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☘Lisbon Treaty News: McCreevy proud – Europe would vote “No” / Guarantees Worthless / Big Brother EU / Hidden Tax Plan
EUOBSERVER / BRUSSELS –
While EU and other global leaders have talked tough about re-regulating the financial sector in the wake of the economic crisis, they remain committed to pushing through banking deregulation in the developing world via trade deals.
This strategy is undermining poverty reduction in these countries and is reproducing the same type of circumstances that led to the crisis in the first place, warns a new report published on Wednesday (11 March) by the World Development Movement, an UK-based anti-poverty NGO.
Both via the WTO negotiations on a General Agreement on Trade in Services (GATS) and potential EU bilateral or regional trade deals with 34 countries in Latin America, Asia and the Mediterranean, the bloc continues to push for the lifting of restrictions on how Western banks operate in developing countries.
The EU In 2002, via “GATS” global trade talks, requested that 94 countries open up their financial industry, 20 of which were least developed countries and 30 were low income countries.
A financial services component of GATS would mean that countries would not be able to introduce new rules that are more restrictive than those already operating, making it difficult to pass laws on risky trading such as “short-selling” or to limit the numbers of service providers or the number of transactions.
All new financial services would also have to be permitted, giving the green light to the very same complex financial products that have been held responsible for the creation of the toxic asset problem in the north.
Also under GATS, full ownership by foreign banks would be allowed, which can make it hard for a host country’s financial supervisor to monitor the foreign bank’s activities and to ensure it is acting in the interests of the host country.
Even in the EU, the problem of foreign bank ownership is exacerbating the crisis in the east. The tap of credit to much of eastern Europe – where most of the banks are owned by Austrian, Swedish and other EU parent companies – today has been all but turned off, as the owners focus on provision of credit in their home markets.
After seven years of talks, however, countries are still haggling over a GATS deal, and the EU has sought bilateral and regional trade deals to get over the impasse.
The bilateral strategy, known as “Global Europe,” seeks to remove regulations on European financial service companies, along with other liberalising measures in a range of sectors, in case a deal at the WTO level is not reached.
The EU trade deals already signed with Chile and Mexico contain substantial chapters on financial services, while the Caribbean Economic Partnership Agreement with the EU signed in October last year contains many of the financial liberalisation clauses proposed in GATS. Similar pressure on central American nations is being brought to bear to open up their financial sectors.
The report reveals that where banking liberalisation has occurred, looking in particular at India and, crucially, Mexico – home to one of the most liberalised financial sectors in the world, with 80 percent foreign ownership, poor people and small businesses see their access to credit, bank accounts and other financial services restricted.
At the same time, where such credit does exist, it is in the form of credit cards, car loans or mortgages, boosting spending on consumer items rather than productive sectors of the economy such as farming or manufacturing.
On Monday (9 March), UK Prime Minister Gordon Brown himself spoke out against the “do as we say, not as we do” attitude of Western countries regarding economic policies promoted to the developing world.
At an international development conference in London, he announced that he would push the World Bank and other wealthy nations to create a new fund for developing countries to help the poor through the crisis, although he did not attach any figures to the idea.
While there, he criticised the imposition of “economic orthodoxy” on the developing world.
“Too often in the past our responses to such crises have been inadequate or misdirected – promoting economic orthodoxies that we ourselves have not followed and that have condemned the world’s poorest to a deepening cycle of poverty,” he said.
The World Development Movement (WDM) however, says that there is an acute contradiction between such leaders’ words and deeds in pushing for financial deregulation in the third world.
“On the one hand, Gordon Brown has developed a mantra of tough talk on the re-regulation of banks,” said Benedict Southworth, the director of WDM. “On the other, together with other European leaders, he is aggressively pushing free trade deals which demand that developing countries follow a deregulated and liberalised banking model.”
“That model has clearly and spectacularly failed here and has also failed poor people in the developing countries,” she added.
The study highlights how the presence of European banks in developing countries has resulted in foreign banks cherry-picking the richer customers, resulting in an overall decline in services and credit for others, and notably to rural areas.
In urban areas where foreign banks are concentrated, low-income householders and small businesses struggle to meet the criteria to open an account, let alone to receive a loan.
In response, WDM is calling for financial services liberalisation to be reoved from from proposed bilateral and multilateral EU trade deals.
An official with the European Commission told EUobserver that they were studying the report very closely, but that the report’s authors had “confused liberalisation with deregulation.”
“Market access for European financial service providers in no way restrains the ability of countries to regulate financial services,” the official said. “The question is whether such moves become protectionist.”
