Archive for February, 2019

U.S. President Trump

February 28, 2019

U.S. President Trump and his ambition to strengthen America by changing rules, producing deep divisions in his country. Authoritarian nationalist seeking to put into effect promises of his aggressive presidential campaign, surprised allies and enemies with radical measures, attacking immigrants and intimidating the media, taking distance from free world trade and globalization. His budget plan includes a tax reform, of both personal and corporate taxes, a massive Trillion-Dollar infrastructure program, elevating security and military spending by reducing spending in most other areas, projecting an economic growth of 3%, up from meager 1,6% in 2016. He leaves no doubt to favor companies investing in the United States and contracting Americans, saying that those producing abroad should have to pay a -protectionist- compensating border tax, insisting that U.S. allies used America for years owing lots of money, causing his returning to protectionism, contributing to the rise of global populism, caution and consternation in the international community. Although having a strong base of followers, his approving rate is one of the lowest in U.S. history, as he hopes to gain the support from conservatives motivating their nationalist vision. Saying ‘enough is enough’ the Trump administration ordered a massive missile attack on a Syrian air base in retaliation for a suspected chemical attack killing at least 87 civilians, stepping up the pressure on Russia to rein in Syrian President Al Assad warning of any further chemical attacks, saying the missile strike carries a message for others, sending a carrier-led strike group to the Korean peninsula, increasing international tensions, dropping U.S. military its most powerful nonnuclear bomb on an Islamic State complex in Afghanistan. North Korea said it was ready to sink a U.S. aircraft carrier to demonstrate its military might. The U.S. started moving parts of an anti-missile defense system/the Terminal High Altitude Area Defense (Thaad) system to a deployment site in South Korea, about 250 km south of the capital, Seoul, arriving a guided missile submarine from the U.S. Navy in South Korea on the same day that North Korea celebrated the 85th anniversary of the founding of the Korean People’s Army. Signaling a certain willingness to exhaust non-military alternatives despite repeated warnings that ‘all options are on the table’, the Trump administration said now it aimed to push North Korea into dismantling its nuclear and missile programs through tougher international sanctions and diplomatic pressure and still remained open to negotiations. A CNN/ORC poll showed nearing the 100-day mark that Donald Trump is the least popular U.S. President in history at this point in his term, as some observers compare his opening months with a chaotic discovery of power. Going by President Trump’s ‘100-day action plan to make America great again’, his progress has been slow. President Trump’s ‘very friendly’ talk with President Rodrigo Dudarte, who has lead a deadly crackdown on drugs in the Philippines, inviting him despite human rights criticism to visit the White House, stuns aides and critics alike, the same as his opening the door to meeting North Korea’s Kim Jong Un, saying he would be honored to meet the young leader under the right circumstances, even as Pyongyang suggested it would continue its nuclear weapons tests, as Asian nations are swinging toward China’s orbit, a consequence of President Trump’s ‘America First’ agenda. Without referring to President Trump, a Fed-speaker declared that trade protectionism is a ‘dead end’ that may score political points but will ultimately hurt the U.S. economy. Deepening sense of crisis as President Trump defends F.B.I. firing, media revealed that the President pressed James Comey, the law enforcement official leading a wide-ranging criminal investigation into whether Mr. Trump’s advisers colluded with the Russian government to steer the outcome of the 2016 presidential election, for ‘loyalty’ at a private dinner in January 2017, promising the F.B.I. director only ‘honesty’, asking President Trump in February 2017 F.B.I. director Comey to close the Flynn/Russia investigation, facing the deepest crisis of presidency as Comey memo surfaces, playing online bettors early end to Trump presidency, naming Justice Department Robert S. Mueller III., former F.B.I. director, special counsel for the Russia investigation. North Korea launched a new developed mid-to-long range ballistic missile, reaching an altitude of more than 2.000 kilometers and landing in the Sea of Japan close to Russia, saying North Korea it was aimed at verifying the capacity to carry a large scale heavy nuclear warhead, asking the U.S. also Russia, after China, to help convince Pyongyang to stop its reckless nuclear weapons program or face serious consequences, sharing the code used in the latest cyberattacks many similarities with past hacks blamed also on North Korea. President Trump shared intelligence about ISIS provided by Israel with Russian officials, probably endangering spy placed inside ISIS by Israel, saying Trump he has an absolute right to share ‘facts’ with Russia, not informing if he revealed classified secrets, offering Russian President Putin transcript to prove that Trump did not pass secrets to Russia. With Trump crisis deepening Wall Street tumbled as reform hopes fade and the Dollar declined to a six-months low, threatening new Russia probe leaks to derail President Trump’s first foreign trip to Saudi Arabia and Europe, reporting media he told Russian officials in the Oval Office that Comey’s firing relieved ‘great pressure’ calling him a ‘nut-job’. President Trump, proving his art as deal maker, celebrated in Saudi Arabia mega-deals worth approximately $380 Billion, including $110 Billion arms agreement and $50 Billion worth deal with Saudi Aramco, inaugurating new era of U.S.-Arab partnership, urging Muslim countries at the Arab-Islamic-American summit to take a lead in fighting terror. European leaders were confronted in Brussels with an authoritarian President Trump, rebuking NATO leaders for not paying defense bill and producing deep differences in discussions over trade with the EU, receiving renewed pleas not to abandon the Paris climate change agreement. Fellow Republican and former U.S. House speaker Boehner said that Trump’s time in office has been a ‘complete disaster’, aside from foreign affairs, praising his aggressive steps to challenge the Islamic State militant group and other moves in international affairs, explaining ‘he’s still learning how to be President’, ‘meaning President Trump the apprentice’, what may explain his cautious attitudes during the G7 summit in Sicily, still developing views on different very important issues, for example on climate change, where he is expected to ultimately do what he believes was best for the United States. German leader Merkel, remaining committed to U.S.-German relations, said that very unsatisfactory results of the G7 summit in Sicily shook her confidence in the United States, reducing her confidence in the Trump administration, moving President Trump and Chancellor Merkel further apart, which could mean a shift in the wider world order, emerging China as Europe’s unlikely global partner on areas from free trade to security. In a statement backed by all 28 EU states the EU and China will commit to full implementation of the Paris Climate Agreement that U.S. President Trump appears to be set to pull out of. President Trump announced the United States will pull out of the landmark Paris climate change pact, saying it was too expensive for the U.S., meaning the decision a profit for U.S. polluters, placing America alongside with Syria and Nicaragua, the other two non-participating countries, fulfilling a major pledge of his election campaign. However the climate won’t be able to survive the long-run absence of U.S. leadership, considering that the United States are second worldwide after China in greenhouse gas emissions; if an actual U.S. withdrawal ends up as a four year absence on a long-run downward emissions trajectory than the climate can survive it. Democratic state governors from California, New York and Washington intend to form an alliance committed to countering climate change, defying President Trump’s determination, announcing disappointed chiefs of Tesla and Space X, Elon Musk and of Disney, Robert Iger, they resign from the President’s advisory council, regretting other important business leaders, so from Apple, Facebook, General Electric, Goldman Sachs, Google, and Microsoft, the decision to exit the Paris agreement, expressing they will remain committed to fight climate change. President Trump accused former FBI chief Comey of lying under oath in his testimony to Senators, where he confirmed Russian interference in the 2016 presidential election, saying ‘they did it with purpose’. Notably backing the aggressive position of Saudi Arabia against Iran, and escalating the diplomatic crisis in the Middle East, President Trump accused Qatar of being a high-level sponsor of terrorism, recommending German Chancellor Merkel that all Gulf states and also Iran and Turkey, nations maintaining relations with Qatar, should work together to find a solution to the regional dispute. President Trump is rolling back the dètente with Cuba begun by Obama, asking Cuban government to release political prisoners. Described by President Trump ‘as the single greatest