• Further limits to some Russian companies' ability to raise money in EU markets. The restrictions now apply not only to banks but also to major oil company Rosneft, defense companies, pipeline operator Transneft, the oil subsidiary of energy giant Gazprom and others.
• Broader limits on the export of high-technology EU goods that could also be used for military purposes.
• Travel bans and asset friezes for another 24 officials. They include four deputy Parliament speakers and leaders of the separatists in eastern Ukraine. Also hit is businessman Sergei Chemezov, who is one of President Vladimir Putin's "close associates," according to the EU.
• Bans for EU companies on new contracts in oil drilling, exploration and related services in Russia's Arctic, deep sea and shale oil projects. Russia's Rosneft oil company is majority-owned by the state, but Britain's BP holds a 19.75 percent stake in it.

Conspicuously absent from the list was Russia's gas industry, because many EU nations depend on Russian gas imports.
The measures are likely to hurt Russia's already flagging economy.
"Even though (targeted) companies are not threatened with an immediate liquidity crisis, the banks and firms concerned will painfully notice, especially the stronger constraints for short-term refinancing," said the managing director of the Association of German Banks, Michael Kemmer."
Link to Huffington Post

Italy's Mogherini and Poland's Tusk get top EU jobs

"The announcement came in tweets from the current council president, Herman Van Rompuy, at an EU summit.
Ms Mogherini, a centre-left politician, is Italy's foreign minister. She will replace the UK's Catherine Ashton. Mr Tusk, Poland's centre-right prime minister, has been Polish leader since 2007. He will chair EU summits.
The full-time appointments mean that the EU's three top jobs are now filled. Mr Tusk and Ms Mogherini will work closely with the new European Commission President, Jean-Claude Juncker.
Mr Tusk, 57, will serve for two-and-a-half years (renewable), starting on 1 December. Ms Mogherini's term, starting on 1 November, is five years.
Mr Van Rompuy called Mr Tusk "one of the veterans of the European Council", the grouping of EU government leaders. He is the only Polish prime minister to have been re-elected since the collapse of communism in 1989. Mr Van Rompuy praised "the determined and confident way he has steered Poland through the economic crisis, and managed to maintain steady economic growth". As a student Mr Tusk was active in the Solidarity anti-communist movement.
Mr Van Rompuy said Mr Tusk would face three major challenges: the stagnating European economy, the Ukraine crisis and "Britain's place in Europe". He said the EU leaders were convinced that Ms Mogherini, 41, "will prove a skilful and steadfast negotiator for Europe's place in the world". He noted Italy's "long-standing tradition of commitment to the European Union".

'Huge challenges'

Mr Tusk then made a short address in Polish. He said that "in December I'll be 100% ready" to speak English.
Ms Mogherini, speaking fluent English, later said "the challenges are huge... all around Europe we have crises - on European soil, in Ukraine, and starting from Iraq and Syria, going to Libya".
On arrival at the summit the European Parliament President Martin Schulz, a Socialist, spoke warmly of Ms Mogherini, calling himself a "fan". It was a strong indication that she would be a popular choice among MEPs. The parliament's approval is required for all 28 members of the new Commission, and the EU foreign policy chief, officially called the High Representative, is also a vice-president of the Commission.
Baroness Ashton, a centre-left UK politician, has been in the job since 2009. The High Representative runs the EU External Action Service (EEAS). Italy's centre-left Prime Minister Matteo Renzi pushed hard for Ms Mogherini to get the job.
However, last month the EU failed to get a consensus on her candidacy, as the Baltic states and Poland saw her as inexperienced and too soft on Russia. She has only been Italian foreign minister since February. "
Link to BBC

Recovery in Eurozone halts

France has all but abandoned a target to shrink its deficit, as the eurozone endured a turbulent day that raised the prospect of a triple-dip recession. Figures published by Eurostat on Thursday (14 August) indicated that the eurozone economy flatlined between April and June, while the EU-28 saw 0.2 percent growth. (...)

