Weekly brief

European Central Bank President Mario Draghi elaborated on Thursday, September 6, long-anticipated plans to purchase Spanish and Italian bonds, indicating that the European Union’s central bank would purchase an unlimited number of bonds with a term up to three years to provide funding for the two struggling nations, whose debt woes have added to fears of an ever-deepening, continent-wide debt crisis, Le Figaro and Les Echos  reported. Spanish and Italian ten-year bonds, which had reached a record 7.6 and 6.6 percent yield rate, dropped to 5.7 and 5.1 percent the following day.  International Monetary Fund Managing Director Christine Lagarde announced on Sunday, September 9, that the IMF supported the move, declared that both nations had taken proper steps to merit aid from the eurozone and added that the IMF would be willing to serve in a supervisory capacity, according to The New York Times and Reuters.

As France, Europe and global markets anticipate France’s 2013 budget to be released on September 28, President François Hollande said on Friday, September 7, that he intended to move forward with a series of spending cuts and tax reforms, including a controversial 75-percent tax on those earning more than €1 million per year, The Chicago Tribune reported. On Sunday, September 9, Hollande spoke again, saying he intended to accelerate proposed reforms amid pressure from an increasingly impatient nation and clarifying that there would be no exception to the 75-percent wealth tax, as many had speculated, as covered by CNN, The Wall Street Journal and 20 Minutes. The nation’s leading tax union released a report the same day indicating that of 36 million households, the 20 million lowest-income households would not be affected by Hollande’s proposed tax hikes, according to Le Monde. In Hollande’s Sunday-evening television appearance, he said he was readying labor-market reform to be presented by year end and intended to put the nation’s stagnant economy on track within two years, according to CNBC. The Bank of France released statements the following day, Monday, September 10, predicting that the French economy would retract 0.1 percent in the third quarter of the year after stagnating at zero-growth for two straight quarters, according to The Economic Times.

Billionaire Bernard Arnault, CEO of luxury conglomerate LVMH and the richest man in France, fueled the already heated debate over President François Hollande’s proposed 75-percent income tax for the nation’s wealthiest citizens when he announced on Saturday, September 8, that he had applied for Belgian citizenship, citing personal and business reasons, Reuters and The Week reported. Arnault denied speculation that his application for Belgian citizenship was an attempt to avoid the tax or his fiscal obligations in France, emphasizing that he remained committed to paying taxes and creating jobs in France, but that he had started the process before Hollande’s election, according to Le Nouvel Observateur and Le Monde. Nonetheless, Hollande and fellow politicians on both sides brought into question Arnault’s patriotism, while certain media outlets had harsher words. Libération, for example, ran a headline telling the billionaire, “Get lost, you rich idiot” (casse-toi riche con!), as covered by Bloomberg and France 24.

The United Nations High Commissioner for Human Rights outlined the top priorities for human rights worldwide on Monday, September 10, in a report that warned not only against the mass violence in Syria but also against the expulsion of Roma people in France, The Washington Post, Libération and Deutsche Welle reported. As evictions of Roma camps across France have continued the controversial policy implemented under former President Nicolas Sarkozy, the UN watchdog echoed warnings to the new French government it had issued in 2010. The New York Times looked at a series of expulsions and razings of Roma camps in Paris, Lyon and Lille this past summer.

Faced with the budgetary constraints of the nation, Culture Minister Aurélie Filippetti announced on Tuesday, September 4, that the government was suspending a number of cultural projects as the minister seeks to reduce government spending on culture by three percent in the coming year, Le Parisien and Libération reported. Included in the cuts were a number of projects proposed by the government of former President Nicolas Sarkozy, including a controversial Maison de l’Histoire de France, as covered by Rue 89, Art Info and Le Figaro.  

Greek  Prime Minister Antonis Samaras resumed talks with the Troika - inspectors from the European Commission, the European Central Bank and the International Monetary Fund, on Sunday, September 9, as the supervisors did not approve a portion of that government’s proposed budget plan, Boursorama and Reuters reported. As talks continued on Monday, September 9, Greek officials acknowledged that of the €11.5 billion in budget cuts required for future international aid, about €2.5 to €3 billion euros remained to be confirmed, according to L’Express.

More than four years after declaring independence from Serbia in 2008, the Republic of Kosovo obtained a new era of sovereignty as a 25-nation group formally ended a period of supervision of the new republic, Le Monde and The Washington Post reported. As the European nation continues its administrative fight for independence, this most recent step has been accompanied by struggles, such as a lack of official recognition by the European Union and an outright denial of recognition by Serbia, as well as Russia and its allies, as covered by Libération and Deutsche Welle.