Filed under: EU Foreign Policy | Clibeanna: Chile, developing countries, eu observer, EU trade deals, financial deregulation, GATS, General Agreement on Trade in Services, Global Europe, liberalisation, Mexico, poverty reduction, third world, WTO | Leave a comment »
Myth 1. LISBON WILL MAKE THE EU MORE EFFICIENT: If you get rid of democracy and the need to consult with people, you can certainly get more laws passed. But will they be good laws? Is that more efficient government? When it comes to law-making it is quality that counts, not quantity. Hitler could issue new laws ever five minutes, but were they good laws? The advent of 12 new Member States has not made the negotiation of new EU laws more difficult since they joined the EU. On the contrary, a study by the Science-Politique University in Paris calculated that new rules have been adopted a quarter times more quickly since the enlargement from 15 to 27 Member States in 2004 as compared with the two years before enlargement. The study also showed that the 15 older Member States block proposed EU laws twice as often as the newcomers. Professor Helen Wallace of the London School of Economics has found that the EU institutions are working as well as they ever did despite the enlargement of the EU from 15 to 27 members. She found that "the evidence of practice since May 2004 suggests that the EU's institutional processes and practice have stood up rather robustly to the impact of enlargement." The Nice Treaty voting arrangements thus seem to be working well. Myth 2. LISBON ENABLES THE EU TO DEAL WITH CLIMATE CHANGE:
Lisbon provides that if one-third of National Parliaments object to the Commission’s proposal for an EU law, the Commission must reconsider it, but not necessarily abandon it (Protocol on the Application of the Principles of Subsidiarity and Proportionality, Art.7.2). It might review the draft law, or if it considered the objection was not justified, it might ignore it. This right to complain, for that is what it is, is not an increase in the powers of National Parliaments, as it has been widely misrepresented as being, but is symbolic rather of their loss of real power. To say that it is an increase in the power of National Parliaments to “control”, or even to affect, EU legislation is a blatant lie. Lisbon takes away major law-making powers from National Parliaments. It would give power to the EU to legislate in relation to some 32 new policy areas, thereby removing these areas from decision by National Parliaments. It also gives the EU the power to decide many other matters.
Lisbon would increase the power of the European Parliament by giving it many new areas of new EU law which it could propose amendments to, but that does not compensate National Parliaments and the citizens who elect National Parliaments, for their loss of power to decide. The new EU laws would still be PROPOSED exclusively by the non-elected Commission and would then be MADE primarily by the Council of Ministers, mainly on the basis of population-based voting. The EU Parliament can only amend these EU laws if the Commission and Council agree. Ireland would have 12 members out of 750 in the European Parliament under Lisbon,a reductuon from the current 13. When we had 100 out of 600 MPs in the 19th century UK Parliament, the Irish people were not that happy with the laws that were passed there. Yet Westminster was a real Parliament which decided all UK laws. The Irish representatives could propose laws in it, as they cannot do in the European Parliament.
If someone says that it is the National Government which really decides what laws are passed in the Dail or Parliament, because the majority of TDs or MPs belong to the Government party, and the EU Commission is acting like a national government in proposing EU laws, the obvious reply is that National Governments are elected by National Parliaments, who in turn are elected by the national citizens. But the EU “Government”, the Commission, is not elected. It is appointed by the Commission President and the EU Prime Ministers and Presidents on the basis of qualified majority voting.
EU ASKS GOVERNMENT FOR IRISH TROOPS FOR THE CONGO Xavier Solana, former NATO secretary-general and aspiring EU Foreign Minister, is asking the Government to Irish troops to the Congo as part of an EU force to supervise elections there. Belgium, the Congo's former colonial ruler, which raped the entire region during the reign of its King Leopold 2,is backing Solana's request. So is France. Belgium and France were complicit in the massacre of of 700,000 Hutus in next-door Rwanda during two months in 1994 - the biggest mass slaughter in history in such a short period of time. Franco-Belgian support for the Hutu forces which then fled to the Congo was crucial in destablising the entire region over the past decade. Local proxies for Belgium and France have been fighting a civil war in the Congo all that time. Now France and Belgium want Ireland and smaller EU countries like Sweden to act as their frontmen in the area, flying EU or UN flags rather than the Belgian and French tricolours. The former Central African colonial powers are willing to provide troops for this Congo mission, but are unwilling to be nominally in charge. They want some country like Ireland or Sweden to be that, thus providing an EU fig-leaf for this latest proposed EU adventure. African troops, not Irish ones, are the most appropriate for the Congo - if outsiders are really needed there at all. If African governments do not have enough money to pay for such troops, then let the UN give them the money and let Ireland contribute financially through the UN. Irish troops have no business today in that part of the world,for they will effectively be there to serve Franco-Belgian interests under ther guise of an EU flag. When Irish troops were last in the Congo,in 1961, the situation was quite different,for there were no independent African countries able to contribute. That is quite different now. What does South Africa think of this EU proposal? Defence Minister Willie O'Dea will be quivering to take part. O'Dea can see himself being blooded as an international warrior on a new Congo mission. If Irish soldiers are killed in this latest proposed Congo lunacy, their blood will be on the heads of O'Dea, Foreign Minister Dermot Ahern and Taoiseach Bertie Ahern for failing to tell Xavier Solana to get lost. _____________ *** EU PROPOSES COMMON MILITARY BUDGET The head of the European Defence Agency (EDA), Nick Witney, has requested 50 million euros to create what French daily Le Figaro on 10 Feb. called "the first common European defence budget." At a conference on 9 February European Defence Ministers discussed giving the EDA a budget to allow common European defence projects to go ahead, such as the building of a military helicopter. While the French encouraged the initiative, the UK was said to be "hostile", and Germany "cautious". The proposal will be discussed again at a meeting of EU Defence Ministers on 6 and 7 March in Innsbruck, Austria, which our own Willie O'Dea is expected to attend. How much of our money will O'Dea offer to contribute?
