UK PM plans Brexit talks with EU's von der Leyen, warned to reach deal pre-autumn: FT

(Reuters) – British Prime Minister Boris Johnson is planning to hold Brexit talks with European Commission President Ursula von der Leyen in June, with UK officials warning Johnson that an agreement was needed before autumn, the Financial Times newspaper reported.

“We need a broad agreement in place by the summer,” an unnamed UK official was quoted as saying by the newspaper on Monday. “We can’t still be having this conversation in September or October”, the official added.

Downing Street said that the European Union’s plan for a common regulatory framework was “novel and unbalanced”, the report added.

“As soon as the EU accepts we will not conclude an agreement on that basis, we will be able to make progress,” Johnson’s spokesman said in a statement cited by the Financial Times.

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EU chaos: Brussels panic as MAJOR revamp to food industry needed to stop future crisis

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City University Food Policy Professor and author Tim Lang explained the European Union could see some member states food industry struggle post coronavirus. During an interview with Express.co.uk, Professor Lang explained Europe’s over-reliance on migrant labour could prove problematic as travel between nations is expected to change post-crisis. He added countries that do feed themselves are in a better position than those that import much of their food.

Professor Lang said: “For the most part, France feeds itself and the Netherlands feeds itself.

“Britain does not feed itself, unlike Spain and Italy feed themselves.

“Those countries I have mentioned will recover but they all depend upon migrant labour.

“The entire European food model has been based upon very quick flows of migrant labour.”

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Professor Lang also explained what locations those in the food labour industry come from and how it will be impacted post-crisis.

He said: “This is mostly labour from east to west and also from northern Africa to southern Europe for picking in Spain, Italy and Greece.”

Professor Lang also claimed the European Union had a responsibility to ensure all food industry issues are resolved.

Professor Lang said: “Eastern Europe’s Visegrad group, Poland, Czech Republic, Hungary, Slovakia appear to be extremely right-wing in political terms.

“They were posing barriers and putting up borders to stop migrants, adding delays to wagons etc.

“But the EU kicked in and demanded fast access and fast flows for food.

“This is because whatever we all think about the European Union, the EU does not have any powers over health but it does have powers over food.

“Health is a national responsibility and the EU’s coordinating function on food has kicked, belatedly.

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“There were great concerns for that initially.”

Professor Lang also insisted that Britain would need to reassess the structure of its food industry as the nation cuts ties with the European Union.

He said after years of membership to the bloc, the country would need to refocus how quickly it gets food from abroad and where it gets its labour from. 

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Brexit deal possible but EU has to drop ‘ideological approach’ – Michael Gove

A deal on the UK’s future relationship with the EU is possible if Brussels drops its “ideological approach”, Michael Gove has said.

Updating MPs on the state of play in the Brexit negotiations, the Cabinet Office minister said there remained areas where the two sides had “significant differences”.

This includes fisheries, governance arrangements and the so-called level playing field.

“The EU, essentially, wants us to obey the rules of their club, even though we’re no longer members,” Mr Gove told the Commons.

“They want the same access to our fishing grounds as they currently enjoy while restricting our access to their markets.

“It remains difficult to reach a mutually beneficial agreement while the EU maintains such an ideological approach.

“But we believe an agreement is possible if flexibility is shown.”

Britain left the EU at the end of January after 47 years of membership and is currently in an 11-month transition period which ends in December.

This time frame is being used to negotiate a free-trade agreement and sort out the terms of the future relationship that will govern ties between the UK and the EU.

Prime Minister Boris Johnson has insisted he will not extend the Brexit transition period beyond the end of this year, despite warnings that disruption caused by the coronavirus pandemic has made striking a deal impossible.

The third round of talks on the future relationship between the two sides ended last week, with the next round due to begin next month.

Mr Gove, a campaigner for Brexit during the 2016 referendum campaign, said the government had made public the UK’s draft legal texts.

“To help facilitate discussions in the fourth round and beyond, the government has today published the full draft legal text that we’ve already shared with the Commission and which together with the EU’s draft agreement have formed the basis of all discussions,” he said.

