Daily Digest: New Franco-Germanic era begins today

After meeting with former president, Nicolas Sarkozy, the newly elected French President Francois Hollande is to fly to Berlin and meet with German Chancellor Angela Merkel later today, only a few hours after his inauguration ceremony. Hollande promised in his campaign to focus more on growth in Europe and to renegotiate the fiscal treaty. Merkel, however, still insists on fiscal control and says that the treaty, signed by 25 out of 27 EU member states is not up for renegotiation. The markets are watching closely as these two leaders meet, since their future relationship seems very important for the future of the European economy.

Greek President Karolos Papoulias proposed yesterday to gather the countries struggling political parties today and form a technocrat government, like the one in Italy, to ensure that Greece will not be cut off from international aid and that the country will remain in the eurozone. But it doesn’t look like the parties in the fragmented Greek parliament can agree on anything, despite the growing pressure to find a solution, and some of the parties refuse to accept technocrats in office. Leader of the Democratic Left party, Fotis Kouvelis puts it this way: “A government consisting of technocrats is proof of a defeat of the political system”.

The political limbo in Greece is moving the country very close to an exit from the eurozone. EU finance ministers warned Greece yesterday that if they do not form a government and stick to the austerity terms of their bailout deal with EU, they will risk being ejected from the eurozone. Though most member states of the eurozone, especially Germany, have insisted until now that a Greek exit was not an option, this rhetoric seems to have loosened up recently, also in Germany, and it sounds like a Greek exit may be tolerated. This puts even greater pressure on politically chaotic Greece if they want to keep the euro currency.

In a statement released yesterday, the EU announced new sanctions against Syria and warned of further sanctions if Bashar al-Assad’s regime does not abide by a ceasefire. By freezing assets of two entities that support the Assad government financially, the EU Council has implemented its fifteenth package of sanctions against the Syrian government.

The EU’s 27 foreign ministers met yesterday in a discussion on whether to boycott the Ukrainian football games when they co-host the European Championship with Poland in June. While many ministers, commissioners and European leaders are expected to boycott the event, the foreign ministers did not come to an agreement on the issue. EU foreign policy chief Catherine Ashton said after the meeting: “We are not at a stage to make a decision on attendance but will follow developments carefully”.

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