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October 24, 2016

Ceta - the next deadline

The newspapers are talking about a deadline, another one, but today is really only the day when Donald Tusk and Jean-Claude Juncker will inform the Canadians whether the planned EU/Canada summit scheduled for this Thursday will take place. This follows a series of dramatic meetings over the weekend. Negotiations between Paul Magnette, the Socialist prime minister of Wallonia, and Chrystia Freeland, Canada's trade minister, ended in acrimony on Friday. Martin Schulz followed with an attempt to broker a compromise on Saturday. As of this morning, it does not look good. 

FAZ notes that one technical possibility for a compromise could be a commitment that the next technical revision of Ceta would include a revision of the disputed tribunals - arbitration courts that operate outside the legal system. We find it very doubtful that Magnette will go for that. To judge by some of his comments over the weekend, he did not sound like a man about to make a U-turn. He tweeted that it was a shame that the EU was putting so much more pressure on him than on those who block the fight against tax fraud.

Le Soir reports that Magnette felt deceived by the Commission, which kept on handing out new assurances on the interpretation of the investor tribunals. One source from the Walloon government is quoted by AFP as saying:

"They give us a disappointing document and in parallel we are given an ultimatum. This is very surprising. It prompts us to ask questions about the purpose... This document astonishes us insofar as it is far less advanced than those given on Friday and Saturday"

That document, sent out on Sunday, gave specific assurances about the role of the judges in the independent investor tribunals. They would be paid by the EU and Canada, and would be employed on a permanent basis. 

Among the commentators, we noted Dani Rodrick, who writes that it is not helpful to complain about the Walloons. Much of the blame lies with policy elites and technocrats who pooh-poohed peoples' concerns with earlier trade agreements. They minimised distributional concerns, and oversold aggregate gains from trade deals. 

"The opposition to trade deals is no longer solely about income losses. The standard remedy of compensation won't be enough -- even if carried out. It's about fairness, loss of control, and elites' loss of credibility. It hurts the cause of trade to pretend otherwise."

Hendrick Kafsack bemoans in FAZ that this was an unusually progressive trade deal. Canada agreed to production lines for not-hormone treated beef, and the tribunals are a good response to the legal difficulties investors faced abroad. He noted that Juncker should have declared Ceta EU business-only, which would have avoided national ratification procedure.

On Juncker: did he not try this at the June European Council, and was shouted down by the other heads of government? This mess is not Juncker's fault.

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October 24, 2016

Who will lead Germany?

There are two overriding personnel questions in German politics right now. Will Merkel run again? And who will the coalition nominate to succeed Joachim Gauck as president? Most people, including us, expect Merkel to run. The only senior journalist we know who has been betting against this outcome is Günter Bannas. He has another front-page column in FAZ, in which he wonders why Merkel is hesitating. She missed another good opportunity to announce her candidacy during the party congress of her home state of Mecklenburg-Vorpommern, he writes, adding that it was completely incomprehensible why Merkel is not declaring her intentions. He notes that her own people are getting nervous. Bannas argued in a previous article - but without repeating the same line this time - that the only way to square this is for Merkel to have already decided that she will not run. Only in that case would it make sense not to declare early, given that any successor as CDU-chairman, to be elected at the December party congress, would want her job as chancellor right away. A declaration that she's not running again would immediately turn her into a lame duck. That's, of course, only a theory. We still think she will run, but Bannas' analysis remain at the back of our mind.

The SPD, meanwhile, has now formally proposed Frank Walter Steinmeier, Germany's intensely pro-Russian foreign minister, for the soon-to-be-vacant role of German president. Steinmeier's nomination is a dilemma for Merkel as she cannot easily allow the SPD to claim that job after they proposed Gauck against her wishes last time. Steinmeier's main role in German politics these days appears be a wish to represent the interests of Russia in Berlin. He  expressed opposition to the stationing of Nato troops in eastern Europe and, over the weekend, he defended the decision not to impose sanctions on Russia at least week's summit, on the argument that this would only generate news headlines, but would not help the people on the ground.

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October 24, 2016

Peasant party upsets Lithuanian election

Lithuania held the runoffs of its parliamentary elections yesterday, two weeks after the first round. While it was expected that the centre-right Homeland Union would win the election, the peasant party LVZS swept the second round and won a large lead with 56 out of 141 seats. Voters heavily punished the outgoing coalition government of Social Democrats, the social-liberal Labour Party, the conservative Order and Justice party, and the Polish minority party.

majority: 71
partyseatschangepositioningaffiliation
Peasant and Green Union56+55AgrarianGreens/EFA
Homeland Union31-2Christian democratEPP
Social Democrats17-22Social democratPES
Liberal movement14+4LiberalALDE
Polish party (LLRA/AWPL)80Polish minorityECR
Order and Justice8-3Right-wingEFD
Labour Party2-27Social liberalALDE
Way of Courage0-7Anti-corruption
independents5+2

LVZS leader Ramunas Karbauskis said he doesn't exclude forming a coalition with the Christian Democratic Homeland Union, or the Social Democrats, either of which could provide the 15 seats the peasant party needs for a majority. Having done worse than at the previous election, contrary to expectations, the leader of the Homeland Union Gabriel Landsbergis does not exclude staying in opposition, though.

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October 24, 2016

Ségolène Royal, seriously?

Francois Hollande is no longer considered to be the natural candidate on the left after the publication of his book. The question now is, who is? Manuel Valls comes to mind. He already behaves like a statesman. But his attempt to represent himself as “rassembleur" this weekend failed, as many of the other candidates refused to rally behind him, Les Echos reports. The press even evokes a return of Ségolène Royal. Christine Taubira is mentioned too. Hollande still considers his candidature a possibility. Bruno Le Roux writes about the danger that without Hollande, the party will split. Jean-Luc Mélenchon is the frontrunner among the left wing of the party, Emmanuel Macron the one of the right wing. The battle about the succession has already began. And it is a fine mess.

Sarkozy supporters, meanwhile, accuse centrist leader François Bayrou of opportunistic behaviour. In an article in Journal du Dimanche, 165 signatories, mostly Sarkozy supporters, attacked Bayrou and with him indirectly also Alain Juppe, who indicated last week that he plans a majority with Bayrou’s party. Bayrou decided in 2012 to support Hollande in the second round rather than Nicolas Sarkozy. His return to the political limelight now irritates many Republicans. 

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