“The UK texts are fully in line with the government’s document entitled The Approach to the Future Negotiations which was published on 27 February.”

Mr Gove added: “The government remains committed to a deal with a free-trade agreement at its core and we look forward to the fourth round of negotiations beginning on 1 June, but success depends on the EU recognising that the UK is a sovereign.”

International Trade Secretary Liz Truss, meanwhile, has published the tariff schedule the UK will operate at the end of the transition period for those countries with whom the UK does not have a trade deal.

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Burning EU flag can now bring German jail term

Germany has made public burning of the EU flag or that of another country punishable by up to three years in jail, classing it as a hate crime.

The vote in the Bundestag (parliament) on Thursday makes defiling foreign flags equal to the crime of defiling the German flag.

The same applies for the EU anthem, Beethoven’s Ode to Joy theme.

The move followed Social Democrat (SPD) complaints about protesters’ burning of the Israeli flag in Berlin in 2017.

Justice Minister Christine Lambrecht, a member of the centre-left SPD, said “burning flags publicly has nothing to do with peaceful protests”. She said it stoked up “hatred, anger and aggression”, and hurt many people’s feelings.

The new law also applies to acts of defilement besides burning, such as publicly ripping a flag up. Public display of the Nazi swastika and other Nazi symbols is already banned in Germany.

The far-right Alternative for Germany (AfD) has condemned the new law as “excessive interference in free speech and artistic expression”.

The act of defiling the Union Flag in the UK is not a crime, but France has made desecration of the tricolour punishable by a fine of up to €7,500 (£6,600; $8,000) or six months in jail.

Spain, Italy and Greece also have laws banning desecration of the national flag.

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EU climate chief sees green strings for car scrappage schemes

(Reuters) – The European Union’s chief climate official said on Tuesday there could be green conditions attached to any car scrappage schemes set up by the bloc to revive vehicle demand following the coronavirus pandemic.

The European Commission, the bloc’s executive, is facing calls from carmakers for incentives to boost vehicle sales, which have slumped amid lockdown measures to fight the virus outbreak.

Meanwhile, politicians, investors and campaigners are piling pressure on the EU to use green investments to restart growth and deliver on climate targets.

EU climate commissioner Frans Timmermans said on Tuesday the bloc could heed both calls.

“We see the automotive industry asking us to help them, by helping households to afford a new car,” Timmermans said in a videocall with EU lawmakers.

“But why don’t we do this with ecological scrappage schemes, replacing an old and dirty car with a cleaner, even zero emission one?”

With Europe headed for a steep recession this year, carmakers fear consumers and transport operators will be unable to afford new vehicles.

Lockdown measures have also forced firms to scale back production, although some – including German carmakers Volkswagen and Mercedes-Benz – plan to reawaken some European plants this week.

Attaching green strings to cash-for-clunkers schemes would help boost factories while removing the most polluting cars from Europe’s roads, Timmermans said.

“It’s good for the car industry, it’s good for jobs, and it’s good for the environment.”

European carmaker lobby ACEA called last week for EU measures to stir vehicle sales.

“A dedicated EU-wide fleet renewal scheme for all vehicle categories would be needed to help re-launch demand for the latest vehicle technologies,” ACEA said in a statement.

But campaigners warned that without clear climate rules from Brussels, scrappage schemes could support demand for polluting vehicles.

“The European Commission must issue clear, binding guidance to member states that state aid such as scrappage schemes must target the sales of zero-emission vehicles,” Julia Poliscanova, clean vehicles director at NGO Transport and Environment, told Reuters.

Timmermans said the EU would have an “open ear and an open mind” for industries facing serious challenges.

But he warned that the Commission’s Green Deal plan, to make the EU climate neutral by 2050, is not a luxury that can be tossed aside because of the pandemic.

“It would be a dereliction of duty, not to insist on the Green Deal as a growth strategy to get us out of this crisis,” he said.