witch hunt in American political history’, former F.B.I. director Robert S. Mueller III appointed as special counsel is overseeing the Trump-Russia investigation. The U.S. Senate voted to enact new sanctions in response to Russia’s interference in the 2016 U.S. election, after reports that the Trump administration is considering easing sanctions on Moscow; EU-allies formally renewed economic sanctions against Russia on Ukraine until January 31, 2018. The Trump administration seems to be ready to use forth in North Korea if needed to stop its nuclear missile program, seeing it as a growing threat, although saying it preferred a global diplomatic action against Pyongyang for defying world powers. The G20 meeting in Hamburg ended with a forged trade compromise as U.S. tariff threat lingers, finding the Trump administration itself isolated, standing on issues like immigration, trade and climate change alone, expressing world leaders their total disagreement with President Trump on climate change. On the sideline of the G20 gathering in Hamburg President Trump and Russian President Putin met face-to-face, who denied again any meddling in the U.S. 2106 election, establishing both sides a discussion how they could work together, including combating cyberattacks and de-escalating the war in Syria, apparently without producing any news. President Trump threatened North Korea with ‘fire and fury’ after Pyongyang announced it examines plans for a missile strike on the U.S. Pacific territory of Guam, a major U.S. military base and home of U.S. bombers. President Trump praised Kim Jong Un’s decision not to fire missiles toward Guam, easing tensions between the two countries. After more CEO’s quit Trump council over his response to violence in Charlottesville, the U.S. President ended his two advisory panels, the Manufacturing Council and the Strategic and Policy Forum. Outraged by his defense of white nationalists, the President has been abandoned by executives, contradicted by military leaders and shunned by Republicans. Stephen Bannon, President Trump’s chief strategist, left the White House after clashing for months with other senior advisers and members of Trump’s family. President Trump decided to deepen American involvement in Afghanistan, formerly opposed by him. Shock Poll: a Pew Research Poll shows that most countries prefer Russian President Putin over the U.S. President Trump. After North Korea’s new sixth and most powerful nuclear test, the U.S. urges a fuel cutoff for the country, saying it’s ‘begging for war’, intending to resolve the standoff using tougher sanctions rather than military means. The U.N. Security Council strengthened North Korea sanctions, but North Korea launches still another missile over Japan, escalating again crisis. President Trump signaled he will choose approach on Iran that preserves nuclear deal. Senator Bob Corker, the Republican chairman of the Senate Foreign Relation Committee, said Trump was treating his office like ‘a reality show’, in an extraordinary rebuke of a president of his own party, adding he concerns me and he would have to concern anyone who cares about our nation. According to polls, President Trump now is the least popular first-year President in U.S. history and only 18% of voters are actually prepared to vote him again as President in 2020. 12 months of President Trump since election are bringing an economic boom, deepening divisions and probe politics. Compiling a solid record of accomplishments, much of it is unilateral, dependent on extensive executive actions, rolling back President Obama’s regulations, impressive judicial appointments and some progress in the fight against ISIS overseas. The $1,5 Trillion tax bill is his most significant legislative achievement, and a provision of the tax overhaul is expected to release a tide of U.S. corporate cash from abroad, estimated to reach eventually up to $400 Billion, a development likely to jolt the Dollar and reverberate throughout financial markets early 2018. 2018 could bring a bout of protectionism and his toxic persona, suffering still under the not yet concluded investigation of a Russian election interference in his favor, could drive a Democratic wave in the 2018 midterms.Michael Wolff promoted his new book ‘Fire and Fury’-‘Inside the Trump White House’ by saying that Trump is unfit for presidency, adding that his revelations will bring down Trump, defending Trump his mental capacity, saying he is ‘a very stable genius. President Trump accepted an invitation to meet Kim Jong-un of North Korea offering to start talks on giving up its nuclear weapons, a high-level diplomatic encounter so risky and seemingly far-fetched that some of Trump’s aides believe it will never happen. President Trump ordered the expulsion of 60 Russian officials and closed a consulate, joining a coordinated campaign by two dozen countries to retaliate for poisening of a former Russian spy in Britain, saying Russia it will respond in kind to West’s expulsions. James Comey, the President’s fired FBI director, said President Trump is a serial liar, treats women like ‘meat’ and is a ‘stain’ on all who work for him. President Trump called on Attorney General Jeff Sessions to end Robert S. Mueller III’s, the special counsel’s inquiry into Russia’s election interference and possible ties to his campaign, saying his lawyer it was an opinion, not an order. President Trump forced the resignation of Attorney General Jeff Sessions, tapping Matthew Whitaker as acting attorney general, seeking U.S. Democrats hearings of the ouster, calling it a move to undermine federal probe into Russian meddling in the 2016 U.S. election. President Trump is becoming after midterm elections even more radical, suspending the White House press pass of CNN reporter after confrontation with the President and warning Democrats against using their new majority in the House of Representatives to investigate him and his administration. Fed Chairman Powell has a high approval rate among corporate chief financial officers, the same can’t be said of President Trump or his trade advisors, according to the latest CNBC Global CFO Council. Accused of wrongdoing the Trump foundation will be resolved. A NBC/Wall Street Journal poll contains that only 43% of Americans approve of the job President Trump is doing, while 54% disapprove; only 28% of Americans think the economy will get better in the next 12 months, while 33% expect it will get worse and 37% believe it will stay about the same, the survey found. Ex-Trump adviser and longtime ally Roger Stone was arrested facing obstruction charge, saying he ‘never will’ turn in Trump; he was indicted by special counsel Mueller over alleged coordination with Trump officials about stolen emails from WikeLeaks with information that would be damaging to the Clinton Campaign. President Trump declared a National Emergency so he could build the border wall, provoking a constitutional clash, urging key GOP Senator Lamar Alexander the President to withdraw his national emergency declaration or face a Republican revolt.

British PM May, after initiating the ‘Brexit’ process, and Japanese PM Abe, considering the growing threat of North Korea and Chinese military expansion in Asia, depend increasingly on their traditional ally, the United States, advancing President Trump to accept his  international commitments. PM May called for early general elections on June 8, 2017, claiming they are a chance to heal divisions over ‘Brexit’, suggesting new polls she will win comfortably Labour, which is on 28%, trailing her Conservative Party , which is at 47%. Conservatives lead over Labour Party has fallen, showing new polls before election that Conservative Party was on 43%, down 1% from a weak ago, while Labour Party was up 3% to 37%. Britain’s official terror level has been raised to ‘critical’ by PM Theresa May, which means another attack is expected ‘imminently’, after bomber slaughted at least 22 people, including children, at packed pop concert in Manchester, suspending May her election campaign, warning an EU report that more than 1.500 jihadists have returned to Europe with orders ‘to carry out attacks’. After a third terrorist attack in less than three months in Britain its PM May said ‘enough is enough’, vowing to intensify counter terror efforts, clarifying that election on June 8, 2017, would go ahead. Ruling Conservatives lost their parliamentary majority, forming PM May a minority government with the small Northern Ireland’s Democratic Unionist party/DUP, weakening her position just days before negotiations of U.K.’s exit from the U.E. were due to start, agreeing both sides the first day of talks that ‘Brexit’ must be orderly. An explosion on the London Underground is being treated as a terrorist attack, leaving more than 30 people injured. U.K.’s growth will lag behind most of E.U.; accelerating Euro-zone set to outstrip Britain at time of ‘Brexit’, as uncertainty is continuing to weigh on investment in the U.K., while inflation is hitting customer purchasing power; the Euro-zone will mark its best year in a decade and maintain a solid growth well into 2018. The U.K. is expelling 23 Russian diplomats over the poisening of a former spy on British soil in a sharp escalation with Moscow, joining the Trump administration a collective statement with Britain, France and Germany denouncing Russia for its role in a nerve gas attack on a former Russian spy and his daughter. Most of U.K. P.M. May’s Conservative Party members oppose her ‘Brexit’ deal, a recent survey showed.

