Germany is to take the radical step of changing its constitution in order to ensure excessive public borrowing is prevented, the country's chancellor, Angela Merkel, announced on Tuesday (13 January).

The country is also to impose strict new rules to ensure that the extra debt created by its latest stimulus plan is paid off quickly.

Germany is to boost public spending but wants to contain borrowing at the same time

Ms Merkel made the comments while unveiling a second stimulus plan worth €49.25 billion, to be spent over two years and made up of public investments and tax cuts.

The constitutional amendment would prevent German governments from raising the state's public deficit above 0.5 per cent of GDP "in normal economic times", the Financial Times reports.

This would have capped 2008 borrowing at €12 billion.

The EU's Stability and Growth Pact, which limits Eurozone budget deficits to three per cent of GDP, was relaxed last year as the economic downturn escalated.

David Cameron, the leader of the opposition Conservative party in Britain, has pledged to hold a referendum on the EU's Lisbon treaty if his party is elected later this year.

Mr Cameron told the Financial Times newspaper that he believes that the Labour government under Prime Minister Gordon Brown may hold an election in 2009, possibly as early as April.

The British parliament has already ratified the treaty

Under this scenario "we could have a referendum in October," the Conservative politician said.

An early election by Mr Brown - the last date by which the government has to call an election is June 2010 - would hand the Conservatives an opportunity to derail the EU's latest treaty, although it has already been ratified by British Parliament and approved by the queen.

Britain's Conservative Party, which is generally eurosceptic, is a strong opponent of Lisbon and has long campaigned to hold a referendum on the document.

A public poll would expose Britain's ambivalent relationship with Europe and has a major chance of resulting in a No vote.

EUOBSERVER / BRUSSELS - Czech Prime Minister Mirek Topolanek has trampled on the EU's unspoken rule that presidency countries do not offer a controversial opinion on the sensitive topic of the moment.

Speaking to MEPs in Strasbourg on Wednesday (14 January), Mr Topolanek, in charge of the EU for the first half of this year, offered only half-hearted support for the EU's new rulebook - seven years in the making and facing an uncertain future - and expressed doubts that Czech citizens would approve it in a referendum.

Prague - the Czech capital will be working closely with Dublin on the Lisbon treaty

"It's an average treaty, a bit better than the [current] Nice treaty," he said and expressed annoyance about the pressure on member states to ratify the Lisbon treaty.

"Telling member states in advance that they have to ratify the treaty and ...that they do not have the right ...to decide whether to approve it or not is absurd," Mr Topolanek said, according to AFP news agency.

SOFIA, Bulgaria: Hundreds of protesters clashed with the police, smashed windows and damaged cars in the Bulgarian capital Wednesday when a rally against corruption and slow reforms in the face of economic crisis turned into a riot.

The violence broke out during a peaceful protest in front of Parliament of more than 2,000 people, including students, farmers and green activists, who said they were fed up with life in the European Union's poorest and most corrupt nation.

The riot in Sofia was the worst since 1997, when mass rallies and strikes toppled the then Socialist government for pushing the Balkan country into an economic meltdown. Organizers plan more protests in Sofia on Thursday.

On Wednesday, protesters demanded that the Socialist-led government step down for its failure to tackle widespread graft and crime and speed up delayed economic reforms that are supposed to shore up the country from the global slowdown.

EUOBSERVER / COMMENT - It seldom makes the headlines, but to anyone who follows these things, it's obvious - relations between Slovakia and Hungary could hardly be worse. It's no exaggeration to call it a kind of cold war.

On the face of it, this is odd. Two EU states should not find themselves in such a dysfunctional relationship, for this is precisely what the EU was set up to prevent. The EU, after all, is the best conflict resolution mechanism that Europe has ever had, yet here it has simply stopped working.

"The EU as conflict resolution mechanism only works when those involved want it to work"

Before accession, both states - the EU has member states, not "nations" - were required to sort out their bilateral relations, which to a large extent was done. But potential for trouble remained, overwhelmingly because as between Slovakia and Hungary, state and nation do not coincide.

There is a small Slovak minority in Hungary, maybe 200,000 strong or 2 percent of the population and there is a rather larger Hungarian minority in Slovakia, making up over 10 percent of the population.

EUOBSERVER / BRUSSELS - The cost of the Russia-Ukraine gas war to the EU economy is spiralling into the billions, experts warn, with the European Commission encouraging EU companies to take legal action.

"European gas companies are not selling gas to the tune of about €150 million a day. Electricity producers are also losing hundreds of millions a day," International Energy Agency (IEA) analyst Ian Cronshaw told EUobserver on Wednesday (14 January).

Empty gas vat: EU-wide gas stocks have dropped from 95 percent full to around 60 percent over the past week

"In Bulgaria, Slovakia and the Czech Republic industry is being forced to slow down or shut down. This will spread as European [gas] stock volumes drop and the economic cost will go up exponentially at a time when Europe can least afford it."

A meeting of the Gas Co-ordination Group - EU member states' energy ministry officials - in Brussels on 19 January is to pool data on the impact of the gas crisis so far. But European Commission President Jose Manuel Barroso has already indicated that Brussels will back any legal claims.

EUOBSERVER / BRUSSELS - MEPs on Wednesday (14 January) backed new rules on the introduction of biometric passports throughout the EU later this year, while exempting children under 12 years from having fingerprints included in their passports.

The rules were approved at a first reading by an overwhelming majority of MEPs - 594 against 51, while 37 abstained.

The fingerprints of children under 12 were found not to be sufficiently reliable because they change as the child grows older

The parliamentarians underlined the need to improve document security in the EU by introducing "more reliable biometric data, namely fingerprints," and highlighted the different criteria member states currently apply when checking the passport applicants' identity.