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EU leaders to hold coronavirus video conference on April 23

BRUSSELS (Reuters) – European Union leaders will hold a video conference on April 23 to discuss the economic response to coronavirus, the President of the European Council Charles Michel said on Friday, a day after EU finance ministers agreed on half-a-trillion euros worth of support for their coronavirus-battered economies.

“It is time to lay the ground for a robust economic recovery. This plan has to relaunch our economies whilst promoting economic convergence in the EU. The EU budget will have to play a meaningful role here,” Michel said in a statement issued via Twitter.

He called the deal reached on Thursday a “significant breakthrough.”

EU leaders will have to explore the “setting up of a temporary Recovery Fund to ensure a robust European economic recovery in all Member States,” the statement said.

Michel said he is working with the European Commission, the EU’s executive, on a “Roadmap and Action Plan to ensure the well-being of all Europeans and to bring the EU back to strong, sustainable and inclusive growth based on a green and digital strategy.”

The package agreed by finance ministers would bring the EU’s total fiscal response to the epidemic to 3.2 trillion euros ($3.5 trillion), the biggest in the world, on top of measures that member states are taking at national level.

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EU weighs new requirements for firms against biodiversity, pandemic risks

BRUSSELS (Reuters) – The European Commission is considering whether to impose new reporting requirements on firms to shield them from growing risks of biodiversity loss and pandemics, a draft document shows, as the EU grapples with the COVID-19 outbreak.

The document is meant to attract comments from experts and the wider public on next possible legislative steps to strengthen financial sustainability.

Among the issues on which Commission officials are seeking advice is linking managers’ bonuses with carbon reduction results and green capital requirements.

The draft public consultation seen by Reuters asks whether biological risks should be taken into account in a more comprehensive manner when companies disclose investment strategies, in light of the growing negative impact these exposures have on profitability and long-term prospects.

The document, which is expected to be published in the coming days and could lead to legislative proposals at a later stage, says the COVID-19 epidemic is showing more clearly the risks associated with human activity and biodiversity loss.

Experts that it cites suggest that degraded habitats, coupled with a warming climate, may cause higher risks of disease transmission, as pathogens spread more easily to livestock and humans.

“It is important – now more than ever – to address the multiple and often interacting threats to ecosystems and wildlife to buffer against the risk of future pandemics,” the document said.

REPORTING REQUIREMENTS

Among options under consideration are more stringent reporting requirements for listed companies, banks and insurance firms about their exposure to biodiversity loss and pandemic risks.

It asks whether investors and lenders should be required to disclose which temperature scenario their portfolios are financing, notably if they entail a rise of 2 degrees Celsius or more.

The Commission also raises the issue of whether a share of managers’ bonuses should be linked to their climate achievements.

Some firms might be required to include carbon emission reductions among factors that would affect directors’ variable remuneration, the document shows.

Banks could face new capital requirements or incentives linked to their exposure to climate risks, the document shows.

There could be a so-called “brown penalising factor” whereby lenders exposed to coal or other fossil fuel investments would need to set aside more capital to hedge the higher risks posed by polluting assets.

But banks could also profit from a “green supporting factor”, allowing them to reduce their capital requirements if they invest in green infrastructure such as renewable energy facilities.

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Europe weighs a half-trillion euro plan to stem coronavirus recession

BRUSSELS (BLOOMBERG) – It’s crunch time for the European Union (EU) as it strives to stem a virus-led downturn that could eclipse the severity of the Great Recession more than a decade ago.

The EU’s finance ministers on Tuesday (April 7) will seek to endorse a list of measures worth more than half a trillion euros to mitigate the impact of the coronavirus on the region’s economies. If enough headway is made, the bloc’s leaders could debate and sign-off on the measures later in the week.

With the euro area facing an economic slump of unprecedented scale, countries have instituted fiscal measures worth 3 per cent of EU gross domestic product (GDP) as well as liquidity guarantees worth 18 per cent of the bloc’s output. The European Central Bank (ECB) has also launched massive bond purchases in what could end up becoming the biggest economic rescue package the continent has seen in peacetime.

German Chancellor Angela Merkel on Monday said that the pandemic was the EU’s biggest challenge since its founding and that “the answer can only be: more Europe, a stronger Europe and a well-functioning Europe”.