German Chancellor Merkel seeking re-election in 2017, challenged by opposition candidate Martin Schulz, is considered as a strong conservative European leader, criticized for her immigration policy allowing refugees to enter and stay in Germany, pushing now public spending on refugees the economic growth in Germany, most likely will be able to rule for a fourth term of four years as chancellor, as people seek calm and stability. In her first meeting with President Trump deep differences about immigration and world trade got evident. Angela Merkel vowed fight hard to win a fourth term in the German Federal election on September 24, 2017 against her center-left challenger Martin Schulz, after an unexpectedly clear state election victory in the German State of Saarland. Angela Merkel won a fourth term as chancellor, placing her in the front of Germany’s post war leaders, even as her victory was overshadowed by the entry of the far-right party Alternative for Germany/AFD, getting some 13% of the vote, into Parliament for the first time in more than 60 years, while the center-left Social Democrats, Merkel’s coalition partner for the last 4 years, announced that the party would go into opposition, forming Mrs. Merkel probably a coalition with the pro-business minded party of the Free Democrats/FDP, who won some 10,4% of the vote, and eventually with the left-leaning pro-environment party of the Greens, who won about 9%, before ending 2017. German veteran finance minister conservative Wolfgang Schaeuble, deeply respected in Germany, agreed to become president of the parliament, clearing the way for another party to take his job, possibly the Free Democrats/FDP as likely new coalition partners, seen as a decisive step to help Mrs. Merkel to form a new government. After failing coalition talks with Free Democrats and the Greens momentum is growing for another grand coalition after SPD leader Schulz agreed to hold talks with Merkel about reviving their outgoing coalition government. Chancellor Merkel’s Christian Democratic Union/CDU has thrown its support behind pursuing a new alliance with Social Democrats/SPD, renewing the ‘grand coalition’, stressing Merkel the importance for a stable German government. Slowly Germany begins to ponder life after Merkel, as members of Merkel’s conservatives are starting to look ahead to potential alternatives to lead their party and Germany; the succession debate has been supercharged by the inclusion of a clause in the preliminary coalition deal with SPD that envisages a review of the next government’s progress after two years to assess whether any changes to its mission are needed, seen as a good time for Merkel to resign. Angela Merkel moved closer to a fourth term as German Chancellor, after naming Annegret Kramp-Karrenbauer as new CDU general secretary, tipped as her successor, and appointing ministers for a renewed coalition with the Social Democrats/SPD, still pending a postal vote of SPD’s 464.000 members in favor or against the deal, expected the results to be announced on Sunday, March 4, 2018. Angela Merkel was sworn in for a fourth term as German Chancellor, approving the Parliament earlier her re-election by 364 votes to 315, after securing a new coalition deal with the Social Democrats/SPD, who succeeded to appoint two pro-European politicians to key posts, the Finance and Foreign Minister. Chancellor Merkel initiated her term with a trip to Paris, visiting French President Macron who is seeking her support for plans to reform the EU. Chancellor Merkel, in a major reversal on immigration, agreed to tighten asylum policies to prevent her government’s collapse, weakening her position still more. Angela Merkel will step down as German Chancellor when her mandate ends in 2021, following recent election setbacks in the state of Hesse and after Merkel’s Bavarian sister party, the CSU, suffered huge losses in a state parliament vote. She also said she would not seek re-election as leader of the central-right CDU party in December 2018, post she holds since 2000, explaining the time has come to open a new chapter. Chancellor Angela Merkel’s preferred candidate Annegret Kramp-Karrenbauer has been elected as new German CDU party leader, a decision that moves her into pole position to succeed Europe’s most influential leader as Chancellor; Kramp-Karrenbauer dubbed by the opposition as the continuity candidate is known as centrist seeking the party unity.

President Putin, the powerful and intriguing Russian leader, an experienced ex-spy chief, used to take advantage of international tensions and conflicts to reinforce and extend Russian presence and power. Apparently helped President Trump to get elected through intensive covered operations and hacking, attacking Trump’s adversary Hillary Clinton. The U.S. taking a sharper tone on Russia’s role in Syria, accusing the Kremlin of cover-up the Syrian’s government culpability in chemical weapons attack, ending Russia hopes of swift detente under President Trump, making state media, which hailed his election win, a U-turn, saying Trump was scarier than North Korea’s Kim Jong-Un. Russian President Trump now is saying, maybe private Russian hackers meddled in U.S. election, remarking ‘anything is possible in this virtual world’, denying again any state role. After President Trump’s visit to Saudi Arabia, now the escalation of a diplomatic crisis in the Middle East, cutting Saudi Arabia and the UAE trade and diplomatic ties with Qatar, accused to support terrorism, expecting Washington Qatar to pledge loyalty to a united GCC, of which it is a member, confronting under Saudi leadership Iran, considered as the worst enemy of the United States. Qatar, where the U.S. military has its largest Middle East airbase, Al-Udeid, rejecting the accusations to cooperate with proponents of terror, wanting just normal relations with its neighbors, is seeking help from Turkey and Iran to secure food and water supply, debating Turkey a law for military support of Qatar. President Putin joking, offering political asylum to former F.B.I. chief Comey, who denounced the Russian interference ‘with purpose’ in the U.S. 2016 election favoring Trump. After the U.S. shot down a Syrian military jet near Racca for bombing near U.S. allied forces on the ground, Russia warned the U.S. that it viewed any planes flying in its areas of operations as potential targets and will track them with missile systems and military aircraft, but stopped short of saying it will shoot them down, while the White House said coalition forces fighting Islamic State militants in Syria retained the right of self-defense. U.S. President Trump signed a bill with new sanctions against Russia, escalating tensions, responding Russian President Putin with an order that the U.S. must cut its diplomatic staff in Russia by 755. Russia’s Vladimir Putin has said he will seek another term as president in the 2018 election; he has been in power since 2000 and if he wins the March 2018 election he will be eligible to serve until 2024. President Putin was re-elected obtaining 75% of the vote, beginning a fourth term and expected to stay in power until 2024. Russia announced to expel 150 diplomats, including 60 Americans, closing Washington’s consulate in Saint Petersburg, in retaliation for Western nation’s response to the poisening of a former spy. President Putin invited President Trump to Moscow, saying ‘be my guest’, after the Helsinki meeting and delaying President Trump for the moment to welcome President Putin in Washington.

Chinese President Xi Jinping, the calm, mostly smiling power seeker, is always ready to confront other world leaders, intending to change global power balance further in favor of China; taking advantage of President Trump’s protectionism and regressive climate politics may be in a position to challenge the U.S. for global leadership, expanding China’s economic and military influence not only in Asia, but also in Europe, Africa, the Arab States of the Persian Gulf and Latin America. To avert a trade war with the United States, Peking is offering concessions, promising more liberalizations to increase accessibility for U.S. companies in China. U.S. officials praised China for stepping up efforts to rein in North Korea, Beijing’s neighbor and ally, announcing North Korea it will continue regularly test missiles and military action against it by the U.S. would prompt ‘all out war’, warning China of ‘storm clouds gathering’ in U.S.-North Korea standoff, urging an end to ‘mutual provocations and threats’, cautioning that tensions on the Korean peninsula could run out of control. China said it warned North Korea it would impose unilateral sanctions should Pyongyang carry out another nuclear test, possibly China’s toughest threat yet against its defiant neighbor. Elected new South Korean leader, liberal politician Moon Jae-in, may bring a more conciliatory approach toward North Korea. After launching North Korea an ICBM that can carry a large and heavy nuclear warhead, President Trump warned China he is willing to pressure Pyongyang on His Own.

After an attack on Champs-Èlysèes injecting more uncertainty into French Presidential election, France voted on April 23, 2017, in the first round of bitterly fought election that could define the future of the E.U.. The outcome, a choice between extremes, will show whether the populist tide that saw Britain vote to leave the E.U. and Donald Trump elected President of the U.S. is still rising, or starting to ebb. The pro-EU Emmanuel Macron, the centrist front-runner and  far-right leader Marine Le Pen are set to face each other in a May 7, 2017-runoff for the French Presidency after coming first and second in the first round, early projections have indicated, seeing opinion polls Macron winning the final clash against Le Pen. The European friendly Macron said the EU must reform or face the prospect of a ‘FREXIT’, making the comments as he and his far-right rival Le Pen entered last week of campaigning. Macron has been elected new French President, succeeding Hollande, keeping France at the center of the EU and reducing uncertainties of the Euro-zone, pledging in his inauguration to restore the country’s lost confidence and to relaunch the flagging European Union, agreeing President Macron with German Chancellor Merkel to draw up a road map to deepen EU integration, despite scepticism in Berlin over his proposed reforms. Chancellor Merkel said she was open to creating Euro-zone budget, inclusively to study the possibility of an Euro-zone Finance Minister as proposed by French President Macron. President Macron won a solid parliamentary majority enabling him to push through necessary reforms. German Chancellor Merkel praised the ideas of French President Macron for reform of the E.U. and said they could form the basis for intensive Franco-German cooperation. Emmanuel Macron says France’s economy needs re-shaping to lure investment and rein in spending, as he strives to persuade Berlin that Paris can be a credible partner with whom to drive European reform. As he revolutionized the French labor market, he is battling with unions calling for strikes, putting pressure on him struggling to shake off criticism that he is ‘president of the rich’. France and Germany want to reach a joint position on Euro-zone reform, including tax convergence, capital markets and the banking union, between March and June 2018. EU’s 27 Finance Ministers, with out Britain, reached a Euro-zone reform deal to fight against a financial crisis, expanding the responsabilities  of the European Stability Mechanism/ESM, but without setting up a European -style IMF. France in problem: the ‘yellow vest’ campaign started as a protest against green taxes on petrol and diesel in November 2018, leading President Macron to scrap them. But despite the u-turn violence including widespread rioting has continued , costing the French economy millions. Eight people are now dead as France’s violent ‘yellow vest’ protests entered their fifth weekend facing tear gas and pepper spray. A movement created on social media with no recognized leadership, has forced President Macron into concessions that were unthinkable a few weeks ago. Protesters say it’s not a confrontation about fuel taxes, or any one issue, it’s first and foremost a way for people to say ‘we exist’, to the elites, to the political class, to those who have forgotten about them for the past 20 years, showing to the rest of Europe that people have some power. Three-quarters of French people are unhappy with the way President Macron and his government  are running the country, with the majority keen to see more measures to boost household incomes, a poll showed recently. As the U.K. moves to leave the E.U., France and Germany signed a new treaty aimed at breathing new life into their place at the center of the European Union, highlighting peace and security, backing the emergence of the European Army, saying French President Macron the challenge was for Europe to become ‘a shield’ against the tumults of the world.

