Wednesday, October 2, 2024

Brussels Edition: 'The EU could die'

Emmanuel Macron had a stark warning for a Europe he said is over-regulating and under-investing

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

Emmanuel Macron issued a stark warning yesterday for a Europe he said is over-regulating and under-investing: "The EU could die." Speaking on a panel with Bloomberg's Stephanie Flanders, the French president went on to add that if the bloc continues to follow its "classical agenda," it will be "out of the market" in two or three years. He also called on member states to rally behind cross-border mergers to create companies that can compete with US firms — a pointed message given Germany's angst over Commerzbank. As he faces his own domestic fiscal pressures, Macron endorsed a temporary tax  on France's largest companies, supporting his new government's strategy even as it marks a shift from his pro-business stance. Read why Macron thinks he can still get his policies through a divided parliament.

Kevin Whitelaw

What's Happening

Green Delay | The EU had set an ambitious plan to reverse the destruction of millions of hectares of forests every year, but the timetable proved too aggressive for much of the world, which wasn't ready to sign onto the bloc's targets. That's why the European Commission caved yesterday to pressure from countries including Brazil and the US to slow down.

After Brexit | Keir Starmer promised to "stand firm" during what are likely to be tough talks to forge closer ties with the EU, as he and Commission President Ursula von der Leyen announced the first-ever UK-EU bilateral summit next year. Starmer ruled out returning to the customs union or the single market, but said he'd find "constructive ways to work together."

Stalled Talks | Olaf Scholz made a fresh appeal for a swift conclusion to talks on a major trade agreement between the EU and four South American economies that France opposes. The German chancellor met Macron yesterday, but the French leader later said the proposed deal would put EU companies and farmers at a disadvantage.

Missile Sleuths | Just over a year ago, a six-year-old Ukrainian girl was killed near a town square in the northern city of Chernihiv by a missile fired by Russian forces. A Ukrainian investigator examined the module from the Iskander's SN-99 missile's navigation system and found it contained components made by four Western companies. Read more about Bloomberg's forensic look into Russia's missile technology.

Seeing Value | A growing number of German experts are voicing support for a possible outside acquisition of Commerzbank, potentially increasing pressure on the government to soften its stance over a recent approach from UniCredit. The head of the Italian lender has said his pursuit of Commerzbank is a test case for the EU's banking-union ambitions.

Around Europe

Forging Ahead | A Swedish textile-recycling startup that shares roots with struggling Northvolt says it's plowing ahead with the similar challenge of taking on an entrenched Chinese industry. Like EV battery maker Northvolt, Syre plans to ramp up rapidly — the manufacturing firm wants to build 12 recycling plants over the next decade.

Dissident Killed | An outspoken critic of Azerbaijan's President Ilham Aliyev has died following an attack in France by three unidentified assailants. Vidadi Isgandarli perished in a hospital two days after masked attackers broke into his home and stabbed him in the eastern city of Mulhouse.

Losing Control | Spain's Grifols made a fateful decision to list its shares in 2006 to build up more capital. Now, after a sustained attack by a short seller that exacerbated shoddy governance and a lack of transparency, it's likely to cost the founder's descendants control of the 80-year-old drugmaker.

No Greenwashing | MSC Cruises was told to drop some green claims in its advertisements in the Netherlands after Dutch environmental campaigners complained that its ads amount to greenwashing. It will be restricted from saying passengers can "cruise responsibly or green with" the company, or that liquefied natural gas is a clean shipping fuel.

Chart of the Day

France plans around €60 billion in spending cuts and tax hikes next year as Prime Minister Michel Barnier seeks to claw back a widening budget deficit and bolster investor confidence. The savings are required to bring the budget shortfall to 5% of economic output from around 6.1% this year, according to government officials.

Today's Agenda

All times CET

  • Commission President Ursula von der Leyen receives the CEOs of several leading European innovation and startup hubs
  • EU foreign affairs chief Josep Borrell attends the Foro La Toja-Vínculo Atlántico in La Toja, Spain

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