ADVERTISEMENT

Brussels Edition: The First of Many Hurdles

Brussels Edition: The First of Many Hurdles

(Bloomberg) -- Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.

It was a narrow win for Ursula von der Leyen, but a win nonetheless — something that seemed far from certain even a couple of days ago. The first woman to lead the European Commission got a first-hand taste of how the continent’s fragmented political landscape could complicate her efforts to push through ambitious legislation over the next five years. She already has ideas on protecting the climate that are likely to stir controversy. At least when it comes to geopolitics, von der Leyen seemed confident in an interview with us that Donald Trump could be persuaded to change his tune.

What’s Happening

Just Laws | Ways to strengthen the rule of law in the bloc will be the subject of a new European Commission policy paper due for publication today, a subject the body’s president-elect signaled she won’t treat lightly. EU ministers will see the paper on Thursday at a meeting where they will also discuss sliding democratic standards in Poland. We’re told no fireworks are expected.

Big Threats | How to respond to Facebook’s Libra currency and strategies for taxing big tech are two of the themes finance ministers and central bankers from the Group of Seven will tackle at meetings today and tomorrow. The risk of currency wars could also creep into the conversation at the Chateau de Chantilly, a ducal residence north of Paris.

Negative Rates | Five years into what was supposed to have been a temporary shot in the arm for the euro area, negative interest rates are stubbornly hanging on. The longer they persist, the louder the criticism grows. 

Probing Amazon | Big tech companies have gotten used to unpleasant summer surprises, and this year is no different, with Amazon on the cusp of being drawn into an EU antitrust probe as soon as this week. Margrethe Vestager, the bloc’s competition chief, is preparing to open a formal investigation she’s been touting for months, one that could eventually slap Amazon with fines or an order to change behavior.

In Case You Missed It

Surprise Shift | Angela Merkel unexpectedly picked Annegret Kramp-Karrenbauer to succeed von der Leyen as defense minister, handing the head of Germany’s Christian Democrats a difficult portfolio as she seeks to shore up her bid to become chancellor after Merkel’s term ends.

German Bears | Investors have gotten more bearish on Germany’s economic outlook for the third straight month, according to a gauge measuring how they perceive prospects for Europe’s largest economy over the next six months. Sensitive to waning global demand, Germany has been mired in a manufacturing slump with no turnaround in sight.

Lobsters and Wine | France’s energy minister resigned after it was revealed he ordered a costly refurbishment of his private residence and splurged on lavish lobster dinners with $550 bottles of wine using tax payers’ money. Based on how he handled the controversy, Emmanuel Macron learned his lessons from the fallout of a scandal last year involving his bodyguard.

Ankara’s Vow | Turkey rebuffed punitive measures by the EU, vowing to push ahead with its energy exploration in the eastern Mediterranean in a growing dispute with Cyprus. The prospect of further tensions is putting pressure on Turkey’s weakened economy just as its longtime alliance with the U.S. is also coming under strain.

Calling Allies | As France and U.S. face off over digital tax, French Finance Minister Bruno Le Maire says he has allies in Donald Trump’s administration who, like him, think sanctions and tariffs aren’t the way to go.

Correction: The Balkan map in yesterday’s newsletter was outdated, not taking into account the Republic of North Macedonia’s recent constitutional name change. Our apologies. 

Chart of the Day

Brussels Edition: The First of Many Hurdles

Africa, a growing economic power, will lead the world in population growth until the end of the century, according to a United Nations report, with the fastest growth in sub-Saharan Africa. At the other end of the spectrum, the biggest declines will occur in some of the former communist states of southeast Europe.

Today’s Agenda

All times CET.

  • 11 a.m. Eurostat to release euro-area inflation data for June
  • EU-Canada summit in Montreal to tackle trade, foreign and security affairs including Iran, climate and energy
  • G7 finance ministers and central bankers gather in Paris 
  • NATO Secretary General Stoltenberg takes part in event at Aspen Security Forum in Colorado

--With assistance from Aoife White.

To contact the editor responsible for this story: Daliah Merzaban at dmerzaban@bloomberg.net, Chris Reiter

©2019 Bloomberg L.P.