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EU member States – Sanctions against Russia again extended, new U.S. sanctions against Russia, beginning ‘BREXIT’ talks after Britain’s vote and formal notification to leave the E.U.

February 28, 2019

Joint U.S. and EU action, stepping up punitive measures targeting key sectors like energy, arms and financing sanctioning Russia’s continued illegal actions in Ukraine, undermining Ukranian territorial integrity and sovereignty, will hurt European economies slowing recovery, hitting Russian import ban European food producers, harming above all the German economy with close ties to Russia and the already stagnating Euro-zone economy. EU agreed to extend Russia economic sanctions until January 31, 2016, leaving time to enable EU to judge the compliance and full implementation of the Minsk peace agreement, planning Russia to extend the ban on Western food imports for six months starting from early August 2015, deciding the European Union in December 2015 to extend sanctions on Russia for another six months. A further six month extension of the bloc’s economic and financial sanctions against Moscow to punish Russia for the annexation of Crimea and support of separatists in eastern Ukraine has been agreed on by the EU, extending sanctions until the beginning of 2017. EU leaders signaled a further shift form austerity of the €uro-crisis giving member States extra time to consolidate their budgets as long as they pressed ahead with economic reforms, insisting France and Italy on a further easing of EU budget rules (3% ceiling) to stimulate growth and cut unemployment, pledging Germany for budget discipline, saying countries must move faster on reforms. Euro-sceptic and populist parties scored dramatic gains in voting 2014 for the European Parliament, however continuing pro-European centre-right and centre-left parties to control more than half of the 751 seats, forced to collaborate to get key legislation through the Parliament and into law, as they will face unprecedented challenge of noisy anti-establishment members determined to stop business as usual, saying German Chancellor Merkel the EU must create jobs to counter populist wave, demanding French President Hollande EU should concentrate on what matters, on growth and employment, adding British PM Cameron that Brussels has got too big, too bossy, too interfering, seeking with Sweden and the Netherlands a repatriation of powers from Brussels. Analysts warn of increasing political risks in Europe in 2015, as protest- and populist parties are rising. ECB said European policymakers should not give up efforts to make their economies more efficient and stick to budget rules, despite a strong protest note in European elections, moving on with structural reforms to finish what was started in 1999 and make the €uro-zone work. The €uro-zone’s overall Government deficit fell to the EU limit of 3% in 2013 from 6,2% in 2010, striking the €uro-zone’s fiscal stance the right balance between cutting debt and helping growth, however warning the IMF that the unemployment rate of around 12% was still too high. Inflation moving ever closer toward zero, a stagnating economy, a double-digit unemployment rate and new signs of reform fatigue among Euro-zone Governments are posing a serious challenge for the ECB, that it says it cannot solve alone, expressing G20 concern about Europe’s extended stagnation asking for more Government spending to stimulate growth, insisting Germany in structural reforms, strict budget controls and balanced budget, rejecting stimulus, expressing ECB and IMF the need to see countries using Government money prudently to avoid the Euro-zone slipping into its third recession since 2008, increasing pressure on Governments that have fiscal space like Germany, which posted its biggest budget surplus since reunification in the first half of 2014, asking Paris for a ‘NEW DEAL’ in Europe, expecting movements from Berlin to avert a policy clash. German Chancellor Merkel insisted that all member States must fully respect the reinforced rules of the Stability and Growth Pact, reminding the Euro-zone debt crisis has not yet been overcome and its causes have not been eliminated. ECB’s Draghi warned that no amount of fiscal or monetary accomodation can compensate for necessary structural reforms in the Euro-area, delaying France and Italy labor market reforms and to open up to more competition, failing the two countries to cut their budget deficits and debt in line with EU rules, opting EU Commission not to sanction them for missing public finance targets, giving both until spring 2015 to bring their debts and deficits in line. British PM Cameron strongly opposed nomination of Jean-Claude Juncker, the candidate of the European People’s Party, which won the European Parliament elections, as the next President of the European Commission, describing him as face of the past, while Junckers, supported by German Chancellor Merkel, says the crisis is not yet over and EU budget policy must remain as it is, posing politics rather than economics the biggest risk to the long-term endurance of the €uro, saying 48% of British voters they would currently vote to leave the EU in a referendum, while 37% would vote to stay, naming EU leaders Juncker as new EU Commission President, confirming the European Parliament his nomination by a comfortable majority, announcing Juncker Euro 315 Billion investment program to bolster European economic recovery, setting up EU a 21 Billion Euro European Fund for Strategic Investment, with the aim of drawing in 15 times that amount in private- and public – sector money to boost desperately needed jobs and growth, confirming EU Finance Ministers details of the 315 Billion Euro four-year investment plan, including an eight-member committee that will choose the projects. China will pledge a multi-Billion Dollar investment in the new infrastructure fund at a summit on June 29, 2015, in Brussels, considering the fund is going to create opportunities for China to invest in the EU, in particular in infrastructure and innovation sectors. France, Germany, Italy and Poland have each announced they plan to contribute 8 Billion Euros, while Spain and Luxembourg are pledging smaller amounts. The bloc is relying mainly on private investors and developments banks to fund projects from an initial list of almost 2000 submitted by the 28 member States, from airports to flood defenses, that are together worth 1,3 Trillion Euros. In addition the EU Commission is exploring whether the EU could become collectively a member of the $100 Billion China-led Asian Infrastructure Investment Bank/AIIB, Beijing, expecting China that European companies and Governments would take a greater interest in President Xi Jinping’s ‘One Belt, One Road’ initiative, aiming to create a modern Silk Road Economic Belt with railways, highways, oil and gas pipelines, power grids, Internet networks, maritime and other infrastructure links across Central, West and South Asia to as far as Greece. Greece, taking over the EU Presidency for the first half of 2014, criticising imposition of austerity, spending cuts and fiscal policy by Berlin and Brussels, is expecting still some more debt relief, like a further reduction of interest rates on existing loans, a new extension of the maturities and amortization schedule and some relief on financing EU structural funds, planning the €uro-zone to assure IMF it will keep funding Greece, enabling the IMF to disburse its next share of international aid to Athens, despite Greek delay in implementing 153 savings measures. Greece reached a primary budget surplus in 2014, confirming it doesn’t want a third bailout, raising €3 Billion with a coupon of 4,75%, after bringing a first sale of new Greek Government bonds more than €10 Billion of bids, backing Euro-zone Finance Ministers a precautionary ESM credit line for Greece after the country exits its bailout at the end of 2014. Greek Parliament approved budget 2015, preparing for the end of ‘an era of forced bailouts’, granting Euro-zone Finance Ministers Greece a two-month extension of the current bailout program, calling the country for early Presidential elections December 17, 2014, mounting political uncertainty, including fears Greece may exit Euro-zone, seeing European leaders no risk of contagion from Greek vote. PM Samaras failed to gather enough support for his candidate, Stavros Dimas, in a first, second and third Parliament vote, calling for national general elections to be held on January 25, 2015, suspending the IMF new disbursements of aid money until a new Government takes office, saying a Merkel ally that Euro-zone politicians are not obliged to rescue Greece as the country is no longer of systemic importance for the bloc, as Germany seems to believe an exit of Greece is manageable and the danger of contagion is limited, because Portugal and Ireland are considered rehabilitated, revising Fitch outlook on Greece to negative from stable. Greek leftist Tsipras was sworn in as new PM, after forming Government with a small Party of nationalist independent Greeks, winning Tsipras’ anti-austerity, left-wing Syriza 36,3% of the votes in general election and 149 seats in the 300-seat Parliament, just two short of an absolute majority, and Kammenos’ right-wing Party the Independent Greeks 4,8% of the votes and 13 seats, while ruling conservative coalition won just 27,8% and the extreme right Golden Dawn in third place 6,28% of the votes. Syriza’s Tsipras has pledged to renegotiate Greece’s debt arrangements with EU, ECB and IMF/amounting to €257 Billion, naming radical Yanis Varoufakis as Finance Minister, while Independent Greek leader Kammenos will take over the Defense Ministry, aiming France’s Socialist Government