Grayling Espresso 06/13

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Your monthly shot of EU news

What’s Brewing?

Since the economic crisis began way back in 2008, many EU Member States have caved in to pressure from their electorates and installed protectionist measures as a means to insulate them from outside pressures.

This goes against the spirit of the EU’s Internal Market, not to mention the EU’s four freedoms of people, goods, services and money.

With 26 million currently unemployed in the EU (the equivalent of the total population of Denmark, Finland, Norway, and Sweden combined), but with huge variations across the continent, who would not pull up the drawbridge and lock the gates to outsiders?

One Member State however stands out from the crowd in this respect and is positively inviting workers to integrate into their labour market. This country is Germany.

Breaking the protectionist mould

Tens of thousands of workers, the majority from the EU’s southern Member States which have been hardest hit by the crisis, are currently heading northwards to the EU’s already most populous country.

Awaiting them will not be just manual

jobs. Skilled positions including engineers, scientists, and IT specialists are also urgently required to fill a gaping hole in the German market.

“Brain drain”

After the “big bang” enlargement of 2004, many new Member States in Central & Eastern Europe experienced a “brain drain”. Will the same happen in Portugal, Greece, or Southern Italy?

Meanwhile, citizens still baulk at having their taxes channelled towards bailing out other Member States. So much for solidarity.

Yet with a common monetary zone and four freedoms mentioned above, surely it is only natural for a common labour market to not only exist, but to be encouraged.

What is missing however is a common EU fiscal policy which can tie all this together. Yet with taxation still ruled by unanimity in the Council, this looks far from being achieved.

Thus, it remains up to individual Member States to manage their own finances, balance the books, and where necessary fill the gaps in employment – yet whilst Germany is in a position to use its cash to lure the best and brightest to its shores, the countries which are left behind get ever deeper in the financial mire.

In this context, Germany’s latest initiative looks like less of a selfless good deed, and more like just another protectionist measure. Plus ça change…

Robert Francis Editor [email protected]

Croatia joins EU

On 1 July Croatia officially became the EU’s 28th Member State, thereby further expanding the EU’s single market and opening up opportunities for business, travel, education, and culture.

As a country of just 4 million people, Croatia will have seven votes in the Council, and 12 MEPs (5 EPP, 5 S&D, 1 NGL/GUE, and 1 ECR) who will be present until the May 2014 elections, when their number will reduce to 11 in accordance with the Treaty of Lisbon. Croatia’s Commissioner is Neven Mimica, who is responsible for consumer protection.

For more information see: www.croatia-in-the-eu.eu

Freedom to be protectionist

Black & WhiteStronger climate and energy targets for 2030?

Through the grinderEnforcing a Single Sky for Europe: A high-flying dream?

Behind the counterYuki Hirajo

July 2013

Targets, targets, targets - which ones will be set and how ambitious will they be?

This question captures the essence of the EU’s debate on the climate and energy framework for 2030, which was formally launched with the publication of the Commission’s Green Paper in March 2013.

The current EU framework for energy and climate policies up to 2020 consists of three headline targets: a 20% reduction of greenhouse gas emissions compared to 2005, a 20% share of renewable energy in final energy consumption, and 20%

primary energy savings compared to baseline developments.

The lack of a binding energy efficiency target is widely contested and is believed to be one of the reasons that the 20% energy savings target is unlikely to be met.

Consequently, whether energy efficiency will be pushed more under the 2030 umbrella is one of the key topics of discussion.

An increasingly important political debate

More than ever, energy and climate policies are being linked to economic growth and job creation, and all players involved have now explicitly recognised this potential.

At the European Energy Council in May, Member States explicitly called for EU action, underlining the link between climate/energy policies and the EU’s struggling economy.

Mounting pressure on the European Commission

However, the Commission has so far refrained from choosing an all-compassing 2030 framework, despite the political goodwill shown by Member States.

While consistently calling for binding greenhouse gas emission targets, the Commission remains vague when it comes to renewables and energy efficiency targets.

Industry and large sections of civil society have been particularly vocal about their views regarding the Commission’s approach.

The message is clear: emission

targets alone will not get the job done, and the EU needs to unlock the potential of energy efficiency for the environment and the economy.

The Commission is being told that given the long cycles associated with energy and climate investments, a clear long-term framework is critical to avoid lock-in effects in inefficient or polluting technologies.

A critical few months

The first of a long series of policy milestones will be the outcome of the public consultation launched by the European Commission, which closed on 7 July.

Whether the call for energy efficiency and renewable energy targets will ring loud enough to force the Commission’s hand however remains to be seen.

In any case, the 2030 framework will be one of the hot topics on the Brussels scene over the coming months, with a first spike in the Autumn with the publication of the Commission’s proposals.

Watch this space!

[email protected]


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Your monthly shot of EU newsespresso

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Stronger climate and energy targets for 2030?

July 2013

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And our blog - www.theeulobby.eu


Through the grinder


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espressoEnforcing a Single Sky for Europe: A high-flying dream?