BAILOUT FUND

One measure that’s gained broad support is to have the euro-area bailout fund, the European Stability Mechanism (ESM), offer credit lines worth up to around 2 per cent of output to all the bloc’s members. These loans could be granted to countries with few strings attached that focus mainly on the money going to virus-related spending. Still, some debate is expected on whether the funds should also be conditional on the countries’ fiscal health in the longer run, a longstanding demand of hawkish northern governments including the Netherlands and Austria.

The existence of such facilities should bring down borrowing costs for euro-area countries, and if the loans were needed, they would be available very quickly. Crucially, tapping into the ESM’s 410 billion euro (S$634.7 billion) war chest could also pave the way for the ECB to buy vast amounts of sovereign bonds through its Outright Monetary Transactions program.

Another proposal expected to get the green light is the creation of a pan-European Guarantee Fund to be managed by the European Investment Bank that could mobilize more than 200 billion euros in liquidity for the region’s small and medium sized enterprises.

The ministers are also expected to broadly support a program proposed by the European Commission that would give up to 100 billion euros in loans to countries facing rising joblessness because of the lockdown. The plan would see the EU raise money on international markets backed by guarantees from member states.

JOINT DEBT

Among the more contentious ideas that will likely be discussed is an emergency fund proposed by the French government. According to the plan, the temporary reserve of 3 per cent of GDP would be around for as long as 10 years and would be funded by the joint issuance of debt instruments to mutualise the cost of the crisis.

That would be more controversial as it closely resembles a proposal backed by several euro-area countries for so-called coronabonds – joint debt instruments that would ease pressure on highly indebted countries like Italy and, to a lesser extent, Spain and France, and would reduce the risk of a backlash from bond investors.

Officials say the French proposal could be considered as part of the EU’s plan for economic recovery once the health crisis is over. But it’s still likely to face pushback by countries like Germany and the Netherlands that have long opposed the idea of mutualising risk. They argue that it wouldn’t solve the issue at hand and are wary that they could end up on the hook for spending in the poorer south.

Still, in order to bring Italy and some of the other hard-hit countries on board with the rest of the toolkit, officials expect that some reference to such a notion could be included in the ministers’ agreement, leaving more concrete decisions on such instruments in the hands of their leaders.

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Explainer: Euro zone mulls package to support economy against coronavirus

BRUSSELS (Reuters) – With the euro zone economy in need of help during the coronavirus epidemic, officials have until April 9 to design a package that satisfies members with completely opposing views: those calling for joint debt issuance and those fiercely against it.

Mutualising debt has always been a red line for Germany, the Netherlands, Finland and Austria, but France, Italy, Spain and six other countries have called for “a common debt instrument issued by a European institution” to fight the economic effects of the epidemic.

EU leaders failed to agree last Thursday what to do, and gave ministers two more weeks to work it out. Deputy finance ministers will debate options on Wednesday and Monday and the finance ministers themselves are to hold a teleconference on April 7.

A compromise might emerge by early next week that would include one or more of the following elements in a package:

1. BORROWING BY THE EURO ZONE BAILOUT FUND ESM

One of the main options. The European Stability Mechanism (ESM) is owned by euro zone governments, which are jointly responsible for the debt it issues to finance a government. The ESM could extend standby credit lines, worth up to 2% of GDP, to any euro zone country that asks for it.

The snag is that it would entail a debt sustainability assessment of the applicant — something highly-indebted Italy is loathe to submit to — and carry some conditions, even if focused only on the pandemic. Italy and Spain want no conditions.

2. BORROWING BY THE EUROPEAN INVESTMENT BANK

An option the EU is considering. The EIB, the investment bank of the EU, is owned by EU governments. It finances all kinds of projects supported by the 27-nation bloc and could support companies hit by the epidemic. The EIB raises money by borrowing cheaply on the market thanks to its triple-A rating.