to facilitate Greece-Euro-zone talks. Moving to change Europe, leftist Greek Government is seeking anti-austerity allies in Spain, Italy and France, saying Greek Finance Minister he is looking for a new deal with the EU, ECB and the IMF, putting in doubt if Greece will continue to cooperate with the TROIKA and comply with its austerity program, but not calling any more for a write-off of Greece’s foreign debt, but proposing now a ‘menu of debt swaps’, making the ECB already €65 Billion available in emergency liquidity to Greek banks, as long as Athens will give compliance with the terms of the EU/ECB/IMF bailout program. The U.S. expressed support for a positive outcome of Greece-EU talks intending reaching a deal on a new aid program that would put an end to austerity and pursue necessary reforms. Greece’s negotiations with the EU failed to reach an agreement and Athens has been given time until February 20, 2015, to renew bailout-program, of which 70% would be acceptable for Greece and 30% could be replaced, announcing Greece it will submit a request to extend ‘loan agreement’ for up to six months, saying Germany no such deal was on offer, demanding that Athens must comply with the terms of its existing international bailout-program, sealing Euro-zone Finance Ministers finally a four-month extension after Athens sent a detailed list of reforms it plans to implement by the end of June 2015, returning Greece after seven years to growth, expanding its GDP by 0,8% in 2014, after shrinking by 0,4% in the final quarter of 2014, seeing the EU Commission a contraction of 1,4% in 2015. Athens is determined to loosen austerity to revive its economy. Greek Parliament elected pro-European former Minister Prokopis Pavlopoulos as new President. Fitch lowered Greece’s rating by two notches to the high-risk level of CCC down from B, saying it nevertheless expects the Government would survive its cash squeeze, cutting the rating agency Athen’s growth forecast 2015 to 0,5% from 1,5%. Berkshire’s Buffett said ‘Grexit’ ‘may not be bad’ for the Euro-zone and could be ‘constructive’ for the region. Greece confirmed loan repayment €450 Million to the IMF, while still struggling to pay other debts, and has been requested to improve package of proposed reforms in time for the meeting of €uro-zone Finance Ministers on April 24, 2015, to decide whether to release more funds to keep the country afloat. Moody’s further downgraded Greek Government bonds to junk territory, cutting rating to Caa2 from Caa1, a level that is equivalent to an extremely speculative junk bond, lowering also Greek local and foreign currency bond ceilings to B3 from Ba3, citing the increased probability that Greece may exit the €uro-zone in the event of a sovereign default, saying Greece it will default in June 2015 without aid from lenders, suggesting the $300 Million-IMF payment on June 5, 2015, is under question, allowing creditors Athens to bundle four payments due in June 2015 into a single €1,6 Billion lumpsum, which is now due on June 30, 2015. EU President Juncker declined to speak to Greek PM Tsipras after the leftist leader rejected as ‘absurd’ international creditors’ terms for a cash-for-reform deal to keep Athens from default, saying ultimate proposals are not realistic, warning not to impose humilating conditions on his country. The IMF quits Greek negotiations because of major differences, telling EU PM Tsipras to stop gambling, leaving for home also the entire Greek delegation after continuing disagreements, downgrading Standard & Poor’s Greek long term credit rating from CCC+ further into junk territory to CCC with a negative outlook, cutting also further the credit rating of Greece’s biggest four banks, reflecting the probability that Greek banks will default if Athens doesn’t reach an agreement with its creditors, discussing Senior EU officials formally for the first time a possible Greek default. Greece and creditors failed in a ‘last attempt’ to reach a deal, coming a Greek default and a possible ‘Grexit’ closer, shifting the focus now to a June 22, 2015, EU emergency summit after Greek talks collapsed, to discuss the situation of Greece at the highest political, increasing ECB again emergency liquidity for Greek banks valid until Monday, June 22, 2015, moving Greece on the road of a possible Euro-zone exit. EU leaders received new Greek reform proposals cautiously, saying German economic experts the ‘Grexit’ is the solution, raising ECB its Emergency Liquidity Assistance/ELA to Greek banks again to €89 Billion. Greek debt declared by analysts as still sustainable, but will miss debt targets set out by creditors in 2012, seeing the IMF as worst case Greek debt falling to 142,2% of GDP in 2022 from 176,7% of GDP in 2015, assuming a new bailout program of at least 3 years with concessional financing. The Euro-zone readies to deal with a Greek debt default after its other 18 members refused unanimously to extend bailout program beyond June 30, 2015, the day Greece must pay €1,6 Billion to the IMF, following PM Tsipras’s surprise announcement of a referendum to take place on July 5, 2015, on an offer from creditors that his leftist Government rejected. Greece is set to introduce capital controls, keeping from June 29, 2015, Athens stock exchange and Greek banks closed, after ECB refused to increase emergency funding to Athens, saying analysts there may be a wave of contagion, affecting peripheral Government bond spreads, eventually weakening the Euro and contributing to new market volatility. Standard & Poor’s downgraded Greece’s credit rating again from CCC to CCC-, after Athens announced it will not pay €1,6 Billion to the IMF due on June 30, 2015. Greek aid Program expired on June 30, 2015, missing Athens its June 30, 2015-payment to the IMF, finding itself effectively in default, saying the Eurogroup Athens’ stance towards its creditors would have to change before its Euro-zone partners could consider any additional financial assistance, depending on the result of the referendum on previous EU credit terms, warning the IMF Greece will need €50 Billion more in financial assistance until the end of 2018, and must reform before getting debt relief. After the referendum, voting Greeks against the new EU bailout conditions, supporting their leftist Government, PM Tsipras offered creditors a reform package, including last-minute concessions, appealing to his party’s lawmakers to back it, intending to save the country from a financial meltdown, calling France the new proposal as trustworthy and serious. Greece won a conditional agreement to receive a third bailout of €86 Billion over three years, which may still face opposition within the Greek’s coalition government, needing the authorization of the German Parliament to opening loan negotiations. According to IMF secret report Greece will need far bigger debt relief the Euro-zone partners have been prepared to envisage so far, expecting a 30-year grace period on servicing all its European debt, including new loans, and a very dramatic maturity extension, passing Greek lawmakers a tough economic package demanded by Euro-zone as part of the bailout deal, rising ECB Emergency Liquidity Assistance/ELA for Greek banks by €980 Million to nearly €90 Billion, approving European Finance Ministers €7 Billion in bridge loans, allowing Greece to pay a key obligation of €4,2 Billion to the ECB and clear its arrears of about €2 Billion with the IMF, reopening Greece its banks, deciding the European Stability Mechanism/ESM to open formally negotiations with Greece on a third bailout program worth up to €86 Billion over three years, after German lawmakers backed the new Greek bailout, seen as a last attempt to fulfill this extraordinary difficult task, raising Standard & Poor’s Greece’s sovereign credit rating by two notches to CCC+ from CCC-. Greece and its lenders reached a new up to €86 Billion bailout agreement, needing to be adopted by the Greek Parliament and approved by Euro-zone countries, while a strong first review of the implementation of measures will take place in October 2015 and any discussion of debt relief has to come later. Greece will get €26 Billion as a first tranche of the three-year bailout program, €13 Billion very early to cover its debt repayment needs and an initial €10 Billion to be set aside at the ESM to bolster the capitalization of  Greek banks, which will have to pass a stress test before receiving fresh equity, while the remaining €3 Billion of the first €26 Billion tranche will be disbursed in the coming months in return for Greek reform progress, renewing the IMF call for the Europeans to grant Athens debt relief to make its global debt sustainable as condition to study an involvement in the bailout deal, considered as indispensable by the Eurogroup. Euro-zone Finance Ministers agreed with some additional measures to the Memorandum of Understanding to lend Greece up to €86 Billion, after Greek lawmakers accepted their stiff conditions despite a revolt by supporters of leftist PM Tsipras, which may lead to a confidence vote and eventually to early elections. PM Tsipras resigned paving way for snap elections to be held on September 20, 2015, which could allow him to return to power in a much stronger position without anti-bailout rebels in Syriza to slow him down, opposing the toughest part of the latest program, including further pension cuts, more value-added tax increases and a ‘solidarity’ tax on incomes, hoping the Eurogroup that the resignation would not delay or derail implementation of the bailout package, increasing eventually support in Greece for the third Euro-zone bailout program. Greece’s interim cabinet headed by caretaker PM Vasiliki Thanou has been sworn in and the Greek Parliament has been dissolved ahead of the snap