Brussels Edition: Dirty Money, Brexit’s High Noon | Eurasia Diary -

6 July, Monday

Brussels Edition: Dirty Money, Brexit’s High Noon

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After reaching an agreement on the modalities of a euro-area budget late last night, money laundering is high on the agenda of finance ministers meeting in Luxembourg today. Since last year’s “action plan” meant to respond to a host of scandals in the European financial system, more problems have come to light — most recently at Dutch lender ABN Amro. Questions remain about what the bloc should do about the many shortcomings that have been identified and if a major overhaul of the framework, such as setting up a dedicated agency to fight dirty money, is needed. 

What’s Happening

Brexit’s Fate | It’s Brexit’s high-noon moment. Around lunchtime today, Prime Minister Boris Johnson will hold private talks with his Irish counterpart, Leo Varadkar, to explore whether the two sides can find room to compromise. It’s a meeting that’s set to seal the fate of Brexit, and signs aren’t good.

Round Two | Emmanuel Macron’s EU commissioner pick is in for a tough grilling. In a brutal confirmation hearing last week, EU lawmakers attacked Sylvie Goulard for her ongoing judicial issues and outsize portfolio — ranging from tech and defense to space — and asked her to come back for further explanations. This morning she’ll have to convince them she’s fit for the job.

Suing Poland | The Commission is set to sue Poland over a disciplinary regime for judges, testing one of the ruling party’s main policies just days before a general election it’s widely expected to win. The move, to be announced as soon as today, puts the erosion of democratic standards back at the center of the campaign ahead of Sunday’s vote and may upset plans to reset ties with Brussels. 

Romanian Instability | Romania is on the brink of losing a third prime minister in as many years as the minority government faces a no-confidence motion. Opposition lawmakers complain about a lack of investment and damage to the judiciary, while the ruling party points to boosted salaries and pensions. Even if the opposition succeeds, any coalition it cobbles together is likely to be weak.

Catalan Verdict | Spain is bracing for an imminent Supreme Court verdict in the trial of leaders of a failed attempt by Catalan separatists to declare independence in 2017. If the court hands down tough sentences, expect mass protests across Catalonia. The government’s handling of any unrest will come under close scrutiny, especially ahead of a general election on Nov. 10.

In Case You Missed It

Turkey’s Gamble | The EU condemned Turkey’s offensive against Kurds in Syria. But that’s the least of Ankara’s problems, Selcan Hacaoglu and Marc Champion explain.

Cunning Plan | Spain’s acting Prime Minister Pedro Sanchez said he will announce a plan next Sunday to end the long-standing political stalemate and form a government following next month’s election. While he didn’t say what his proposal would focus on, the prospect of a solution by December may help restore confidence in a country battered by uncertainty. 

Resisting Populism | Hungary’s opposition parties are banding together for the first time in local elections to form a common front against Prime Minister Viktor Orban. A strong showing on Sunday, particularly in Budapest, could give the opposition momentum for the 2022 parliamentary vote, while failure to reclaim big cities would point to a likely fifth term for the standard-bearer of European right-wing populists.

Greek Miracle | Greece, the one-time bond-market pariah at the heart of Europe’s sovereign debt crisis, completed a transformative journey by joining the region’s negative-yield club. Investors are now paying for the privilege of lending it money.

Chinese Quarrel | After taking on NBA basketball, China is turning its ire on Prague after the picturesque Czech capital withdrew from a sister-city partnership with Beijing. The conflict has been brewing since the upstart Pirate party took over the Prague mayor’s office and raised issues with Beijing’s “one China” policy with regard to Taiwan and Tibet.

Chart of the Day

The U.S. dropped from the top spot in the World Economic Forum’s annual competitiveness report, losing out to Singapore. The EU countries that made the survey’s top 10 are the Netherlands, Germany, Sweden, the U.K. and Denmark. 

Today’s Agenda

All times CET.

  • 9 a.m. EU finance ministers gather in Luxembourg
  • 9:30 a.m. Confirmation hearing of French Commissioner-designate Goulard resumes at the European Parliament
  • 1 p.m.  ECB publishes the account of its September policy meeting
  • European lawmakers debate measures to make EU investments more environmentally-friendly with European Investment Bank President Werner Hoyer
  • Commission is expected to approve an asset protection scheme to help Greek banks clean up their balance sheets
  • Single Resolution Board bank resolution conference with speakers including SRB Chairwoman Elke Koenig, Commissioner Margrethe Vestager and UniCredit CEO Jean Pierre Mustier
  • Possible verdict in trial of Catalan independence leaders

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