Germany's output fell by 0.2 percent, the same as Italy, which announced its second quarter figures last week. France recorded zero growth for the second successive quarter, while finance minister Michel Sapin suggested that the country’s deficit would exceed 4 percent this year, missing its European Commission-sanctioned 3.8 percent target.

In an article in Le Monde on Thursday (14 August), Sapin abandoned the target, commenting that “It is better to admit what is than to hope for what won't be." France would cut its deficit "at an appropriate pace," he added in a radio interview with Europe 1. Pointing to the contraction of the German economy, Sapin remarked that "the EU's big engine, Germany, is today negative. There is therefore a French problem and a European problem".

Sapin’s admission is another setback for beleaguered President Francois Hollande, who made hitting the 3 percent deficit target spelt out in the EU’s stability and growth pact by 2013 one of his key election pledges in 2012. Paris has now revised down its growth forecast from 1 percent to 0.5 percent over the whole of 2014, and cut its projection for 2015 to 1 percent from 1.7 percent.

France has already been given a two year extension to bring its deficit down to within the 3 percent limit by 2015, a target which now appears almost impossible to attain.

(...)
Euobserver

European Union imposes new sanctions against Russian officials following Ukraine crash

The European Union agreed Tuesday to impose new sanctions against Russian officials deemed responsible for the country’s actions in Ukraine, amid growing international anger after Malaysia Airlines Flight 17 was shot down over rebel-held territory.

European foreign ministers stopped short, at least for now, of more forceful sanctions that would hit full sectors of the Russian economy.

The EU agreed to impose visa bans and asset freezes on more Russian officials, Dutch Foreign Minister Frans Timmermans said. He did not say how many officials were targeted or reveal their names.

(...)

Link

EU's next challenges are geopolitical

"The shooting down of Malaysia Airlines Flight 17 with 298 people on board has dramatically raised the stakes in the war between the government of Ukraine and the pro-Russia separatists in the Donetsk region on the EU's eastern border. If Russian involvement is proved, calls for a far tougher European response than has so far been contemplated will surely be impossible to resist. Meanwhile, the EU faces massive instability along its southern border in Syria, Israel and the Palestinian territories, Egypt and Libya. European leaders have also been anxiously looking at recent political unrest in Turkey.

...

these geopolitical risks could represent a threat every bit as severe as the euro crisis to Europe's cohesion and financial stability. And as with the euro crisis, the solution is likely to lie in closer integration. But the fact that integration is necessary doesn't make it any easier to achieve."

Link

Juncker elected

Jean-Claude Juncker was elected European Commission President on Tuesday (15 July) after promising a more social Europe and paying tribute to the major integrationist politicians of the previous generation. The former Luxembourg PM, who has been on and around the EU stage for the last two decades, received 422 votes, easily surpassing the minimum 376 needed. Of the 729 MEPs that took part, 250 voted against him, 47 abstained and 10 votes were void. 

In a 50-minute speech before the ballot, the centre-right politician said he wanted the European Commission to be "very political" and indicated he will try and revive the power of the institution - seen as sidelined after member states handled the long-running economic crisis. 

He pledged to revive the "community method" - whereby the EU commission is the driver of EU law-making and strongly differentiated himself with the outgoing commission - which is associated with austerity-flavoured policies - by giving major focus to social issues in his speech. "You can't achieve competitiveness by getting rid of social security," he said, noting that the "internal market is not more important than social affairs."

He pledged to use €300bn over the next three years for projects that focus on energy, infrastructure, and digital issues. Other promises include making a lobbyist register obligatory, making documents around a controversial EU-US trade agreement public, and putting an end to the EU dealing with "every tiny problem".

He spoke of the eurozone eventually having its own budget and said the single currency area should be "represented by one single chair, one single office". But he said the stability and growth pact - the rules underpinning the euro - will not be changed. 