elections to take place on September 20, 2015, giving the latest opinion survey Ex PM Tsipras a lead against his opponents backing 23% of voters his Syriza party. Leftist Tsipras and his Syriza party return to power with an unexpectedly clear election victory, forming Tsipras as new PMagain a coalition Government with his former partner, the right-wing populist party of independent Greeks/ANEL, obtaining Syriza 145 seats and ANEL 10 seats, gaining a narrow majority of 155 seats of the 300-member legislature, expecting Greece’s European creditors a swift and full implementation of the bailout deal. Greece is likely to qualify for recapitalization funds for its banks by a November 15, 2015, deadline, as the ESM has up to €25 Billion earmarked for the recapitalization of the Greek banking sector, having already disposed €10 Billion to be available, ready to be wired to Greece. According to the stress tests of Greek banks they have to raise €14,4 Billion of extra capital to cover mounting unpaid loans, reaching the total of non-performing loans €107 Billion, expecting the ESM that the third bailout for Greece will be smaller than the initially envisaged €86 Billion because Greek banks need less recapitalization. Greek Parliament approved a 2016 budget, including sharp spending cuts and some tax increases to satisfy the country’s internacional lenders, at a time of growing austerity fatigue. EU Ministers explored specific measures for a possible debt relief, which could be offered to Greece, ‘if necessary’, at the end of the bailout in 2018 if the country implements all the agreed reforms; the IMF however is insisting to give Greece eventually earlier a break on its future massive debt repayments. Euro-zone Finance Ministers will release €10,3 Billion in new funds for Greece in recognition of painful fiscal reforms pushed through by PM Tsipras, agreeing also to offer Athens debt relief in 2018 if that is necessary to meet agreed criteria on its payments burden, securing an agreement with the IMF to again joining the Euro-zone in funding the bailout for Greece. The Euro-zone granted Greece a short -term debt relief, while it’s still unclear if the IMF may join the Greek bailout Program of up to €86 Billion, continuing discussions how far Greece has advanced with reforms needed  for the release of the next tranches of loans. Greece received another credit lifeline worth $9,5 Billion advancing negotiations for a possible debt relief including finally also the IMF. Italy took over EU’s rotating Presidency for the second half of 2014, winning Renzi’s centre-left Democratic Party/PD by nearly 41% of the vote at European elections, coming not only first, but first with a margin of almost 20 points, getting chief rival anti-Establishment Five Star Movement  /M5S of Beppe Grillo only 21,2%, becoming PD, winning more votes that any other party in the EU, the second largest force in the European Parliament, pledging Renzi that EU should focus more on growth, employment and reforms. Re-elected British PM Cameron promised an in-out EU referendum before ending 2017, warning President Obama Cameron of risks if Britain exits EU, signaling Goldman Sachs European banks would leave London ‘in very short order’ if Britain voted to exit EU, saying Standard & Poor’s Britain’s top credit rating is at risk because of the planned European Union referendum, lowering the outlook on the country’s AAA rating to negative from stable. Legal protection for London’s banks will be at the heart of UK’s EU reform plans, warning British Chancellor Osborne that a failure to change Lisbon treaty would prompt Britain to leave EU, saying shortly non-€uro-zone States will have to choose between joining the €uro or leaving EU, insisting ‘we don’t want to join the €uro’. EU leaders agreed on budget deal cutting ‘payment ceiling’ to €908,4 Billion, meeting austerity demands of British PM, reducing the higher ‘commitment ceiling’ to €960 Billion for the next seven-year budget 2014-2020. PM Cameron won a surprisingly solid victory in the British general election, leaving a stunning disappointment for the opposition Labour Party and its leader, Ed Miliband, who stepped down, gaining Conservatives in the 650-seat-House 331 seats, while Labour will hold 232 seats, accepting for five more years re-elected PM Cameron mandate to form first majority Conservative Government since John Major’s surprise victory in 1992, repeating Cameron a promise to hold a referendum on the membership in the EU. Moody’s downgraded UK’s AAA rating one notch to AA1. Greece’s international lenders discussed Greek financial requirements and extrafunding needs over €32,6 Billion, agreeing to reduce Greek debt by €40 Billion to 124% of GDP by 2020, putting together a package of steps, including debt buyback from private investors providing EFSF/ESM funding of about €10 Billion, return of profits of €11 Billion and also future accounting profits on ECB’s holding of Greek bonds, a reduction of lending rates on the first Greek aid package, an extension of repayment terms by 15 years of old and new bilateral and EFSF loans and deferring EFSF loans’ interest for 10 years. Greece’s leftist PM Tsipras said the EU was ‘sleepwalking towards a cliff’, expecting a debt relief for itself to be honored by end-2016 so that the economy could recover, considering that ‘Brexit’ will either awaken European leaderships or it will be the beginning of the end of the EU. After contracting the Greek economy by 0,2% in the 1stQ. 2016, it expanded by 0,2% in the 2ndQ. 2016, expecting the EU a full year decline of 0,5% or slightly better for 2016, seeing Greece’s economy rebounding by 2,7% in 2017. The German-led European fiscal pact was signed by 25 of the 27 EU nations, with the exception of Britain and Czech Republic. The EU Commission started a European project bond program to finance infrastructure projects involving a cooperation between private stake holders and EIB, EU and member States. The permanent €uro-zone bailout fund ESM entered officially into force October 8, 2012, after the German Constitutional Court ratified with conditions treaty to establish the ESM, saying Euro-zone rescue measures and transfers of competences to Brussels exhaust constitutional framework, remaining Germany’s liability capped at €190 Billion. Euro-nations will allow ESM to leverage its capital with the same techniques as its predecessor EFSF, which failed to attract investors, hoping to boost ESM lending capacity eventually to more than €2 Trillion to bailout if necessary Spain and Italy. The IMF increased its funding of currently around $380 Billion to address global financial needs, totaling new pledges from 37 nations $456 Billion, agreeing the €uro-group to boost the bloc’s bailout lending limit to €800 Billion. Spain asked for €uro-zone help to recapitalize its ailing banks agreeing European Finance Ministers to provide up to €100 Billion, approving EU Commission payment of a rescue package of €37 Billion to bailout troubled banks and of €2,5 Billion for Spain’s planned ‘bad bank’, granting EU Spain two extra years to meet deficit reduction target. €uro-zone rescue funds will be allowed to directly recapitalize banks, not adding to national debt level, once a single banking supervisory mechanism overseen by ECB has been set up, obtaining Italy commitment that the EFSF may purchase limited amounts of Government debt provided the country sticks to its current reform program, approving leaders a €120 Billion growth package, including proposed EIB €10 Billion capital increase. The ECB announced to expand its sovereign bond-buying program reaching actually €208,7 Billion, setting initially no limits on the amounts of bonds to be purchased with remaining maturities of one to three years to bring down the interest rates of crisis nations, confirming it will not treat itself as a preferred creditor, announcing January 2015 a more than Euro 1 Trillion QE program, saying it will buy Euro 60 Billion in sovereign debt from March 2015 through September 2016 to revive Euro-zone economy, warning analysts you cannot address structural reforms with monetary policy. There was a consensus about risk sharing, meaning only 20% of purchases will be the responsability of the ECB and 80% of national central banks, buying up sovereign bonds in proportion to their ‘capital key, which would have to absorb any potential losses should a Government of the Euro-zone default. After Standard & Poor’s and Moody’s also Fitch lowered French sovereign debt rating from ‘triple A’ to ‘AA+’, agreeing EU to give France two extra years to meet EU deficit target of 3%, asking France for still more time to cut budget deficit, rejected by the European Commission, cutting Standard & Poor’s France credit rating from AA+ to AA, saying Paris is not implementing needed reforms to repair economy, unveiling French President Hollande plans to find around €50 Billion of spending cuts between 2015-2017 to help narrow budget deficit, reducing corporate charges by €30 Billion as part of a ‘responsability pact’ with employers. Shifting the ECB away from austerity, France announced in September 2014 it will not reduce its budget deficit to within EU limits until 2017, finally accepted by the EU, growing deficit steadily to 4,7% of GDP in 2016, despite having already been granted extra time to do that by 2015, although it has been expected France would set an example and show budget discipline, seen as the anchor of confidence in the European Union. Ruling Socialist lost local French elections, naming Hollande, facing the lowest popularity levels, new PM, winning Le Pen’s anti-Euro National Front with 25% of the vote European Parliament elections, becoming the strongest party in France, pushing Hollande’s ruling Socialists with only 14% into