Spanish-French love-in — Lindner’s debt problem — Putin’s blood diamonds – POLITICO

By Corruption Buzz On Jan 19, 2023

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DRIVING THE DAY: SPANISH-FRENCH TEAM-UP

MACRON AND SÁNCHEZ SEAL BARCELONA TREATY: French President Emmanuel Macron, Spanish PM Pedro Sánchez and their governments and ministers are in Barcelona this morning to sign a historic “friendship and cooperation” treaty, equal in scope and ambition to the Franco-German Treaty of Aachen, officials tell Playbook.

Details: In their friendship treaty, set out over 10 chapters, France and Spain vow to reinforce ties on everything from education to economics. Crucially, the governments agree to meet and consult regularly and vow to team up on international and European questions — the goal is to “perfectly coordinate our positions,” as the Elysée puts it. The leaders will also sign a treaty on defense cooperation, replacing the old one from 1983.

Tongue tied: They will also seek to boost teaching of each others’ languages. Currently, Spanish is the second-most-studied language in France after English, and vice-versa.

Significance: For Sánchez, the deal means joining the ranks of Germany and Italy, the only other two countries that have such a treaty with France. Macron, meanwhile, strengthens France’s pivotal role in Europe. Plus, Paris will now have ambitious bilateral treaties with its three main neighbors.

Chemin Franco-Espagnol: Last year, Playbook embarked on a history trip down King Philip II’s Camino Español — the Spanish road that circumvented France to link the Iberian Peninsula and Central Europe. But Macron made clear he was not willing to repeat the past, announcing instead the construction of a new hydrogen pipeline connection from Barcelona to Marseille. So it’s no coincidence that today’s summit is in Barcelona rather than in the Spanish or French capitals.

Symbolism isn’t lost on Paris: The Elysée acknowledged the historic parallels, saying in a note to journalists that the new treaty “should enable us to map out a ‘Franco-Spanish road.’” The message is clear: France will not be circumvented; instead both nations with strengthen ties.

Consequence: Germany, France, Italy and Spain are the EU’s biggest economies and most populous countries. And France, in the middle, is no longer just the geographical but also the political link between all of them.

End of the road for separatists? The choice of location has an added layer of significance for Spain. Barcelona, the city where five years ago organizers of a so-called referendum made a failed separatist declaration, is no longer in the freezer. The politicians who organized the campaign — a movement known under its Catalán name of “procés” — have been pardoned. Madrid argues its recent reforms to the penal code and pardons for the sentenced politicians have helped normalize the relationship with Catalonia. “The procés has ended,” Sánchez said last month.

What to watch for: Spain and France are expected to team up on an EU electricity market reform proposal, on economic governance, agriculture, connections for gas, electricity and rail and on the bloc’s migration and asylum pact. They will also work together on “freedom of access to common spaces” — including freedom of navigation.

PARLIAMENT IN FOCUS

METSOLA’S UNDECLARED GIFTS SUDDENLY APPEAR ON REGISTER: European Parliament President Roberta Metsola has retroactively declared more than 140 gifts in the past days, which she had previously failed to disclose. The haul includes gold coins, scarves and a “dried sausage.”

Too little, too late: The move again lays bare the problems with transparency rules that rely on self-enforcement. Metsola, a Maltese MEP from the center-right European People’s Party group, entered the gifts she received in an official public record that lawmakers rarely update. In doing so last week, however, she missed the deadline for MEPs to declare their gifts in relation to 125 of the items on her list. Read more by Eddy Wax.

S&D APPOINTS INTERNAL INQUIRY LEADERS: Richard Corbett — a former leader of the European Parliamentary Labour Party — and Silvina Bacigalupo, a professor of criminal law and president of Transparency International Spain, will lead the inquiry, S&D officials told Playbook.

Tarabella kicked out: Marc Tarabella and Andrea Cozzolino, the two S&D MEPs who face losing their legal immunity amid Qatargate, have been excluded from the group for the duration of the criminal investigation, as Monday’s Playbook previewed. Cozzolino stood down after being asked to by the group, but Tarabella had to be pushed out. They will soon be listed as non-attached MEPs.