*** JOINING EU BATTLE GROUPS Ireland is to join in EU "battle groups" and send Irish soldiers off possibly to die on EU military missions. But Irish neutrality will not be affected, squirms Defence Minister Willie O'Dea - he who recently had his photo taken squinting down a gun barrel on the front page of the Sunday Independent. Irish "neutrality" is an ever more tattered remnant these days, after years of Dublin politicians cosying up to the EU and NATO. "Peace groups" would be a better name than "battle groups", says the ineffable O'Dea, a Limerick solicitor who clearly prefers being boss of the Irish Army and being photoed playing with war-toys to conveyancing and shuffling legal affidavits. What business has the EU sending troops to foreign parts, supposedly to make peace between people who are at war, but in reality to push the interests of the former colonial powers under an EU flag rather than less acceptable French, British, Belgian or Italian flags? "Peace-KEEPING" is one thing, for it implies there is already a peace to be kept. "Peace-MAKING", on the other hand, really means war-making, for it implies clobbering existing belligerents on the head to get them to stop fighting. The proposed EU military missions will be mainly in Africa. The former African colonial powers who decide EU foreign policy whenever they can agree among themselves, regard Africa as their backyard, just as the USA regards Latin America as its. EU battle groups and the EU Rapid Reaction Force of 60,000 men which the Dublin Government has also committed itself to joining, are central to the project of turning the EU into an imperial superpower,in which Ireland goes along with a collective neo-colonial foreign policy and its back-up military adventures. Top officers of the Irish Army are delighted as they fly off to take part in the EU Military Planning Staff in Brussels. There they are in with the big boys as they plan the military side of the EU Empire-in-the-making. Meanwhile Fianna Fail Ministers assure everyone that "Irish neutrality" is unaffected and unchanged. What fools they take people for! Eamon De Valera assuredly must be turning in his grave.
*** WAR WARNINGS ON USEFUL INFO WEB-SITE "German-foreign-policy.com" is a critical web-site full of useful insights into German foreign policy. German foreign policy is more or less the same as EU foreign policy these days. The web-site tells us that new German Chancellor Angela Merkel demanded more German influence in NATO at a joint armaments conference with the USA in Munich earlier this month. Merkel says she wants to increase the force of impact of the Western war alliance through worldwide cooperation with third states. This supplements US plans. According to US Defense Secretary Donald Rumsfeld at the Munich conference, the NATO member states must decisively augment their defense budget in order to relieve the corresponding US budgets, which now amount to 600 billion US Dollars. The new German-American programme seeks to extend the deployment of NATO to the China Sea and is clearly directed at Beijing. The intended entry of Georgia and the Ukraine into NATO, which was announced at the Munich meeting, raises tension with Moscow. At the same time the Islamic world is being threatened with war. Germany's Defense Minister has spoken of an assault ("military strike") on Iran but "at present" excludes this option. The comprehensive German-American alliance plans lead to a further reduction in the global political significance of France.
*** EU INTERFERES IN SERBIA-MONTENEGRO The EU has welcomed the election of a new pro-independence leaderin Kosovo, while urging Montenegran and Serb politicians to agree on an upcoming referendum that could break up the Serbia-Montenegro alliance. What business is it of the EU to be backing independence for the former Serbian territory of Kosovo or to be trying to break apart what in international law is still the sovereign State of Serbia-Montenegro, the last remnant of former Yugoslavia? The real reason they are doing this is to make it easier for German, French and Italian investors to buy assets in these countries, and above all to buy land in some of the most beautiful areas of Europe. What business is it of Irish Foreign Minister Brian Cowen to be backing such schemes and identifying us all with them? It is a further example of Ireland getting ever more sucked into EU neo-imperialism. Remember former German Foreign Minister Herbert Genscher's comment on the break-up of former Yugoslavia?: "A great victory for German foreign policy". And the same gentleman's comment on the disappearance of Czechslovakia and Yugoslavia, states first established in 1919?: "We have liquidated the heritage of World War I." The several small succcessor states left behind are much more easily gobbled up by German and other EU capital,and Serbia-Montenegro are just the last juicy morsels left.