He also promised to tackle "social dumping", but to leave free movement of people rules intact. He will work for a common asylum policy, and indicated there will be no new EU member states under his watch.

More...

European Union leaders signal shift from austerity

In the latest shift away from the austerity of the euro zone crisis, European Union leaders signalled at a summit that they were ready to give member states extra time to consolidate their budgets as long as they pressed ahead with economic reforms.

Under pressure from Italian Prime Minister Matteo Renzi, the leaders adopted a text which pledged to make "best use" of the flexibility built into the bloc's fiscal rule book - the so-called Stability and Growth Pact. Renzi, whose country has the second biggest debt in Europe at more than 135 per cent of gross domestic product ( GDP), has been pushing for a more growth-friendly interpretation of the fiscal rules since taking office in February, because without faster growth Rome won't be able to pay down its debts. 

"If a country enacts serious structural reforms, it has the right to flexibility, which is the most important political point," Renzi told reporters at the end of the two-day summit. He called the new language a "turning point" for Europe. 

In reality, Europe has been shifting towards a softer fiscal stance since last year in an effort to revive growth in struggling southern states, and combat high unemployment, particularly among young people.

Countries like France and Spain have already been given extra time to reach the EU's deficit target of 3 per cent of gross domestic product (GDP). In parallel, the European Central Bank (ECB) has cut interest rates to record lows to ward off the threat of Japanese-style deflation in the 18-member euro zone Germany, the most ardent defender of tough budget policies, has been worried that fiscal leniency could lead to a new spending spree by governments taking advantage of low borrowing costs and open the way for a new crisis.

ITALIAN-GERMAN DEAL

But Renzi and German Chancellor Angela Merkel reached a deal late on Thursday which stresses the need  or a flexible interpretation of fiscal rules, while stopping short of any change to the EU pact. Merkel stressed at a news conference that it would be up to the European Commission, not member states themselves, to decide whether extra time was granted. "The best use of flexibility means the best use, not the fullest use but the best, the most appropriate for the situation," Merkel said. 

Under EU rules, governments have to strive towards a budget close to balance or in surplus, excluding one-off revenue and spending and the effects of the business cycle. They also have to reduce public debt. But the rules also say that governments can be given more time to reach budget balance if they undertake reforms that have a verifiable positive impact on economic growth - an option that has so far never been used. "Structural reforms that enhance growth and improve fiscal sustainability should be given particular attention, including through an appropriate assessment of fiscal measures and structural reforms, while making best use of the flexibility that is built into the existing Stability and Growth Pact rules," the text agreed by leaders read.

Link

Ukraine sings trade pact that sparked revolution

"Dealing a defiant blow to the Kremlin, President Petro O. Poroshenko of Ukraine signed a long-delayed trade pact with Europe on Friday that Moscow had bitterly opposed. He then declared he would like his country to one day become a full member of the European Union.

In so doing, Ukraine’s new leader, a billionaire confectionary magnate, has in effect raised a risky bet on the West that has cost his country hundreds of lives and the loss of the Crimean peninsula to Russia and has set off a low-level civil war in its eastern border region.

By signing the trade pact at the Brussels headquarters of the European Union, Mr. Poroshenko revived a deal whose rejection last November by his predecessor, Viktor F. Yanukovych, set off months of pro-European protests in Kiev, the Ukrainian capital, and pushed the West into its biggest test of wills with Russia since the end of the Cold War.

(...)

The completion of the association agreement between the European Union and Ukraine marked a severe setback for President Vladimir V. Putin of Russia and his oft-repeated goal of reasserting Russian influence in the “near abroad,” Moscow’s term for the territories of the former Soviet Union.

(...)

Moldova and Georgia, two other former Soviet lands that Moscow had pressured not to stray too far from its orbit, also signed agreements with the European Union on Friday. In Tbilisi, the capital of Georgia, citizens celebrated with a large public concert, which was broadcast on all major domestic television channels.

(...)