Meanwhile, Panzeri’s accountant has been arrested in Italy.

FOREIGN INTERFERENCE PANEL COULD BE REVAMPED: Top Parliament officials are looking into repurposing a panel on foreign interference in EU democracy to serve as a dedicated post-Qatargate committee, Eddy also reports. A majority of MEPs called for a dedicated committee to be set up in December — and while groups like the Greens, the Left and far-right Identity and Democracy still want this, repurposing a special committee that’s already up and running might be faster.

Fly on the wall: This was discussed at a closed-door meeting of heads of the political groups in Strasbourg Wednesday, according to two people in the room. It will look at issues that aren’t in the 14 immediate quick-fixes proposed by Metsola, such as giving whistle-blower protections to parliamentary assistants.

What’s in a name? Known as INGE in parliamentary slang, the panel is led by S&D lawmaker Raphaël Glucksmann and is in its second iteration. The group leaders on Wednesday also agreed to prolong INGE’s mandate for three more months. Whether the members or leadership of the committee changes is still TBC, but it could be requested to report back with recommendations by the summer. The INGE name could also be changed to add terms like transparency, integrity and corruption — it’s clear the Parliament is not only looking at Qatargate as a matter of foreign interference but also one stemming from internal dysfunction and timid rule enforcement.

PARLIAMENT CALLS FOR ‘INVESTIGATION’ INTO ENLARGEMENT COMMISSIONER: MEPs are calling on Commission chief Ursula von der Leyen to launch an “independent and impartial investigation” into her Hungarian Commissioner Olivér Várhelyi, over his reported support for Serbian nationalists.

In a plenary vote on Wednesday, Parliament adopted a resolution urging the Commission to investigate “whether the conduct engaged in and policies furthered by the Commissioner for Neighbourhood and Enlargement constitute a breach of the Code of Conduct for the Members of the Commission and of the Commissioner’s obligations.” (Background reading on Europe’s under-fire gatekeeper here.)

RUSSIA’S WAR

EU TALKS ON MORE SANCTIONS THIS WEEKEND: The European Commission is expected to hold so-called confessionals with EU ambassadors over the weekend to prepare the 10th sanctions package against Russia, five EU diplomats told POLITICO. Brussels will present its ideas for new sanctions and feel out ambassadors’ red lines — before making a formal public Commission proposal to EU countries. The upcoming anniversary of the invasion on February 24 — and fears of a new offensive — have led to renewed calls to intensify sanctions against Russia.

Meanwhile, Budapest throws a spanner in the rollover: Hungary has requested nine names be taken off a list of those already sanctioned. Those individual sanctions must regularly be prolonged, and the extension requires the unanimous approval of all EU countries — usually a formality.

Warsaw rift widens: During a meeting of EU ambassadors on Wednesday, Poland protested against Hungary’s request for the de-listings, two diplomats told us. Warsaw’s representative submitted a formal protest with the support of the Baltics, said one. Yet, according to a third diplomat, none of this means Hungary will try to block the 10th package of sanctions.

DIAMONDS IN THE ROUGH: The European Commission and Belgium are working on a system so that Russian diamonds can be traced and identified as “blood diamonds,” reports De Morgen. Russian diamonds have been a sore point when it comes to the EU’s sanctions packages — they’ve been excluded in large part due to Belgium’s resistance. Antwerp is the main hub for diamonds arriving in Europe, including from Russia.

COMMISSION VP JOUROVÁ PITCHES ‘RADIO FREE RUSSIA’: Europe should take the information fight to Russia, Commission Vice President for Values Věra Jourová told Playbook in an interview at the World Economic Forum in Davos. EU efforts had been effective in combating Russian disinformation, “but besides this defensive position, I think that we should think about whether we could not do something to deliver the information to the Russians.”

Reaching the doubters: “I’m not naive. I think that a big part of the society doesn’t even want to hear anything from anyone else than from the czar in the Kremlin. Let’s face the reality,” said the Czech commissioner. “But I believe there are a lot of people living in Russia, who at least doubt whether their regime is fair, whether the war was necessary, whether they are doing the right thing, whether they are obliged to go to die to the war.”

