The Ukrainian Orthodox Church's stance on the revolution and war. OSW Commentary No. 151, 27.10.2014

Volodymyr (secular name Viktor Sabodan), the Metropolitan of Kyiv and All-Ukraine, the head of the Ukrainian Orthodox Church (UOC), which recognises the honorary primacy of the Moscow Patriarchate, died on 5 July 2014 at the age of 79. He was replaced by Metropolitan Onufry (secular name Orest Berezovsky), aged 70. The fact that this representative of the moderate trend, far from politics, was elected signifies that the UOC’s previous policy will be continued in the coming years: strengthening the Church’s independence without questioning its canonical bonds with Moscow. Metropolitan Onufry’s task is to wait out the hard times, rather than to embark upon an active policy. The political developments this year have significantly weakened pro-Russian views and sentiments among the Ukrainian public, including members of the UOC. On the other hand, they have also contributed to the radicalisation of views within firmly pro-Russian circles. The hierarchs of the Ukrainian Orthodox Church have distanced themselves from these developments. The reasons for this included a lack of unity among them as regards this issue, as well as the leadership crisis linked to Metropolitan Volodymyr’sillness. The main problems the Ukrainian Orthodox Church is facing today are as follows: meeting the expectations of those of its members who hold patriotic views (mainly the younger generation) without at the same time antagonising its numerous members who are pro-Russian; and also continuing to disregard the Kyiv Patriarchate and maintaining bonds with the Russian Orthodox Church. Therefore, we may expect the UOC to continue avoiding taking a clear stance on the present conflict, instead focusing on charity.

The sultans of swing: Turkey's stance on integration with the European Union. OSW Point of View Number 37, November 2013

Despite a rise in anti-EU rhetoric and a growing assertiveness in Ankara’s relations with Brussels, Turkey will continue to seek closer integration with the European Union in the coming years. The current stalemate in the accession process has been a source of irritation to Recep Tayyip Erdoğan’s government. Nonetheless, a complete collapse of accession talks would be a much worse scenario for the ruling AKP party. Currently, the government is primarily interested in keeping the negotiation process alive, rather than hoping to gain full membership any time soon. Erdoğan’s government will likely seek to continue the accession talks because the AKP is acutely aware of their importance for the country’s domestic politics, for its the economy, and – although to a lesser extent – for Turkey’s international standing. The opportunity to capitalise on this process will encourage the Turkish government to avoid crises in its relations with the EU, or to at least mitigate the impact of any potential diplomatic fallouts.

Ever further from Moscow. Russia's stance on Central Asia. OSW Study 48/2014

The post-Soviet countries of Central Asia are important for Moscow as a potential source of danger; as a site of its relationships with China, the West and the Islamic world; and not least as a space covered by Russia’s integration initiatives. Since the collapse of the USSR, Russian influence in this region has undergone a far-reaching erosion. The Kremlin’s consistent actions to build up the Eurasian Union, as well as the threat of destabilisation in region after the ISAF operation in Afghanistan winds up in 2014, have slowed down this process, although it is unlikely to be reversed. The current ‘state of possession’ (i.e. the instruments and assets which Russia possesses) still ensures Moscow a minimum level of control over the region, which means that the activity of other global players is limited. This situation may change in tandem with a rise in their ambitions, especially with the possible involvement of China in the field of ‘hard’ security.

Germany's stance on the TTIP. Background, interests and concerns. OSW Studies 52, March 2015

Co-operation between the United States and Germany has for many years been a subject of disputes. In addition to the differences over the US engagement in the resolution of international conflicts, bilateral relations have been strained as a consequence of the so-called Snowden scandal and the unproved allegations that Chancellor Angela Merkel’s telephone was wiretapped. The Transatlantic Trade and Investment Partnership offers a chance for improving relations between Germany and the USA for the first time in many years. Companies from the two countries may benefit from the lifting of some barriers to transatlantic economic co-operation. Furthermore, the emergence of in fact an internal EU and US market, with reduced customs tariffs and harmonised legal and economic rules, will pressure the emerging economies to make their markets more open. The TTIP may create conditions for exporting US raw materials from unconventional sources to the European Union; and this will be a benefit of geopolitical significance for Germany. The German government is aware of the fact that diversification of supplies of fossil fuels will make Europe less dependent on pressure from Moscow.

My enemy’s enemy–Turkey’s stance on Islamic State. OSW COMMENTARY NUMBER 198/24.02.2016

In the context of the civil war in Syria, Turkey has been accused of intense co-operation with Islamic State. The accusations have been coming for some time from the West, and also from the Turkish opposition and the Kurds. The Russian government has also joined in the accusations over the past few months.