The bank has already offered to immediately deploy close to 40 billion euros of additional funding to help fight the effects of the coronavirus. EIB head Werner Hoyer has also suggested that governments give the bank 25 billion euros in additional guarantees, which could then be used as leverage to mobilize 200 billion euros in additional financing to small and medium sized companies. EU finance ministers — its owners — could also agree to increase the EIB’s capital to further boost lending.

3. BORROWING BY THE EUROPEAN COMMISSION

The European Commission, which also has a triple-A rating, can borrow on the market against the collateral of the EU budget. It did so to raise 60 billion euros for the European Financial Stabilisation Mechanism (EFSM) — an emergency fund created in 2010 when the sovereign debt crisis started.

The EFSM lent money mainly to bail out Ireland and Portugal, but the fund could serve all EU members. There is currently 13 billion euros left. EFSM loans came with conditions.

The Commission could use the mechanism again if governments agreed to set aside EU budget guarantees this year and in the EU’s next long-term budget of 2021-2027.

4. UNEMPLOYMENT RE-INSURANCE

The European Commission has proposed a new state-supported, short-time working scheme to help people keep their jobs as the epidemic takes its toll on economies across the 27-nation bloc.

The scheme is clearly modeled on the German Kurzarbeit plan under which the government pays part of a worker’s wages so that jobs are not cut despite an economic slowdown. It is not yet clear where the money for that will come from.

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Von der Leyen refuses to name Orban after Hungary leader ends democracy to fight COVID-19

The European Commission President couldn’t bring herself to name Budapest’s authoritarian prime minister in her desperate request for EU capitals to respect the bloc’s values while tackling the coronavirus crisis. In an extraordinary power grab, Mr Orban yesterday won the right to indefinitely rule by decree until his government decides to end its state of emergency. The staggering new law removes the need for MPs in the country’s decision-making process and bans elections from being held until the end of the emergency period.

It also introduces tough prisons sentences for anyone spreading “falsehoods” about COVID-19 or Mr Orban’s measures to fight the disease, sparking fears for press freedom in Hungary.

Mrs von der Leyen urged national governments to protect the “values of freedom, democracy, the rule of law and respect for human rights” the EU was built upon in the fight against coronavirus.

In a statement, she added: “Over the past weeks, several EU governments took emergency measures to address the health crisis caused by the outbreak of the coronavirus.

“We are living in extraordinary times, and governments, in principle, need to have the necessary tools to act rapidly and effectively to protect the public health of our citizens.

“It is of utmost importance that emergency measures are not at the expense of our fundamental principles and values as set out in the Treaties.

“Democracy cannot work without free and independent media. Respect for freedom of expression and legal certainty are essential in these uncertain times.

“Now, it is more important than ever that journalists are able to do their job freely and precisely, so as to counter disinformation and to ensure that our citizens have access to crucial information.”

As national lockdowns are extended across the bloc, the EU Commission has vowed to “closely monitor” its members’ actions.

Last night EU justice commissioner Didier Reynders called out the Hungarian government as just one of the reasons the Brussels-based executive might have to clampdown on member states’ coronavirus measures.

Writing on Twitter, the Belgian eurocrat said: “The Commission evaluates the emergency measures taken by member states with regard to fundamental rights.

“This is particularly the case for the law passed in Hungary concerning the state of emergency and new criminal penalties for the dissemination of false information.”

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Critics condemned Mr Orban’s coronavirus measures, which they claim hands the Hungarian prime minister unlimited powers to cement his powers rather than tackle the deadly disease.

David Vig, Amnesty International’s Hungary Director, said: “This is not the way to address the very real crisis that has been caused by the COVID-19 pandemic.

“We need strong safeguards to ensure that any measures to restrict human rights adopted under the state of emergency are strictly necessary and proportional in order to protect public health.”

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Former Italian prime minister Matteo Renzi called for Brussels to kick Hungary from the bloc unless Mr Orban surrenders his powers.

“I have been dreaming of a United States of Europe for years,” Mr Renzi wrote on Twitter.

“Precisely for this reason, I have the right, and the duty, to say that after what Orban has done today, the European Union must act and make him change his mind. Or, simply expel Hungary from the Union.”

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