Recent developments

Lisbon treaty could offer Greece help-German MP

The European Union could refer to an article in the Lisbon Treaty to provide assistance to Greece, a German opposition lawmaker said on Monday.

Gerhard Schick, finance policy expert for the Greens party, told Reuters he had asked legal experts attached to the German Bundestag lower house of parliament for an opinion on whether Article 122 of the Lisbon Treaty would be valid for Greece.

The article says that EU members states that are "seriously threatened with severe difficulties caused by natural disasters or exceptional circumstances
beyond its control" can be granted financial assistance "under certain conditions".

Schick said that the Bundestag's legal consultants were of the view Article 122 might be applicable to Greece.

"I asked for the parliament's expert opinion on Article 122 and it seems clear that it could possibly be applied," Schick said. Until now the German government has referred only to Article 125 which appeared to rule out assistance, he added.

"My main demand is that both articles are taken into account," Schick said. "I think it's important that people are aware of both articles in the discussion on Greece."

There has been opposition to aid for Greece from members of Chancellor Angela Merkel's coalition with several senior politicians expressing scepticism.

Athens has struggled to convince investors it is tackling its debt crisis and markets are nervous about a default.

European Union leaders discussed the thorny issue last week and offered words of support but failed to outline concrete steps, further unsettling markets. Euro zone finance ministers are expected to discuss Greece again on Monday and Tuesday.

Merkel's coalition partners, the pro-business Free Democrats (FDP), are especially resistant to helping Greece. Schick's Greens and the FDP have long been arch rivals in Germany.

 

“It’s a nauseous situation,” said Sinan Akiman, deputy chief executive at Garanti Asset Management, Turkey’s third- largest fund manager with the equivalent of $4.1 billion in assets. Akiman said he’s betting on the lira’s depreciation and stock declines on concern the clash may trigger early elections or push the courts to seek the closure of Erdogan’s Justice & Development Party.

The Financial Times is complicit in a deception of its readers this morning. ‘What’s new?’ a cynical media-observer might ask? Here is an extract from the article I am referring to. Ask yourself as you read, why is Darling stating that it’s not up to Britain to bail out the Greek Euro? Surely that’s obvious. Alistair Darling said on Friday that Britain would not join any European effort to bail out Greece but pledged not to use differences in global financial regulations to promote the City of London. Answering questions about a possible European bail-out of Greece at the World Economic Forum in Davos, the British chancellor made it clear he saw the problem as one for the eurozone and not the wider European Union.
“The euro area has primary responsibility for anything that might be happening. We are not involved in that,” he said.
Britain’s decision to opt out of the single currency means it is not part of the eurogroup, which discusses eurozone affairs.
“It is in the interests of the eurogroup they provide whatever assistance [is required],” Mr Darling added. In the Lisbon Treaty, which Gordon Brown rushed to Brussels to sign, and which he crashed through both Houses of Parliament as the first act of his premiership, there was one small term which Darling is getting worried about, Article 122. A majority of the Council of Ministers of the EU can decide that a financial rescue package can be put through to bail out a eurozone member.
This is how I described the situation two weeks ago -
This is the most incredible news I have yet heard about the Lisbon Treaty. Article 122 – did you read this one Mr Brown? – states that where a member state is in severe difficulties, the Council Of Ministers may grant Union financial assistance, and no country can veto the decision if they do. Greece is about to crash out of the Euro, unable or unwilling to fix its deficit. A Union bail-out is being planned as the only way to stop the Euro from disintegrating. According to Open Europe, Britain will be required to contribute. Even though we are not in the eurozone we signed all the terms of the Lisbon Treaty. Open Europe today says that Britain’s share of the Greek bail-out will be £7 billion, or higher if other bankrupt eurozone countries like Spain are excused their share, maybe £8 or £9 billion.
Can you believe it? We in the UK are already borrowing to the tune of (minimum) £178 billion this year, of which £10 billion is going down the throats of EU bureaucracy, and now this.
Did anyone have any idea that dear Old Gordon was signing us up to bailing out the EU’s bankrupt states such as Spain, Portugal, Italy, Greece and Ireland when he dashed off to sign up to Lisbon first thing he was appointed, when he refused to be photographed signing the wretched thing?