"Many countries require that the citizen applying for a passport actually present him or herself in person, together with their documents and photographs, and in these cases the officials at the passport-issuing office can see if that person bears a resemblance to the photo presented," Polish Christian Democrat Urszula Gacek said during a plenary debate on the issue in Strasbourg on Tuesday.

Germany is ready to make a contribution towards renovation work at the former Nazi death camp of Auschwitz in Poland, a foreign ministry spokeswoman said.

The spokeswoman said the government was in contact with Polish authorities about what was required.

"We consider it a core duty of Germany to keep the memory of the Holocaust alive," she said.

Decaying site

An estimated 1.1 million European Jews died in the gas chambers of Auschwitz during World War II. The concentration camp, built in 1940, is badly in need of repair.

US President-elect Barack Obama faces a full plate of tasks when he takes office -- and Europe will be asked to the table. But will the EU be able to agree on its responsibilities and be willing to take on more?

During his campaign, US President-elect Barack Obama said he believed the invasion of Iraq undermined efforts to defeat the Taliban and al Qaeda in Afghanistan. He has vowed to focus more strongly on Afghanistan after taking office on Jan. 20.

 

Yet with a serious economic crisis battering the United States, the new administration in Washington will have less financial leeway to put money into security issues. Analysts agree that Obama will call on the Europeans for help, for example in increasing the number of international troops in Afghanistan.

 

According to the German Council on Foreign Relations (DGAP) in Berlin, the European Union has to be ready to face these demands.

 

A left-wing militant group has claimed responsibility for shooting and seriously injuring a 21-year-old police officer last week, police say.

In a statement sent to a newspaper, Revolutionary Struggle also said it was behind a gun attack on a police bus on 23 December, in which no-one was hurt.

Revolutionary Struggle has carried out attacks before, including firing a rocket at the US embassy in Athens.

Analysts say they fear Greece's recent unrest could fuel domestic terrorism.

The attacks follow Greece's worst riots in decades, sparked by the fatal police shooting of a teenager in Athens in early December.

Greece on Wednesday became the first big western European economy to have its credit ratings downgraded since the start of the financial crisis because of rising fears over its ballooning public sector debt.

Standard & Poor's decision to cut its ratings sent Greek stocks plunging, saw the euro weaken, and heightened concerns across the eurozone over the public finances of the weaker economies as they take on record levels of debt.

The downgrade of Greece's sovereign credit ratings from A, which is five notches below the top triple A rating, to A minus comes only five days after the country was put on credit watch by S&P.

It turns the spotlight on Portugal and Spain, which were put on credit watch by the agency this week, and Ireland, which was put on a negative outlook last Friday. These countries could face imminent downgrades.

The European Union called a halt on Wednesday to plans to upgrade diplomatic and economic ties with Israel, as Egypt stepped up efforts to secure a 10-day ceasefire to provide a first step to ending the Gaza war.

In the latest sign of the international backlash against Israel's military offensive in the Gaza Strip, which has left more than 1,000 Palestinians dead, Ramiro Cibrian-Uzal, head of a European Commission delegation to Israel, said upgrading ties at a time when Israel was "using its war means in a very dramatic, in a powerful way in Gaza" was "not appropriate".

The Supreme Court Thursday handed down stiff prison sentences to the founders and former top managers of the IT sector company TJ Group.

The two, former CEO Jyrki Salminen and former chairman of the board, Tuomo Tilman, were convicted of insider trading and falsifying stock market reports by a lower court in 2007. At that time, the two were given suspended sentences of two years.

The Supreme Court on Thursday sentenced the two men to two years and four months in prison. They have also been ordered to pay the State close to 7.8 million euros that they gained through fraudulent business practices.

The TJ Group  was founded in 1987 by Tuomo Tilman and Jyrki Salminen. Initially, the Company's name was TJ Tieto Oy, and its business activities consisted of IT consultation and computer software development. In 1990, Markku Montonen became the third partner in the Company. In 1991, the operative focus was shifted to construction of groupware, at first in the IBM Lotus Domino environment, and, starting in 1994, also in the Microsoft Backoffice environment. At the same time, the Company also invested heavily into development of proprietary software. Through 2004, the Group acquired around 20 small consulting companies around N. Europe, chiefly in Finland and Germany.

Unsurprisingly the group has now changed its name to Westend ITC, since the T and the J of the original name will be rehabilitating. Prison might prove a popular place to be in these doom-laden times.

You can't be me, I'm taken

The French Nuclear Safety Authority (Autorité De Sûreté Nucléaire, ASN) has decided to refuse or suspend the accreditation of laboratories run by Electricité de France (EdF) for monitoring radioactivity in the environment around its plants.

I'm wondering if we can find data on whether the leak was serious or not, and if it's true that the French do not cover up or lie about nuclear problems, as the rest of the world does.  EdF says this about their program:

According to EdF, the laboratory on each of its sites carries out systematic measurements and sampling of air, water, fauna and flora within a 5 kilometre radius of the nuclear power plant. The results of these tests along with others, such as water temperature measurements, are published by the sites every month. A complete environmental report is published by the plants every year and submitted to the nuclear regulatory body, public authorities, members of the local information committees and other interested parties.

In other nuclear news, Britain is saved from the crisis in gas supplies brought on by blind trust in the free market, but this time not by the French.  E.on and RWE, two German utilities heavily active in offshore windpower, have agreed to build 6000 MW of new Atomkraft for the struggling nation.  This should also make moot whether the UK should join the Euro or not, as the control of most of the companies in the former UK is moving toward the mainland, what with acquisitions so cheap and all.

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin