Merz Tells EU Leaders to Beware Growing Dangers of a Debt Crisis
German Chancellor Friedrich Merz warned European Union leaders that the mounting debts of governments and companies are fueling the risk of a new financial crisis.
'We must always keep this danger in mind,' Merz said at a press conference in Berlin Friday, following a week of high-level summit meetings. 'We have a record high for state debt, a record high for corporate debt, and a record high for private household debt. None of this is a healthy development.'
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Forbes
2 hours ago
- Forbes
European Parliament Wants To Reduce Cost Of Sustainability Reporting Requirements
People walk by a European Union flag (Photo by) The European Parliament is debating legislation to reduce sustainability reporting requirements in the European Union. The original proposal of the European Commission included a drastic reduction of the scope of a pair of sustainability reporting directives. The member leading the drafting of the Parliament's has released his draft proposal, calling for even more cuts, alarming sustainability activists and emboldening business interests. That proposal was debated in the June 24 meeting of the Committee on Legal Affairs, known as JURI. As part of the European Green Deal, a trilogy of directives were passed by the EU to force businesses to address climate change and report greenhouse gas missions. However, the cost of these proposals on businesses and the broader impact on the EU economy became a theme during the 2024 elections. The shift to the right in EU politics embolden opponents. As a result, the Commission proposed a package of new directives to 'reduce the burden' on businesses. The Omnibus Simplification Package was officially adopted by the Commission in February. The proposal is being debated in the Council and the Parliament. In the Parliament, the debate is public and working through multiple committees, giving interest parties and MEPs the opportunity to voice their opinions. JURI, is the primary committee that will produce the legislation that will be sent to the full Parliament for a vote. MEP Jörgen Warborn, of the European People's Party, has been designated as the rapporteur to lead the drafting of the final legislation. Warborn's draft report was made public on June 6. The draft includes 82 proposed amendments. During the June 24 JURI meeting, the Committee addressed the proposed amendments. Warburn was given the opportunity to share his initial proposal and the shadow rapporteurs gave initial comments. Jörgen Warborn Warburn stated the EPP's goal in the proposal. 'We would like to go further in cutting costs, because we need to strengthen European competitiveness in order to create long-term prosperity for European citizens.' To justify the need for cuts, he stated "sustainability rests on three pillars: the environmental pillar, the social pillar, and the economic pillar… if one breaks, the stretcher collapses." He then outlined his 10 key priorities in the proposal: MEP Lara Wolters, Group of the Progressive Alliance of Socialists and Democrats Lara Wolters, of the Group of the Progressive Alliance of Socialists and Democrats (S&D), stated her group felt the 'Commission proposal was extremely rushed and deeply flawed.' She says that the proposal is not focused on removing the administrative burden, rather on removing accountability. She did not get into the specifics of the S&D proposal, but gave a vigorous counterargument to reductions. Countering the EPP's push to lower costs on businesses, she stated that she 'is not inspired by this… It is our job to weigh public versus private interests. But if costs are all the EPP cares about at the moment, then at least let us be honest that the costs are merely being displaced. Costs reduced for companies here are costs that the world will need to shoulder anyway. Climate denial comes at a cost. So does environmental degradation, exploitation, and inequality. So does feeding populism.' MEP Pascal Canfin, The Renew Group Pascal Canfin, of the Renew Europe Group, stated that he agrees with the EPP on the auditing of the CSRD report. He believes there is room to negotiation on that topic and reduce cost beyond the Commission proposal. He stated that he agrees in cost reduction, but that the EPP proposal does not deliver that. Focusing on capital market union, he said investors need data. The reduction in of the CSRD may save costs on paper, but will increase costs in the long term as investors spend more to gather the data. He will be offering amendments to address those concerns. Renew will also present amendments to address the single market approach and what he views as conflict with the restriction on civil liability causing market fragmentation. He also took issue with the application of the 3000 employee threshold to non-EU companies, claiming that would exempt nearly all non-EU companies from the scope. Interestingly, he stated the calculation of the employee count for non-EU companies is not based on total employees in the EU, rather total employees in a member state. MEP Kira Marie Peter-Hansen, Group of the Greens/ European Free Alliance (EFA) Kira Peter-Hansen, of the Group of the Greens/ European Free Alliance (EFA), stated that they agree with simplification and "reporting must be both meaningful and manageable.' However, she agrees with the S&D that the Omnibus and the EPP proposals go beyond simplification into deregulation. She pointed out that the raised thresholds not only eliminate 80% of the companies, but also some member states as they do not have any companies large enough to comply. She encouraged the use of the EFRAG data to simplify the data points in the European Sustainability Reporting Standards to simplify reporting requirements without 'weakening impact.' She accused the EPP of 'choosing populistic, symbolic changes over actual needed changes that would benefit from a revision." Further, she stated that 'removing climate transition plans completely is not just wrong, it is irresponsible.' She encouraged the adoption of a risk-based approach over the Commission proposal of mapping the value chain, claiming it would increase costs for companies. Finally, she objected to the removal of civil liability in the CSDDD. MEP Arash Saeidi, The Left Group Arash Saeidi, of The Left, opened by stated that 'there are men, women, and children whose rights are being breached and they're just being seen as cogs in the wheel of a production - modern slavery, textiles workers, forced labor to produce our electronics.. workers killed on sites. The CSDDD is designed to put an end to impunity and finally holding companies legally accountable from environmental damage and infringement of human rights.' He stated that The Left will present a proposal to reject all the proposed changes and stay with the existing text in the CSRD and CSDDD. Political parties and MEP had until June 27 to submit amendments. On July 15, the shadow rapporteurs will meet to discus the amendments and begin negotiations. To pass, the proposal needs majority support. Committee opinions are being drafted by Economic and Monetary Affairs, known as ECON, Environment, Climate and Food Safety, known as ENVI, Foreign Affairs, known as AFET, International Trade, known as INTA, and Employment and Social Affairs, known as EMPL. Those will be sent to JURI for consideration. I suspect Warborn's proposal is a negotiation tactic. By promoting a position that is more extreme than the original Commission proposal, the EPP has room to negotiate. However, the recent proposal by the Council was also to the right of the Commission. The final Parliament proposal may end up being the middle ground. JURI is expected to adopt the final language to reduce the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive on October 13. Following the vote of the Parliament, designated representatives from the Parliament, Council, and Commission will enter into "trilogue" negotiations. The proposals from each of the three bodies will vary. The trilogue will negotiate the differences to produce a final directive. That directive will be sent to the Council and Parliament for a final vote in December or January.
Yahoo
4 hours ago
- Yahoo
Sky retreats from Germany after losing billions
Sky has made a costly retreat from Germany 15 years after Rupert Murdoch broke into the market with hopes of building a pan-European pay-TV empire. The German broadcaster RTL has acquired Sky Deutschland for just €150m (£128m). The figure represents a collapse in the value assigned to the business in 2018 when Sky was acquired for £30bn by the US cable giant Comcast in a blockbuster auction. At that time Brian Roberts, Comcast's executive chairman and controlling shareholder, said Sky's continental footprint would provide crucial scale. The takeover of Sky would help Comcast compete in the increasingly global entertainment business against the likes of Netflix and Amazon, investors were told. However, it quickly proved that Mr Murdoch had sold up at the peak of pay-TV in Europe, as streaming began to make growth much more challenging. The difficulties that Sky had experienced in making Sky Deutschland profitable would not be easily solved under new ownership. The decision to sell Sky Deutschland at a heavy loss will be received as further recognition by Comcast that it overpaid for Sky. Sky acquired full control of Sky Deutschland in 2014 in a deal that valued the German operation at more than £4.4bn. It said on Friday that if RTL is able to hit profit targets it is in line to receive an additional €377m on top of the €150m cash up front. Sky Deutschland has never made a profit, operating in a market of famously thrifty consumers. However, following determined cost-cutting under Comcast it is expected to break even this year. The sale comes after repeated attempts by Comcast to exit Germany, which never achieved the scale of even Sky's tricky Italian business. Talks last year were overshadowed by uncertainty over Sky Deutschland's crucial top-flight football rights. They were secured in December, giving new impetus to the discussions. The agreement marks Mr Roberts' most drastic move yet in its battle to make his takeover of Sky more palatable for Wall Street, which has never shown enthusiasm for his European empire-building. Comcast already reduced the value of Sky by $8.6bn (£6.3bn) in 2022 and stopped breaking out its performance in financial reports. Last year, it also reported a £1.2bn write-down on loans to its German and Italian operations, which were bought by Sky in a £7bn deal in 2014. Struggles in Europe have prompted further cost-cutting efforts at Sky, which recorded a pre-tax loss of £773m in 2023, according to its latest accounts. Plans to cut 2,000 customer service roles were announced in March. However, as well as securing the sale of Germany, Sky has delivered apparent progress in Italy. Revenues there were up 8.2pc last year to €2.4bn and it swung from a loss to underlying earnings of €177m. Thomas Rabe, the chief executive of RTL, said the deal would 'bring together two of the most powerful entertainment and sports brands in Europe, and create a unique video proposition across free TV, pay-TV and streaming'. The German division, which operates in Germany, Austria, Switzerland and parts of Italy, holds the rights to broadcast the Bundesliga, the German football league, until 2029. Francois Godard, an analyst at Enders Analysis, said Sky had struggled in Germany with market share languishing around 10pc. Mr Godard said that earlier valuations of Sky Deutschland had been based on 'magic growth ... Of course, that did not happen'. He added: 'Germany has always been different from the UK. They never reached the kind of penetration they had in the UK.' Meanwhile, Sky's attempted overhaul was dealt a blow last year after bosses discovered an embarrassing advertising blunder. This stemmed from Sky uncovering miscalculations in its ad sales that meant its partners did not receive the correct revenues from their deals dating back years. Like other broadcasters, Sky has also been navigating a shift from linear TV to streaming, as customers switch from expensive satellite TV packages to on-demand streaming apps. Next year, it will face further competition as HBO launches its Max streaming service. In December, Sky secured a deal to keep HBO's shows, such as a new Harry Potter series, bundled with its service, but they will no longer be exclusive to the UK broadcaster. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 hours ago
- Yahoo
Trump says he is cutting off trade talks with Canada
US President Donald Trump has said he is cutting off trade talks with Canada "immediately" as the country looks to start enforcing a tax policy targeting big tech companies. The latest move, which he announced on social media, comes as the neighbouring nations had been working to agree a trade deal by mid-July. Both countries have imposed tariffs on each other's goods after Trump sparked a trade war earlier this year and threatened to annex Canada using "economic force". On Friday, the US president said he was ending talks due to what he called an "egregious tax" on tech companies and added he would announce new tariffs on goods crossing the border within the next week. "We are hereby terminating ALL discussions on Trade with Canada, effective immediately," he wrote on social media. "We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period." Canada's 3% digital services tax has been a sticking point in its relationship with the US since the law was enacted last year. The first payments are due on Monday. The Canadian finance minister, whose office confirmed the country would move forward with the tax, did not immediately respond to requests for comment from the BBC. Business groups estimate it will cost American companies more than $2bn a year. Canadian officials have said they expected to address the issue as part of trade talks with the US. There were hopes that the relatively warm relationship that newly-elected Prime Minister Mark Carney has forged with Trump might help those negotiations. The president's latest move casts doubt on a future deal, though Trump has often used social media threats to try to gain leverage in talks or speed up negotiations he sees as stalling. Last month, for example, he threatened to ramp up tariffs on goods arriving to US shores from the European Union, only to climb down a few days later. Canada will deal with Trump 'on our terms', Carney tells BBC The US is Canada's top trade partner, buying more than $400bn in goods last year under a longstanding free trade agreement. But Trump hit that trade with a new 25% tariff earlier this year, citing concerns about drug trafficking at the border. New US tariffs on cars, steel and aluminium have also scrambled relations. Car parts, for example, cross US, Mexican and Canadian borders multiple times before a vehicle is completely assembled and such import taxes threaten supply chains. Trump later carved out exemptions for some goods in the face of widespread alarm from businesses in both the US and Canada, which has hit back with tariffs of its own on some US products. Shares in the US fell on Friday after Trump said he was cutting off talks.