The simple macroeconomics of North and South in EMU. Bruegel Working Paper 2012/12, 30 July 2012

The euro area today consists of a competitive, moderately leveraged North and an uncompetitive, over-indebted South. Its main macroeconomic challenge is to carry out the adjustment required to restore the competitiveness of its southern part and eliminate its excessive public and private debt burden. This paper investigates the relationship between fiscal and competitiveness adjustment in a stylised model with two countries in a monetary union, North and South. To restore competitiveness, South implements a more restrictive fiscal policy than North. We consider two scenarios. In the first, monetary policy aims at keeping inflation constant in the North. The South therefore needs to deflate to regain competitiveness, which worsens the debt dynamics. In the second, monetary policy aims at keeping inflation constant in the monetary union as a whole. This results in more monetary stimulus, inflation in the North is higher, and this in turn helps the debt dynamics in the South. Our main findings are: •The differential fiscal stance between North and South is what determines real exchange rate changes. South therefore needs to tighten more. There is no escape from relative austerity. •If monetary policy aims at keeping inflation stable in the North and the initial debt is above a certain threshold, debt dynamics are perverse: fiscal retrenchment is self-defeating; •If monetary policy targets average inflation instead, which implies higher inflation in the North, the initial debt threshold above which the debt dynamics become perverse is higher. Accepting more inflation at home is therefore a way for the North to contribute to restoring debt sustainability in the South. •Structural reforms in the South improve the debt dynamics if the initial debt is not too high. Again, targeting average inflation rather than inflation in the North helps strengthen the favourable effects of structural reforms.

The euro crisis: ten roots, but fewer solutions. Bruegel Policy Contribution 2012/17, October 2012

Many factors have contributed to the euro crisis. Some have been addressed by policymakers, even if belatedly, and European Union member states have been willing to improve the functioning of the euro area by agreeing to relinquish national sovereignty in some important areas. However, the most pressing issue threatening the integrity, even the existence, of the euro, has not been addressed: the deepening economic contraction in southern euro-area member states. The common interest lies in preserving the integrity of the euro area and in offering these countries improved prospects. Domestic structural reform and appropriate fiscal consolidation, wage increases and slower fiscal consolidation in economically stronger euro-area countries, a weaker euro exchange rate, debt restructuring and an investment programme should be part of the arsenal. In the medium term, more institutional change will be necessary to complement the planned overhaul of the euro area institutional framework. This will include the deployment of a euro-area economic stabilising tool, managing the overall fiscal stance of the euro area, some form of Eurobonds and measures to make euro-area level decision making bodies more effective and democratically legitimate.

Emergent Brazil and the Curse of the ‘Hen’s Flight’. CEPS Working Document No. 379, 27 February 2013

The ‘Emergent Brazil’ growth model is reaching its limits. Its main engines have been slowing significantly since the beginning of the global financial and economic crisis. Even its much-praised predictable macroeconomic policy has been eroded by political interference. Inflationary pressures are growing and GDP performance is anaemic. As ominous, Brazil cannot compensate for its domestic deficiencies with an export drive. Commodity exports are suffering with the world economic slow-down and the manufacturing industries’ competitiveness is in sharp decline. Brazil has put all its trade negotiation eggs into the South American and WTO baskets, and now its export market share is threatened by the Doha Round paralysis, the Latin American Alianza del Pacífico, and the US-led initiatives for a Trans-Pacific Partnership and a trade and investment agreement with the EU. Paradoxically, this alarming situation opens a window of opportunity. There is a mounting national consensus on the need to tackle head-on the country’s and its industries’ lack of competitiveness. That means finding a solution to the much-decried ‘Brazil Cost’ and stimulating private-sector investment. It also entails an aggressive trade-negotiating stance in order to secure better access to foreign markets and to foster more competition in the domestic one. The most promising near-term goal would be the conclusion of the EU–Mercosur trade talks. A scenario to overcome the paralysis of these negotiations could trail two parallel paths: bilateral EU–Brazil agreements on ‘anything but trade’ combined with a sequencing of the EU–Mercosur talks where each member of the South American bloc could adopt faster or slower liberalisation commitments and schedules.

Does the European Semester deliver the right policy advice? Bruegel Policy Contribution 2013/12, 20 September 2013

The July 2013 European Council recommendations to the euro area recognise a number of fiscal and macrostructural challenges, but do not fully exploit the options made possible by the European economic governance framework. There are particular problems with the Council's suggestions for the euro area as whole, which are not (or not adequately) reflected by the country-specific recommendations. A major drawback is that the Council recommendations do not give sufficient importance to symmetric intra-euro area adjustments. Reference to the euro area's ‘aggregate fiscal stance’ is empty rhetoric. Insufficient attention is paid to demand management. The most comprehensive recommendations are made on structural reforms. The July/August 2013 Article IV IMF recommendations on macroeconomic policies could also have been more ambitious, but they correspond better to the economic situation of the euro area than the Council’s recommendations. The President of the Eurogroup should continue discussions on the completion of the economic governance framework, including completion of the banking union and the setting-up of a euro-area institution responsible for managing the euro area’s aggregate fiscal stance.

Have the Germans lost their trust in Europe? CEPS Commentary, 20 September 2013

In the final days before the German federal elections, some observers are asking whether a change in government would portend a shift in the country’s consistently strong support of the euro. Even if a more eurosceptic government is elected to office, this commentary finds it highly unlikely that the German public would radically change its stance.