Within minutes of the signing ceremony, the news agency Interfax quoted Russia’s deputy foreign minister as warning that “serious consequences” would follow. The remark was an ominous sign of the vexation caused in Moscow by the tilt toward Europe of lands that Russia, first under czarist and then Soviet rule, for centuries considered its own.

(...)

There is no chance of the European Union admitting Ukraine, Georgia or Moldova as members any time soon. Public opinion in Europe is hostile to any further expansion of a 28-nation bloc that is already widely seen as too big and too unwieldy.All the same, Europe’s allure to so many people in former Soviet territories has infuriated Moscow, not the least because it contrasts so starkly with the cool reception given Mr. Putin’s efforts to form a rival economic bloc, the Eurasian Union, which is to start up next year. It so far has only three takers, Russia, Belarus and Kazakhstan.

(...)

Senior Russian officials quickly began warning that Russia’s businesses and economy could suffer, as their markets could be flooded with low-cost goods from Europe that skirt tariffs by first being shipped through Ukraine, which will be exempt from most European duties. Other experts have dismissed those concerns, saying Russia is quite adept at identifying and intercepting such goods as they cross the border.

European leaders, meeting Friday at a summit in Brussels dominated by wrangling over who should lead its executive arm for the next five years, announced that they would not immediately impose additional sanctions on Russia for its interference in Crimea and eastern Ukraine. But, they said in a statement that additional sanctions were being prepared and could be deployed “without delay” if Russia does not do more to curb violence in eastern Ukraine.

(...)"

Link

Results of the EU elections

These are only preliminary results, composition of the various political groups may change later, as the new EP forms.

May EU Summit

EU leaders wrestled Tuesday for a joint response to a dismal European vote that saw dramatic gains by radical anti-establishment parties, with Britain, Germany and France calling for EU reforms.

The anti-EU surge shows the European Union has got "too big and too bossy", said British Prime Minister David Cameron on arriving for an informal summit due to take stock of the election disaster.The vote "is a clear message that we cannot just shrug off... and carry on as before," he added. "The EU has got too big, too bossy, too interfering and needs to concentrate on growth and jobs."

France's President Francois Hollande, after his humiliating thrashing at the hands of the far-right National Front, also took aim at Brussels: "Europe must take heed of what happened in France," he said. The National Front topped the vote, leaving Hollande's ruling Socialists in third place with a mere 14 percent. 

Also on the leaders' dinner menu -- and perhaps just as difficult to digest -- will be tough talks on the nomination of new leaders for the different Brussels bureaucracies, in particular the presidency of the powerful European Commission.

Germany's Angela Merkel and Hungary's Viktor Orban stepped into the talks, however, publicly differing over their support for the candidate elected by the European Parliament conservatives -- ex-Luxembourg premier Jean-Claude Juncker. The conservatives are set to be the leading group in the next 751-seat parliament and Merkel said she supported Juncker, but Orban disagreed. 

The four-day European Parliament election that ended Sunday served up a clear message of voters fed up with economic distress, belt-tightening austerity, immigration and, most of all, aloof and meddlesome bureaucrats in Brussels. After decades of striving to tighten EU integration with "more Europe", many Europeans seem to believe that is no longer the answer.

Cameron, who has one eye on national elections next year, saw anti-EU outsider -- the UK Independence Party (UKIP) -- make history by topping polls in Britain. 

The vote may have produced a "big dissident voice", said UKIP leader Nigel Farage, (but)... I have just sat in a meeting where you would think nothing had happened at all, it was business as usual."

In contrast to Cameron and Hollande, Merkel came out of the Parliament elections relatively unscathed, delivering her usual message of the need for "growth and jobs... the best answer" to the EU's current malaise. 

Final figures for the four-day election have yet to be released but the latest projections give the conservative European People's Party (EPP) 213 seats out of 751, with the Socialists on 190 and the Liberals 64.That will give the centre-right, centre-left and Liberals a solid working majority.