US-EU Trade: an ambitious agreement?

The airspace above Europe’s single market remains very fragmented and inefficient, with 38 separate air navigation services compared to just one in the US.

The economic cost is estimated at ¤13.49 billion per year and is set to increase by around 50% by 2050.

The need for FABs

Much could be done however if Member States managed to implement the Single European Sky (SES I & II) packages, the most urgent being the creation of nine functional airspace blocks (FABs).

The Commission’s latest attempt to boost implementation came in June 2013 when Commissioner Kallas proposed the SES 2+ regulation to delegate more standard-setting and sanctioning power to the EU level.

The proposal introduces a strict separation between national supervisory authorities and air traffic control organisations in order to enhance independent oversight.

The Commission also proposes to break up air traffic controllers’ current “unnatural monopolies” by tendering out provision of ancillary services.

Unusual bedfellows

Germany and France have both rejected the proposal to split up national regulatory authorities, while fears of job losses and airspace sovereignty unite a coalition of Belgium, UK, Ireland, Austria, and the Czech Republic.

Air traffic controllers and unions are also opposing the reforms and calling for the status quo to be retained.

The most optimistic scenario has SES2+ winning a qualified majority of the Council and European Parliament approval by the end of 2014 at the earliest.

However, upon an initiative by France and Germany, the European Council may formally advise grounding the initiative at its next session in mid-October - for good?

[email protected]

Despite staunch opposition from France, on 17 June the EU and the United States officially launched negotiations towards a comprehensive transatlantic trade and investment partnership.

France’s opposition stemmed from its wish to exclude the audiovisual media sector from a potential future agreement, on the basis of the need to protect European culture from multi-national American giants.

Although it was decided that audiovisual media services would be temporarily exempted from negotiations, critics worry that allowing exemptions at this stage will only encourage Washington to refuse to negotiate in other important areas such as air and maritime transport, public procurement, and financial services, and ultimately water down a final agreement.

Lowest common denominator

EU NGOs cautioned that negotiations should not lead to a lowest common denominator outcome and expressed concern that there could be a watering down of the ‘precautionary’ and ‘polluter-pays’ principles.

Many of the issues which are likely to be most sensitive are those where European policy-makers value the precautionary principle most, including agriculture, GMOs, food safety, and phytosanitary standards.

The chair of the Parliament’s International Trade Committee Vital Moreira welcomed the launch of negotiations, but warned, "Parliament will only give its final consent to the deal if it is in the best interest of our businesses, workers and consumers".

Benefits

Despite these concerns, the potential benefits are indisputable; the US and Europe account for almost half of the world's total output and a third of its trade, and the transatlantic partnership is the largest in the world.

Negotiations will kick off on 8 July in Washington, and policy-makers hope to reach an agreement by the end of the Commission’s mandate in October 2014 - almost certainly an unrealistic ambition.

Will Europe be able to accept regulatory compromise, or will the power of the Parliament, backed by NGOs and consumer groups, block an ambitious deal in the name of European culture and ideals?

[email protected]

July 2013

Functional Airspace Blocks

Nationality - Japanese


Behind the counter!


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Robert Francis Editor Avenue des Arts 46, 1000 Brussels, Belgium

What is your role within Grayling Brussels?

My role here is to strengthen the relationship with our current Japanese clients, acting as a liaison officer between them and Grayling Belgium, as well as expanding our business with Japanese companies.

I also monitor EU developments every day and am working in energy, transport, food, and environment policies, as well as translating our newsletters and reports into Japanese when needed.

What have you found are the main differences between working in Brussels and working in Japan?

Generally speaking, the Japanese are said to work a lot, and to be honest I didn’t expect people in Brussels to work as long and hard, but they do!

What I have also noticed is that people in Brussels respect others’ private time and communicate with each other on an equal basis and very honestly, which I like. Perhaps this pleasant working atmosphere could feature in the discussions for an EU-Japan trade agreement, maybe under the section on non-tariff measures!

How do you think EU-Japan trade relations will develop in the coming months and years?

It is hard to say as the negotiations just started this April, and they have not yet discussed the details.

In my opinion, we have to conclude the agreement in order to strengthen our bilateral relationship and increase our global competitiveness against the emerging countries, such as China, India, and Brazil. If we can reach compromises on the automotive industry and non-tariff barriers to trade, the negotiations should go smoothly.

What do you think of Brussels?

I think Brussels is a great place to work because there is a lively atmosphere thanks to the European institutions.

The best European brains are concentrated here and high-level discussions are going on a daily basis, and I am never bored!

Because Brussels is the centre of Europe, I can meet open-minded and friendly people from not only all of Europe, but also the rest of the world.

Yuki Hirajo is Grayling Brussels’ new Japanese colleague. We caught up with her to find out how she was finding life in the EU capital.

Office - Brussels

[email protected]

Job Title - Senior Consultant

Name - Yuki Hirajo

July 2013

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Grayling Espresso 06/13