Daily Digest: Eurozone unemployment reaches new record

Following the president of the Commission, Jose Manuel Barroso and EU Justice Commissioner Viviane Reding, the Austrian government also announced yesterday that it would boycott all Euro 2012 football matches in Ukraine. German Chancellor Angela Merkel might boycott the games as well, but she says she will wait till the last minute to decide. She does add that state of law in Ukraine is a “cause for concern”, referring to the jailing of former Prime Minister Yulia Tymoshenko, but says “I always decide on such things at short notice”. Despite all the talks of boycott, Ukraine insists they are ready to co-host the games along with Poland. Ukraine’s Deputy Prime Minister Borys Kolesnikov says that Europe’s football body, UEFA “has made no serious criticism about Ukraine” and adds that control of the four football stadiums in Ukraine will be transferred to UEFA on May 11. Their co-host, Poland supported Ukraine on the issue yesterday. Polish President Bronislaw Komorowski said that “In my opinion, calls for a boycott are completely inappropriate in terms of the current situation in Ukraine”.

With the Serbian presidential and parliamentary elections coming up on Sunday, the two main rival parties both seem to be pro-EU and share the goal of EU membership. Leader of the ruling Democratic Party, President Boris Tadic urged voters yesterday to support his pro-European policies by re-electing him. Presidential candidate Tomislav Nikolic and his Progressive party, who split from the nationalist Radical party after the 2008 elections also proclaim to be in favour of European integration, though some still doubt how serious they are about that. Economy is a major issue in the Serbian elections, and EU membership is seen as a road to stability despite a drop in public support of it during the current financial crisis. An invitation to EU membership has come closer with some important turning points the past year; the war crimes fugitive, Ratko Mladic has been handed over, and in February an agreement was made on some outstanding issues with Kosovo.

Li Keqiang, who is expected to be named Chinese premier next year, set up an investment fund of 17 million euros to pump more Chinese money into leading European firms during a visit to Belgium yesterday. “8.5 million euros will be destined for projects in Belgium, the remainder possibly invested elsewhere in Europe” said a government source, and the Belgian Foreign Minister Didier Reynders says that “we try to be the gateway to Europe for Chinese investors”. Today Mr. Li is to sign off on three joint statements on energy security, electricity market reform and “sustainable urbanisation”. The latter is part of an agreement at a February EU-China summit to bring the two sides together to build energy-efficient ‘green cities’. Also today, EU energy ministers will gather in Brussels to meet members of China’s National Energy Commission in order to discuss electricity markets.

Standard & Poor’s raised Greece’s credit rating to CCC from SD (selective default) yesterday after the country completed its distressed debt exchange.Though keeping in mind Greece’s deep recession and high debt burden, Standard & Poor’s said that the outlook on the country’s long-term rating is stable, and that the CCC rating reflects the reduction and the improved maturity of Greece’s sovereign debt. They do warn about the Greek parliamentary elections on Sunday which might render Greece’s path to fiscal adjustment more uncertain.

Despite the cautiously good news from Greece, the unemployment rate in the 17-nation eurozone reached a record of 10.9 in March, according the Eurostat data agency. Commentators suppose this will bring further pressure on the tight German-led austerity measures, especially since polls still predict a win for Socialist Francois Hollande in the French presidential election, also on Sunday. Head of the Re-Define think-tank, Sony Kapoor puts it this way: “The question is how long EU leaders will continue to pursue a deeply flawed strategy in the face of mounting evidence that this is leading us to social, economic and political disaster”.

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