EU financing: The idea, Jourová said, is to bring together and support independent European media that provides content in Russian, to allow the information to reach into the increasingly isolated country. Asked whether the Commission would help finance the endeavor, Jourová said: “I will do my best to find some money.”

So would this be something akin to Radio Free Europe during the Cold War? “I am more thinking about Radio Free Russia,” Jourová said. “I also work on the basis of my memories from my childhood,” she said. “The Voice of America and Radio Free Europe, Radio Liberty — they helped us in communist Czechoslovakia to understand what’s happening. We were listening every evening. So maybe there might be many Russians who would appreciate getting some objective news.”

… ON CONFISCATING RUSSIA’S CENTRAL BANK MONEY: Jourová said Brussels was looking into legal pathways to confiscate and use the frozen reserves from Russia’s central bank — which are believed to amount to up to €300 billion in total, including assets frozen by the U.S. and allies. “There might be a way which will be compliant with the international rules. And we have to discuss that also with the Ukrainian partners,” Jourová said, arguing the issue was important for a “sense of general justice, those who are causing the destruction have to pay.”

SCHOLZ SHTUM ON TANKS: Meanwhile, Chancellor Olaf Scholz revealed little about Germany’s next steps when it comes to sending tanks to Ukraine during his appearance on the WEF stage. Instead, he highlighted the fact that Germany spent €12 billion helping Kyiv last year and would continue to support Ukraine “as long as necessary.” More here. Meanwhile, Reuters reports this morning that Germany has indicated it will send its tanks to Ukraine as long as the U.S. does too, citing a government source.

NOW READ THIS — DAVOS STRUGGLES TO GET USED TO A WORLD WITHOUT RUSSIA: Erin Banco surveys the oligarch-free scene. More from the WEF in our Davos Confidential podcast.

MOVING IN ON RUSSIA’S TURF: As Russia falters in Ukraine, the EU’s new Armenia monitoring mission is moving in to help in a region where Moscow once called the shots, reports Gabriel Gavin.

IN OTHER NEWS

WHILE YOU WERE SLEEPING — ARDERN OUT: New Zealand’s Jacinda Ardern is quitting as prime minister. She announced to a bewildered annual meeting of her Labour Party that she no longer has “enough in the tank” to do the job justice and will step down next month. Write-up from POLITICO here.

STRIKES HIT FRANCE: France is bracing for severe disruption today as trade unions and opposition parties vow to force the government to abandon Emmanuel Macron’s flagship pensions reform. Schools, universities and public administrations are expected to close, public transport will be severely affected and demonstrations are planned in major cities across the country. Clea Caulcutt has more on Macron’s day of reckoning.

Hot take: POLITICO’s Paul Taylor sets out why he thinks Macron must win his pension reform battle.

A BANK LOAN BECOMES A PROBLEM FOR GERMANY’S LINDNER: German Finance Minister Christian Lindner likes to insist on fiscal discipline for EU countries and is against taking on new debt. But a big loan Lindner took out to purchase a home is now becoming a problem for him.

What’s a million between friends? Spiegel reports BBBank — for which Lindner made several videos and appeared at exclusive events — financed a loan for his house at an above-market price. Spiegel obtained a property valuation that an expert wrote for the bank a week before Lindner’s purchase in 2021. The valuation was for €1.34 million, but a mortgage of €2.35 million was registered. Then, in June last year, the bank increased the mortgage by another €450,000 — to a total of €2.8 million.

Prosecutor on it: “Lindner’s questionable real estate financing is now being investigated by the Berlin General Prosecutor’s office, which is examining a possible initial suspicion of accepting undue benefits,” Spiegel writes. “Among other things, this concerns an official video greeting that Lindner recorded in May 2022 as Federal Minister of Finance for an internal anniversary celebration for the 100th anniversary of BBBank — a few weeks before his private loan was increased to €2.8 million.”