third place, gaining French far-right first Senate seats, losing Hollande’s Socialist Party its majority in the Upper House to centre-right UMP. Fitch cut France’s credit grade one notch from AA+ to AA, saying Paris has fallen short in its efforts to trim fiscal deficit, lowering Standard & Poor’s, which already reduced France’s rating to AA, its expectations of a debt reduction of the country, lowering Moody’s France’s Government bond rating one notch to ‘Aa2’ with a stable outlook from ‘Aa1’ with a negative outlook, because of the country’s continuing weakness in the medium-term growth outlook. Liberal Emmanuel Macron has been elected as new President of France, succeeding Hollande, giving a vote of confidence to France and Europe, reducing uncertainties of the Euro-zone, seen as a good news to open trade and globalization. German Chancellor Merkel y President Macron agreed to draw up a road map to deeper EU integration, despite scepticism in Berlin over his proposed reforms. EU plans to implement the 11-nation financial transaction tax from 2014, failing its introduction EU-wide, opposed by Britain and Sweden. European leaders agreed on a supervision plan putting €uro-zone’s about 130 largest banks under the direct oversight of the ECB, which promised to put €uro-zone banks through a rigorous stress test before assuming supervisory role in November 2014, becoming French central banker Danièle Nouy €uro-zone’s new super-regulator. Italian Senate approved expulsion of Berlusconi from Parliament following his conviction for tax fraud, given for his year sentence community service. Florence mayor Renzi, who wants to remodel the left, became the new leader of Letta’s centre-left Democratic Party, voting the party in favor of urgently needed reforms, prompting Letta’s resignation accepted by President Napolitano, asking Renzi to form a new Government, who was sworn in as PM, promising to quickly enact economic reforms to get the country out of financial difficulties, announcing a sweeping fiscal reform, reducing income tax by a total of €10 Billion annually for 10 Million low and middle income workers from May 1, 2014, saying they would help economic recovery without breaking EU budget deficit limits. Standard & Poor’s downgraded Italy’s long-term credit rating due to economic weakness from BBB to BBB-, just one level above junk, with a stable outlook, expecting a growth of only o,2% for 2015, measure seen as a blow to PM Renzi, resigning President Napolitano January 14th, 2015, giving the country two weeks to find a successor, posing new risks for PM Renzi, whose candidate is constitutional court judge and one-time Christian Democratic Minister Sergio Mattarella, with a reputation of integrity, who finally was elected in a fourth vote by the Italian Parliament as new President, considered as a victory for PM Renzi. Italians voted no rejecting in a referendum on whether to streamline its baroque legislation, constitutional changes, dealing a blow to PM Renzi, who resigned, succeeded by Italy’s new PM Paolo Gentiloni, a loyalist from Renzi’s Democratic Party (PD). Italy’s Government adopted to support the banking sector starting with a bailout of Monte dei Paschi di Siena and should reduce contagion risks for other banks. Standard & Poor’s downgraded Finland from AAA to AA+, leaving only Germany and Luxembourg with the AAA rating in the Euro-zone, maintaining Moody’s and Fitch still Finland’s AAA rating. Chancellor Angela Merkel secured a big election win, beginning her third four-year term as German Chancellor after forming a ‘grand coalition’ with the Social Democrats.  Germany’s current account surplus has come under scrutinity from the U.S., the IMF and the EU, as it hits about 7% of GDP since 2007, expected to remain also in 2014 and 2015 above the EU 6% threshold, facing the ‘slow’ pace of domestic demand growth and the dependence on exports criticism, calling the U.S. Treasury on Germany to push domestic demand, importing more to boost other economies in Europe. German officials explain that the €uro-zone as a whole has a very small surplus and without the German surplus toward third countries the €uro-zone would have no surplus at all but a deficit; the U.S. deficit won’t be improved by an European one being added to it; the German economic growth has been driven mainly by domestic demand recently. EU leaders postponed a deeper discussion of the future of the Economic and Monetary Union/EMU because of no reform consensus between France and Germany and because of the more pressing migration issue, planning the European Commission to give more budget leeway to States that can prove to have suffered extraordinary costs to face the refugee crisis. German Chancellor Merkel, facing pressure from her conservative supporters as much as from opponents, called Europe vulnerable and the fate of the Euro ‘directly linked’ to resolving the migration crisis, while Berlin and Brussels continue to ask for more distribution across Europe. But Germany is counting on little help as leaders of EU co-founder France fear an anti-immigrant National Front and EU’s third largest economy Britain is consumed with its own debate on whether to just quit the European Union all together. Europe could face a wave of migration that may eclipse today’s refugee crisis if growing global economic troubles are getting worse. The European Union sealed a controversial deal with Turkey intended to halt illegal migration flows to Europe in return for financial and political rewards for Ankara, remaining doubts if it’s legal and workable as German Chancellor Merkel recognized, who was a driving force behind the agreement. Germany is seeking the creation of ‘safe zones’ to shelter refugees in Syria; keeping refugees on the Syrian side of the border would help Brussels and Ankara, which hosts 2,7 Million Syrian refugees, stem the flow of migrants to European shores, warning the U.N. against the plan unless there was a way to guarantee the refugees’ safety. The EU is intending to convince Britain with a new compromise reform package to accept a deal in a bid to prevent a ‘BREXIT’, saying PM Cameron he’ll hold the long-pledged referendum on the UK’s membership in the European Union on June 23, 2016, recommending to remain in a reformed EU, warning U.S. President Barack Obama during his visit to London that if Britain votes to leave the European Union it will only suffer disadvantages and could be waiting a decade for a free trade deal with the United States. British voted for EU exit, as 52% were in favor of leaving the European Union, claiming they want an independent Britain, resigning PM Cameron, plunging global markets, expected to slow further global growth. Theresa May will become British PM on July 20, 2016, succeeding Cameron, and is the new leader of the Conservative Party who will lead Britain’s negotiations to exit the European Union. British PM May will not hold a parliamentary vote on ‘BREXIT’ before formally triggering Britain’s withdrawal from the EU, as a majority of the 650 lawmakers had declared themselves ‘remainders’. According to opponents elected lawmakers should review the vote before the process is started, since the EU-referendum is not legally binding. ‘BREXIT’ will require a vote in Parliament, U.K. court rules, a decision which seems likely to slow, but not halt the process. Britain’s Supreme Court ruled that the Government must seek parliamentary approval before invoking the formal process for leaving the EU, a decision considered as a victory to parliamentary democracy; the ‘BREXIT’ process has been formally activated by British PM May on March 29, 2017. The EU-Parliament, which has the final say on any ‘BREXIT’ deal, adopted its ‘red lines’ for tough ‘BREXIT’ negotiations, insisting Britain first agree divorce terms before striking a new trade deal. EU27 adopted a united stance on ‘BREXIT’ and urge Britain to be more realistic in its approach, suggesting that tough negotiations are ahead. EU officials are preparing for talks on Britain’s exit from the bloc to begin on June 19, 2017, after the British election on June 8, 2017. Ruling British Conservatives lost their parliamentary majority forming PM May a minority government backed by a small Northern Irish party, seen fighting for survival, weakening her position for the coming ‘BREXIT’ negotiations. German officials said the plan was to agree a rollover of EU sanctions against Russia, which are due to expire at the end of January 2017, but there is concern that President-elect Republican Trump might move in the opposite direction after his inauguration on January 20, 2017, fearing the EU that Russia will use the time before Trump’s inauguration to launch new offensives in Syria and Ukraine. The EU agreed to extend Russia sanctions until mid-2017 in a signal to Trump, formally extending again its sanctions against Russia until January 31, 2018. European Parliament President Martin Schulz steps down, saying he would not stand for re-election as speaker of the EU legislature, returning to German politics, becoming the Social Democrats candidate to challenge Conservative Merkel’s bid for a fourth term as Chancellor. Italian conservative Antonio Tajani, a former EU commissioner and an ally of former premier Silvio Berlusconi, was elected president of the European Parliament, succeeding German Social Democrat Martin Schulz. The recent lack of a G20 rejection of protectionism evidenced the pressure of an increasingly protectionist United States under President Trump and may lead to a weakening of the World Trade Organization/WTO and a more aggressive use of protectionist policies, pledging two of the world’s strongest export nations, Germany and Japan, to keep global trade free and open defending globalization, supported also by