Subsidiarity between Law and Economics. Research Papers in Law, 1/2005

From the Introduction. The present contribution is an attempt to raise awareness between the 'trenches' by juxtaposing the two approaches to subsidiarity. Subsequently, I shall set out why, in economics, subsidiarity is embraced as a key principle in the design and working of the Union and how a functional subsidiarity test can be derived from this thinking. Throughout the paper, a range of illustrations and examples is provided in an attempt to show the practical applicability of a subsidiarity test. This does not mean, of course, that the application of the test can automatically "solve" all debates on whether subsidiarity is (not) violated. What it does mean, however, is that a careful methodology can be a significant help to e.g. national parliaments and the Brussels circuit, in particular, to discourage careless politicisation as much as possible and to render assessments of subsidiarity comparable throughout the Union. The latter virtue should be of interest to national parliaments in cooperating, within just six weeks, about a common stance in the case of a suspected violation of the principle. The structure of the paper is as follows. Section 2 gives a flavour of very different approaches and appreciation of the subsidiarity principle in European law and in the economics of multi-tier government. Section 3 elaborates on the economics of multi-tier government as a special instance of cost / benefit analysis of (de)centralisation in the three public economic functions of any government system. This culminates in a five-steps subsidiarity test and a brief discussion about its proper and improper application. Section 4 applies the test in a non-technical fashion to a range of issues of the "efficiency function" (i.e. allocation and markets) of the EU. After showing that the functional logic of subsidiarity may require liberalisation to be accompanied by various degrees of centralisation, a number of fairly detailed illustrations of how to deal with subsidiarity in the EU is provided. One illustration is about how the subsidiarity logic is misused by protagonists (labour in the internal market). A slightly different but frequently encountered aspect consists in the refusal to recognize that the EU (that is, some form of centralisation) offers a better solution than 25 national ones. A third range of issues, where the functional logic of subsidiarity could be useful, emerges when the boundaries of national competences are shifting due to more intense cross-border flows and developments. Other subsections are devoted to Union public goods and to the question whether the subsidiarity test might trace instances of EU decentralisation: a partial or complete shift of a policy or regulation to Member States. The paper refrains from an analysis of the application of the subsidiarity test to the other two public functions, namely, equity and macro-economic stabilisation.2 Section 5 argues that the use of a well-developed methodology of a functional subsidiarity test would be most useful for the national parliaments and even more so for their cooperation in case of a suspected violation of subsidiarity. Section 6 concludes.

Saving the Monopsony: Exclusivity, Innovation and Market Power in the Media Sector. Research Papers in Law, 7/2006

From the Introduction. The Media Sector has experienced a technological revolution in the last 15 years. Digital encoding of television signals made possible a more efficient use of the radiospectrum. Digital terrestrial television (hereinafter, “DTT”) allows now for the reception of a significant number of free-to-air channels.1 Moreover, the use of new transmission platforms (hereinafter,“platforms”), namely cable and direct-to-home satellite (hereinafter, “DTH”) paved the way for the arrival in Europe of pay-TV operators, which finance their activities mainly via subscription fees. This changing technological landscape is subject to further evolution in the near future, as incumbent telecommunications operators become increasingly interested in making available broadcasting content2 as part of their broadband offer and 3G mobile handsets can be used for the reception of TV signals....The present paper seeks to ascertain whether the Commission “regulatory approach” towards the exclusive sale of premium content is a sound one, in particular in view of the constant technological evolution outlined above. The assumptions underlying landmark Commission decisions will be compared with recent developments of the media sector in Italy. In the NewsCorp./Telepiù case, decided in 2003, the Commission imposed very strict conditions to allow the merger giving birth to Sky Italia, on the assumption that the operation created a lasting near-monopsony in the different upstream markets for the acquisition of premium intervened against the media conglomerate Mediaset (which controls, inter alia, the main three private free-to-air channels in Italy) for an alleged abuse of dominant position.17 In fact, and contrary to the forecasts made by the Commission, Mediaset was in a position to acquire the broadcasting rights of the main Italian football teams, thereby excluding the incumbent (and near-monopolist) pay-TV operator, Sky Italia. This may go to show that the reality of the sector is more complex and evolves faster than one may infer from the Commission practice, thus putting into question its stance regarding exclusivity. The experience of the evolution of the Italian media sector will be used as the starting point for the evaluation of alternative regulatory options.

Euro-enthusiasm, Euro-rejection, and various shades of grey: The 2014 European Parliament election campaign in the Netherlands. EPIN Commentary No. 18/29 April 2014

With less than a month to go to the European Parliament (EP) elections, campaigning has barely begun in the Netherlands. Whether the campaign will address concrete EU policies or the future of the European Union remains to be seen, but this author argues that the outcomes will probably have less to with the parties’ stance on Europe than with the unpopularity of the incumbent parties and the ‘second order’ character of EP elections.

A European sanctions compensation fund? CEPS Commentary, 12 August 2014

Daniel Gros explores in a new CEPS Commentary the feasibility of creating a common fund to provide compensation for the economic costs of sanctions as an integral part of the EU’s foreign-policy stance that is now emerging towards Russia, albeit slowly and painfully.