MEANWHILE, IN IRELAND: A failure to report election expenses worth less than €5,000 is putting the heat on Ireland’s finance whiz Paschal Donohoe, the Eurogroup president, reports Shawn Pogatchnik.

GENTILONI WANTS COMMON FINANCING FOR INDUSTRY FUND: Economy Commissioner Paolo Gentiloni is pushing for “common financing” to build a fund that allows all EU countries to match America’s industrial subsidies. In an interview on the sidelines of the World Economic Forum in Davos, Gentiloni said a fund was needed to preserve the “scale” of the single market. “Nobody can deny, I think, the need of a common response.” The former Italian PM also warned that Brussels should not give EU countries a blank check to subsidize industries at will but should stick to “limited intervention.”

UN WORRIES ABOUT COP28 TEAM’S TIES WITH OIL GIANT: The U.N. is querying the presidency of this year’s COP28 climate talks over its ties to state-owned Abu Dhabi National Oil Company (ADNOC), a person with knowledge of the matter told POLITICO. Worries emerged as the COP28 presidency team is currently working from ADNOC’s headquarters in Abu Dhabi.

Odd job: The appointment last week of ADNOC’s Chief Executive Officer Sultan Ahmed Al Jaber had already unleashed an intense backlash from climate campaigners across the globe, who said it amounted to “putting the head of a tobacco company in charge of negotiating an anti-smoking treaty.” More from my colleagues Federica, Karl and Gian Volpicelli here.

AGENDA

— NATO’s Military Committee continues meeting in Brussels from 8:30 a.m. Press conference at 3 p.m. Watch.

— European Parliament plenary session concludes in Strasbourg. Program.

— World Economic Forum continues in Davos. “Finding Europe’s New Growth” featuring Prime Minister of the Netherlands Mark Rutte, European Central Bank President Christine Lagarde, European Commission Vice President and Trade Commissioner Valdis Dombrovskis, Christian Sewing, chief executive of Deutsche Bank and Croatian Prime Minister Andrej Plenković at 11.30 a.m. … European Parliament President Roberta Metsola participates on panel discussion “Widening Europe’s Horizons” at 4:15 p.m. … Trade Commissioner Valdis Dombrovskis holds press conference on the launch of the coalition of trade ministers on climate at 5:15 p.m. (watch).

— European Commission President Ursula von der Leyen receives Prime Minister of Portugal António Costa at 7 p.m.

— Press point by Home Affairs Commissioner Ylva Johansson and new Frontex chief Hans Leijtens at 11:30 a.m. Watch.

— The EU High Representative for Foreign Affairs Josep Borrell delivers a speech in Madrid at the event “A new world order: politics, economics and global affairs as tools to confront today’s challenges.”

— Commissioner for Competition Margrethe Vestager meets former Prime Minister of Sweden Stefan Löfven; meets Greek Finance Minister Christos Staikouras.

— Commission Vice President Frans Timmermans attends the Brussels Motor Show; receives Minister of Energy and Transport of Luxembourg Claude Turmes.

BRUSSELS CORNER

SUPERMARKETS ON STRIKE: Staff at five branches of Intermarché (previously Carrefour) are on strike over language issues and takeover tensions. The stores at Uccle, Forest, Schaerbeek, Molenbeek, and Jette are currently affected, and according to the Central National Employees union, others may follow. The Brussels Times has more.

ANGEL IN AS THE CENTER FOLDS: Marc Angel, a Luxembourg Socialist, was elected Wednesday to replace Eva Kaili as a European Parliament vice president following the Greek lawmaker’s arrest in the Qatargate corruption probe.

BIRTHDAYS: MEP Guido Reil; Former MEPs Evelyne Gebhardt and Svetoslav Malinov; Reuters’ Giulia Paravicini; Italy’s former Finance Minister Pier Carlo Padoan; U.S. diplomat Philip Reeker; U.S. Secretary of Transportation Pete Buttigieg.

PLAYBOOK COULDN’T HAPPEN WITHOUT … Playbook reporter Ketrin Jochecová and producer Grace Stranger.

THANKS ALSO TO: Eddy Wax, Nektaria Stamouli.

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