But the eurosceptics, xenophobes and even outright fascists about to sit in parliament and win EU funding, along with radical left groups, will gain a platform for their views as well as scope to slow down the assembly's legislative process.The anti-EU camp will have about 140 seats though analysts say it will be difficult for the disparate groups to operate in a coherent fashion.

The summer meanwhile will see all the EU's top officials replaced, beginning with a new president of the Commission, the EU's executive arm which proposes and enforces laws. 

In previous years, this was the entire prerogative of the bloc's national leaders, nominations discussed among themselves behind closed doors. But the latest rules in the EU bible, set down in the Lisbon Treaty, state somewhat ambiguously that they must "take into account" the people's voice via the election results. On that basis, the five main parliament groups elected their own candidates for Commission president and warned they fully expected EU leaders to name one of them to the post. 

As Parliament is the EU's only directly elected body, they argue, this would be the best way to bolster the bloc's democratic credibility. On Tuesday, European Parliament party leaders agreed to back Juncker Commission president as his EPP topped the vote. Should he fail to put together a 376-seat majority in parliament then the job could fall to Martin Schulz of the second-placed Socialists.

A refusal by the national leaders to accept the Parliament's candidates could lead to an institutional crisis. "Our point is that theres no automatic connection between the outcome of the election and the nomination," said Hungary's Orban.

The process is expected to take weeks, perhaps months, with one senior EU official warning "there will be no white smoke" signalling a choice has been made at Tuesday's dinner.

TheEconomicTimes

EU, Ukraine sign aid deals worth $1.78 billion

Ukraine’s prime minister and European Union officials on Tuesday closed deals for a total of 1.3 billion euros ($1.78 billion) in EU assistance that Kiev could use to pay its energy bills, combat corruption and reform its institutions. (...)

In March, leaders of the 28-nation EU agreed on 11 billion euros in short-, medium- and long-term assistance for Ukraine. The memorandum signed Tuesday is for 1 billion euros in loans for macrofinancial assistance. Barroso said the first installment of 600 million euros would be disbursed soon, following ratification of the arrangement by Ukraine’s parliament.

EU officials told reporters the funds could be used to help pay Russia for natural gas purchases — a matter of dispute between the two countries. The EU loans were made contingent on the Ukrainian government committing itself to fiscal and economic reforms.

A separate “state-building contract program,” evaluated by the EU as worth 365 million euros, is intended to help Ukraine implement reforms, fight corruption, promote social and economic development and expand government capacity, Barroso said.

Link to Washingtonpost

EU sanctions target 15 individuals

The European Union has imposed sanctions related to the crisis in Ukraine on another 15 people, bringing the total number targeted to 48.
The EU said the people are collectively responsible for actions that "undermine or threaten the territorial integrity, sovereignty and independence of Ukraine."
The targets include Dmitry Kozak, Russia's deputy prime minister; Russian military chief Valery Gerasimov; and pro-Russian separatists in Ukraine, including Denis Pushilin, the self-declared leader of the "Donetsk People's Republic."
More at CNN

EU parliament gives final nod to banking union

MEPs on Tuesday (15 April) overwhelmingly approved the creation of a new authority and fund for failing banks – a missing element to the so-called banking union aimed at minimising the public cost of future financial crises.
The final vote on the creation of a €55 billion fund financed by the banks themselves passed with 570 MEPs in favour, 88 against and 13 abstentions, while new rules in cases where public money needs to be used for winding down banks also gathered a similar majority: 584 votes in favour, 80 against and 10 abstentions.
One key concession won by MEPs from governments during final negotiations was a speedier mutualisation of the fund, which will comprise of domestic bank levies paid into "national compartments". Forty percent of the fund is to be mutualised in the first year, 20 per cent in the second year, the rest equally over a further six years.
There will also be an obligation for EU countries to guarantee up to €100,000 in any savings account, but there is no common backstop in case they fall short.
A first element of the 'banking union' – single supervision of the 130 largest eurozone banks – is to become operational in November within the European Central Bank. The resolution mechanism will be independent, but take advice from the ECB as to when to step in to help or to close down a troubled bank.
Euobserver