China, saying globalization is unstoppable, marking eventually China’s rise and America’s decline, where growth under President Trump remains modest. After President Trump declined to endorse in Brussels NATO’s doctrine of collective defense, leaving a fragile Atlantic alliance, and resisted during the G7 summit in Sicily to agree to any deal that would see the U.S. remain in the Paris climate accord, and allowing only shaky agreement of free trade, a frustrated German Chancellor Merkel convinced that the times when we could completely rely on others are over to a certain extend, underlining her doubts about the reliability of the United States as an ally, said Europeans must really take our fate into our own hands, without the United States and Britain. President Trump announced that the U.S. will pull out of the Paris climate change agreement, rejecting and regretting international leaders his decision, reaffirming China and India their commitment to meeting their targets, responding France and Germany that the Paris agreement could not be renegotiated. In the eve of the G20 meeting in Hamburg, Japan and the European Union signed the Japan-EU Economic Partnership Agreement/JEEPA, a trade deal that has been four years in the making, wanting both sides to show they can fill the vacuum left by America’s withdrawal from its role as the world’s trade dealer. The European Union and Canada said they agreed to start a free trade agreement, the Comprehensive Economic and Trade Agreement/CETA, on September 21, 2017, paving the way for over 90% of the treaty to come into effect. Once dominant the United States found itself isolated at the G20 in Hamburg, as on issues like immigration, trade and climate change the Trump administration stands alone. According to the latest reports UK’s final Brexit divorce bill will reach more or less €50 Billion, which the British would have to pay to leave the EU. EU opened next Brexit phase allowing to begin crucial talks on a future relationship with Britain, after 27 EU-counterparts of PM May endorsed an interim deal on the terms of Britain’s divorce from the EU. The European Union wants transition period after Brexit to end not later than the last day of 2020, according to the EU’s negotiating directives now agreed on. Brexit: UK’s PM May gave a two years’ notice under Article 50, and that takes effect at 11:00 p.m. London time  on Friday, March 29, 2019. A final deal has to be ratified by all remaining EU 27 members, the European Parliament and the European Commission. After Italian elections, gaining populist parties ground at the expense of establishment voices, coming lengthy coalition talks with no clear winner, with no single party or straightforward coalition seemingly able to form government. Italy will be led by populist Guiseppe Conte, initiating the EU-critical government, which opposes the Euro and illegal migrants. Prime Minister Mariano Rajoy of Spain lost a no-confidence vote, ousting one of Europe’s longest serving leaders from office over a major corruption scandal within the Conservative Party, becoming socialist Pedro Sanchez Spain’s new PM, adding to political uncertainty in Southern Europe, after populist Conde was sworn in as PM in Italy. European Union leaders agreed a hard-fought accord on migration, combining a more effective control of EU’s external borders. European leaders agreed to extend their economic sanctions against Russia for six months until the end of January 2019, for annexing Crimea from Kiev and backing rebels fighting Government troops in east Ukraine. The two populist parties governing in Italy agreed on a 2,4% deficit target for 2019, still below the EU’s threshold of 3%, but three times higher than the number the previous government had planned, and could spark negative market reactions, given that Rome holds the second highest debt pile in the Euro-zone totaling €2,3 Trillion/$2,67 Trillion. Brexit seems to be heading towards no-deal, as UK’s exit from the European Union is scheduled to occur in March 2019, actually at a very critical moment, intending negotiators to conclude talks before November 2018. Europe’s 48 Bigger banks passed the EU wide examination carried out by the European Banking Authority/EBA and the Single Supervisory Mechanism/SSM,  beating the common tier ratio of 5,5% under adverse stress, ranking British Barclays Bank lowest in the test. Britain and the EU agreed on a draft text setting out a close post-Brexit relationship. British PM May and the 27 remaining European Union member countries sealed a deal, the withdrawal agreement and an outline for a future trade negotiation, which will start once the U.K. has left, saying E.U. it was the best package Britain will get in a warning to the British Parliament not to reject it. Now PM May will have to win over critics in her own Conservative party and must get the deal through a vote in Parliament. If the agreement fails to win approval of the House of Commons, the U.K. will be on course to crash out of the E.U. in a chaotic ‘no deal’ split on March 29, 2019. President Trump warned that the Brexit agreement could threaten future U.S.-U.K. trade deal. Meanwhile the European Court of Justice will hear arguments in Luxembourg on whether the U.K. can unilaterally reverse its decision to leave, and if so, under what conditions. But what’s worrying the E.U. still more are Italy’s budget difficulties, starting disciplinary measures against the country which confirmed it would not backtrack on its expansionary 2019 budget law, however finally says if it appears necessary to reduce deficit a little bit during negotiations with the European Union, it won’t be a problem. British Parliament is due to vote on December 11, 2018, on EU divorce deal. British Pound jumps, after a senior European Union legal advisor said Britain could unilaterally withdraw its Brexit notice. EU’s 27 finance ministers, without Britain, reached a Euro-zone reform deal to fight against a financial crisis, expanding the responsabilities of the European Stability Mechanism/ESM, but without including far grander visions, such as designating a Euro-zone finance minister or setting up a European-style IMF. Party members voted for the preferred Chancellor Angela Merkel’s candidate Annegret Kramp-Karrenbauer, a centrist, considered by the opposition as a continuity candidate, to replace Merkel as new German CDU party leader. PM May abruptly postponed a parliamentary vote on her Brexit deal, throwing Britain’s plan to leave the E.U. into a chaos, saying she would return to the E.U. for further talks in a perceived sign of weakness. The U.K. would meanwhile step up contingency planning for a no-deal Brexit, when it is due to leave on March 29, 2019. The European Council President Donald Tusk cited that the E.U. was ready to discuss how to smooth ratification of the deal by Britain’s Parliament. May will seek further assurances from the E.U. on the working of a backstop that could align Northern Ireland more closely with the E.U. than the rest of the United Kingdom. PM May survived a crucial no-confidence vote, but more than a third of lawmakers said she was no longer the right leader to implement Britain’s exit from the European Union. The U.K. cabinet agreed that delivering the deal that the PM agreed with Brussels remains the Government’s top priority and the best no-deal mitigation. However decided that emergency no-deal Brexit contingency plans must now be implemented across Government, including reserving ferry space for supplies and putting 3.500 armed forces personnel on standby to deal with any disruption. The British Government said it would send advice on preparing for no-deal to all U.K. businesses and suggested they should begin implementing their own contingency plans as they saw fit, growing calls for a second vote on Brexit. The European Commission is revealing that it has started to implement its preparation for a no-deal Brexit in case the U.K. crashes out of the E.U. without a plan in March 2019. The measures are designed to limit disruption in certain key areas, such as finance and transport, but will not – and cannot mitigate the overall impact of a no deal scenario, it’s an exercise in damage limitation. Most of U.K. PM May’s Conservative Party members oppose her Brexit deal, a survey showed. Britain plans to hold a vote in parliament on the government’s deal to leave the E.U. on January 15, 2019, amid talk of delay. British lawmakers defeated by a record margin PM May’s withdrawal deal from the E.U., facing PM May after her Brexit plan was crushed a no-confidence vote that could topple her government, suggesting European Council President Tusk that U.K. lawmakers revoke the country’s decision to leave the E.U., saying it’s the only positive solution left on the table. PM May survived a vote of no-confidence in Parliament, but the path of Brexit remains unclear. Political leaders are calling on their fellow opposition party, Labour, to join them in a growing opinion for a second Brexit referendum, known as a ‘People’s Vote’, while PM May is telling Labour leader Corbyn that it’s ‘impossible’ to rule out a ‘no deal Brexit’ before talks, saying Corbyn that the starting point for any talks to break the Brexit deadlock must be to rule out a disastrous no deal outcome. Germany and France signaled willingness to delay Brexit extending the negotiating time beyond March 29, 2019, announcing France that it is activating a no deal Brexit plan. According to the U.K. government Parliament will debate and vote on a PM May’s Brexit plan ‘B’ on January 29, 2019. Theresa May insists Brexit deadline March 29, 2019, still stands. The British opposition Labour Party said it would support a new Brexit referendum, offering new hope to opponents of withdrawal from the E.U..