THU: 12º/5º FRI: 15º/3º
EU finance ministers to call on Copenhagen this weekend
The biggest meeting in Copenhagen of the Danish EU presidency will be held this weekend when European finance ministers meet at Bella Centre for informal talks.
No formal decisions will be made during the ECOFIN meetings on Friday and Saturday, though ministers are expected to make headway on a number of pressing issues.
One of the major points is likely to be how the EU can increase the size of its bailout funds. Starting in July, one of the funds, the ESM, will make €500 billion in cheap loans available to countries struggling to pay their debts. But there are concerns that this will not be enough to ease market fears that debt-laden countries such as Spain, Portugal and Ireland can find funding should they need it.
The European Commission has made several proposals about how to increase the size of the bailout funds. The most likely seems to be allowing the remaining €240 million left over from another bailout fund, the EFSF, to run alongside the ESM. This option means member states will not have to reach so far into their own pockets to strengthen the funds.
The controversial financial transaction tax (FTT) – a levy on the trade of certain financial products such as stocks, shares and derivatives, also known as the Tobin Tax – will also feature in the negotiations. The European Commission’s proposal of an EU-wide FTT still lacks the backing of some key countries such as they UK, without whose support the tax is not likely to be implemented.
As a result, other levies on the financial services industry are being considered in order to find ways of getting the industry to contribute more in taxes and to create a disincentive to the risky trading that is partially blamed for the current financial crisis.
Finally the EU’s next seven-year budget, covering the period 2014-2020, will be discussed. Denmark’s push for green growth in Europe can be seen in the proposals for the budget, otherwise known as the Multi-annual Financial Framework. But MEPs this week questioned whether spending 20 percent of the budget on environmental and climate programmes was necessary.
With Cyprus, a relatively inexperienced EU country, set to take over the presidency from July, there is pressure on Denmark to make as much headway as possible on the important budget negotiations before handing over the reins.
Denmark is generally well regarded in EU circles for being able to handle tricky legislation after it ushered through the largest single expansion of the EU in 2002 when it was last president.
This weekend's Ecofin meetings will mark the halfway point of Denmark’s presidency, thus far considered a success.