European Union Condemns Crimea Referendum

The European Union on Sunday condemned the referendum in Ukraine's Crimea as illegal and is taking steps to increase sanctions against Russia over what many believe is a planned annexation of the bordering peninsula.
The contested vote on Crimea joining Russia further acerbated relations with Moscow, which has changed from a wary partner to a diplomatic adversary in the space of a few months. But the EU increasingly realizes change might not be imminent. (...)
Presidents Barack Obama and Vladimir Putin of Russia spoke after Crimea residents voted overwhelmingly to join Russia. Obama told Putin that the referendum would never be recognized by Washington. Obama also told him the vote violates the Ukrainian constitution and occurred under duress of Russian military intervention. He said the U.S. was prepared to impose additional penalties on Russia.
Link

Latvia joins eurozone

Latvia became the 18th country to join the eurozone on Tuesday (1 January). Joining the currency is "a big opportunity for Latvia's economic development," Prime Minister Valdis Dombrovskis said as he became the first Latvian to withdraw euro banknotes in Riga.
(...)
The country has one of the lowest levels of government budget deficit and debt in the EU at 1.2 percent of GDP and 40.7 percent of GDP, respectively. (...)
http://euobserver.com/news/122622

France, Germany and UK show discord on EU defence

EU countries have agreed to "deepen defence co-operation," but France, Germany and the UK disagreed how to do it at a summit in Brussels on Thursday (19 December).
France went into the meeting calling for a new EU fund to help pay for member states' unilateral operations - such as the French intervention in Mali or the Central African Republic (CAR) - if they serve European security. He did not get it.
German Chancellor Angela Merkel said France cannot to go to war on its own just because the EU makes decisions slowly and then expect the Union to chip in. "We cannot fund military missions in which we are not involved in the decision process," she told press after the defence talks. She added that a separate defence ministers' meeting would be needed to transform the French CAR operation into an EU intervention.
French leader Francois Hollande played down the German snub. He said the EU foreign service will draft a study on his new fund idea in the first few months of next year. He added that Poland might, on Friday, agree to also send troops to CAR, in a development which would trigger financial support from an existing EU military aid package - the so-called Athena mechanism of 2004. "The moment this happens, this will be considered a European operation and ... there will be European funding," he noted. He also said French spending on Mali and CAR will be "an element of explanation" in future talks with the European Commission on France's budget deficit for 2013 and 2014.
For his part, British Prime Minister David Cameron said he will block EU institutions from owning and operating their own military assets. "It makes sense for nation states to co-operate over matters of defence to keep us safer … but it isn't right for the European Union to have capabilities, armies, air forces and all the rest of it," he told media. He also persuaded fellow leaders to dilute the political rhetoric on joint defence.
In one example, a draft text of the summit conclusions had said in its preamble that EU countries will "strengthen [their] strategic autonomy." But on Thursday the phrase - a French concept - was bumped down to page eight of the 10-page communique, which said better industrial co-operation would "enhance its [Europe's] strategic autonomy."
The final text also underlined the primacy of Nato as Europe's security guarantor. The commission proposed back in July that it should "own and operate" its own surveillance drones. The head of the European Parliament, Martin Schulz, on Thursday also said: "We need a headquarters for civil and military missions in Brussels and deployable troops."
But fellow leaders accused Cameron of politicking for the sake of eurosceptic votes at home. Hollande indicated that member states discarded the commission proposal long ago. "This [Cameron's] statement was, in my opinion, for the large part, a bit false … Nobody envisages the creation of a European army," the French President said.
Nato chief Anders Fogh Rasmussen, who attended the summit, sympathised with Cameron's concerns. "Nato is and will remain the bedrock of Euro-Atlanic security," he said. But he added: "Let me stress: It is not Nato or the EU that possess [military] assets. They are owned by the individual nations."
The final summit communique said EU countries will co-operate on four projects.They pledged to build what Hollande called a "common drone" by 2025 at the latest. They promised to create a bigger fleet of air-to-air refuelling tankers, to work together on "next generation" satellite technology and to do joint training on cyber defence.They also said EU institutions should spend more money on military R&D and draft a new "EU Maritime Security Strategy."
Meanwhile, Rasmussen repeated his earlier warning that the 22 EU countries which are also Nato members must make a bigger contribution to Nato missions."Unless we Europeans take our security seriously, North Americans will rightly ask why they should. Unless we recommit to our own defence, we risk seeing America disengage, and Europe and America drift apart," he said.
The same day in Paris, French defence minister Jean-Yves Le Drian showed to what extent European armies depend on US technology. He said France will shortly deploy the first two of its 12 new "Reaper" drones to hunt jihadists in Mali and Niger. But with no European firm able to supply competing surveillance equipment, France bought the Reapers from US company General Atomics.
Euobserver

Ukraine opts for Russian bailout instead of EU treaty

Ukrainian leader Viktor Yanukovych has opted for a no-strings-attached Russian bailout instead of the EU alternative.He made the agreement at a meeting with Russian President Vladimir Putin in Moscow on Tuesday (17 December). 

Under the accord, Putin promised to use money from Russia's National Welfare Fund to buy $15 billion of distressed Ukrainian bonds. He also promised to cut gas prices from $400 or so per thousand cubic metres to $269 until 2019, saving Ukraine up to $2 billion a year.

(...)

Euobserver

Ukraine’s EU ‘U-turn’ dominates East Europe talks

"The Eastern Partnership Summit between EU and Eastern European leaders starts Thursday in Vilnius in the shadow of Ukraine’s decision to scrap a key trade deal with the EU following pressure from Moscow.

Ukrainian president Viktor Yanukovych has nonetheless said that he will attend the meeting. “Yanukovych said that he wanted to come and explain himself to his European counterparts, but the real reason is that the negotiations here in Vilnius are still going on right up until the last minute,” said FRANCE 24’s Gulliver Cragg in the Lithuanian capital. 

While the Ukrainian government has admitted to pulling out of the deal with the EU after pressure from Russia, diplomats were still discussing possible concessions on Wednesday. On the fourth day of mass pro-European street protests in Kiev, the Ukrainian prime minister said his government still wanted to strike an agreement with the EU.

“The document is physically on the table here in Vilnius,” Cragg said. “But Yanukovych’s main purpose here will be to convince the EU to have three-way talks with Russia.” He added that European officials were divided on the prospect of negotiations with Russian President Vladimir Putin’s government over their competing spheres of influence in Eastern Europe.

From Moscow, Guardian correspondent Shaun Walker told FRANCE 24 that a deal with Ukraine was unlikely this week but that this may be only a temporary delay. “Eventually they do want European integration, but it’s just not the right economic decision for them right now,” he said. Ukraine is heavily dependent on Russia for trade and energy supplies, and the EU’s offer appears to have been insufficient to counter Moscow’s threats of commercial retaliation.

Although Ukraine is the largest and most visible of the six countries engaged in the much-lauded EU Eastern partnership, Walker said it was not the first time Europe’s efforts to develop ties in the region have been thwarted by Russia.

“Armenia was another country – all the paperwork was ready to sign on the dotted line. A couple of months ago Vladimir Putin travelled there and the next day, Armenia announced it wasn’t joining this EU partnership – that it was in fact joining Russia’s EU-style Customs Union,” he said.

Walker and Cragg both argue that the European Union’s image and diplomatic clout have suffered in the Ukrainian rapprochement fiasco – at least in the short term. However, two other former members of the Soviet bloc, Georgia and Moldova, are due to sign free trade agreements with the EU in Vilnius. Russia’s deputy prime minister has already warned that it will apply pressure to these countries as well."

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