Serbia has signed a key agreement that will bring it closer to coveted European Union membership. But the Balkan country will have to convince its EU partners and its own countrymen that it's ready to join the bloc.

The Stabilization and Association Agreement (SAA), a precursor to full EU membership talks, was signed on Tuesday, April 29, by the EU foreign ministers and Serbia's Deputy Prime Minister Bozidar Djelic in the presence of the Serbian President, Boris Tadic.

 

Bildunterschrift: Großansicht des Bildes mit der Bildunterschrift:  Djelic (left), Tadic, Solana and Rupel were happy that the job was done

Europe hopes that the deal will boost Serbia's pro-European parties ahead of an upcoming parliamentary vote.

 

But first, the ex-Yugoslav country will have to show it is fully cooperating with the International War Crimes Tribunal in The Hague. EU states will not ratify the pact, nor will Serbia get any trade or other benefits until this condition is met.

Russia has warned it will retaliate if Georgia uses force against its breakaway regions.

Moscow has accused Georgia of preparing to invade Abkhazia, and says it is boosting Russian forces there and in the South Ossetia region.

Georgia has reacted angrily to the Russian move, which its prime minister called "irresponsible".

The EU also urged caution, saying to increase troop numbers would be unwise given current tensions.

Russia's foreign minister said his country was not preparing for war but would "retaliate" to any attack.

The price of power and who foots the bill for Britain's rocketing energy costs took centre stage yesterday as the oil giants Shell and BP unveiled huge combined profits of £7.2bn, made in just three months, and consumers were hit with a new round of steep rises in prices from gas and electricity to air travel.

Npower, Britain's fourth largest domestic power supplier, signalled the start of what experts said will be another round of price increases in gas and electricity after it abolished its cheapest online dual fuel tariff and raised charges for new internet customers by up to 20 per cent. Industry analysts expect all energy bills to rise by another 20 to 25 per cent by next spring, pushing another one million Britons into fuel poverty.

The hike was just one of several being absorbed by consumers yesterday, ranging from an increase of up to £30 per return flight in the fuel surcharge paid by British Airways' passengers, to petrol pump prices now averaging 109p per litre of unleaded fuel. One forecourt in Kent was charging 129p per litre.

LES ULIS, France: When the local bakery increased the price of a baguette for the third time in six months last year, Anne-Laure Renard and Guy Talpot invested in a bread-baking machine. When gasoline became their single biggest monthly expense in January, they decided to sell one of their two cars.

Now, as everything from baby milk to chocolate desserts drives up their living costs, Renard, a teacher, and Talpot, a mailman, are planning their most radical lifestyle change yet: They are getting married to reduce their tax bill.

"I never thought I would be in this position, counting every cent," Renard said one recent evening as her companion measured milk powder for their 13-month-old son, Vincent, in the kitchen. "I mean, I am a teacher. If I can't get by, how do others manage?"

They are not poor, but they are peeved.

Across Europe, people in the middle layer of the labor force - from office workers, civil servants and skilled laborers to low-level managers - are coping with a growing sense that they are being pushed to the margins like never before, as a combination of rising costs and stagnant wages erodes their purchasing power.

Italy's new parliament met for the first time yesterday with applause for Rome's mayor-elect, Gianni Alemanno, a day after followers celebrated his triumph with straight-arm salutes and fascist-era chants.

Alemanno, a former neo-fascist youth leader, took 54% of the vote in a run-off on Sunday and Monday, crushing his rival, Francesco Rutelli, a deputy prime minister in the last, centre-left government.

Silvio Berlusconi, who won a general election earlier this month, welcomed the latest evidence of Italy's leap to the right by declaring: "We are the new Falange." Although he took care to wrap his remark in a classical context, his choice of words appeared to be a nod and a wink to his most extreme supporters.

The original Falange - the word means "phalanx" - was the Spanish fascist party, founded in the 1930s, which supplied Francisco Franco's dictatorship with its ideological underpinning.

One of the most powerful Gulf investors has warned that European attempts to force greater transparency on sovereign wealth funds are making the continent unattractive for investment.

Sultan bin Sulayem, head of Dubai World, said such moves by regulators were discriminatory and would deter him from investing. In an interview with the FT, the head of Dubai's powerful government-backed conglomerate said Europe was now exerting more pressure on SWFs than the US, which has openly resisted Arab investment in assets deemed "strategic".

EUOBSERVER / LUXEMBOURG - With just over a week to go until what is being billed as decisive elections in Serbia, the EU on Tuesday (29 April) sent a strong political signal to the western Balkan country that its future belongs in the European Union.

In a piece of political manoeuvring that gives the pro-EU forces in Belgrade something to use at home but upholds a key European demand, both sides signed a pre-membership deal at a meeting of foreign ministers in Luxembourg.

The deal came after the Netherlands and Belgium dropped their opposition to the move but on condition that the implementation of the agreement depends on Belgrade's cooperation with the UN war crimes tribunal.

"This is a good day, a happy day for both Serbia and the EU," Slovenian foreign minister Dimitrij Rupel whose country currently holds the rotating EU presidency, said after signing the Stabilisation and Association Agreement (SAA) in Luxembourg.

EU trade commissioner Peter Mandelson has conceded that certain biofuel policies contribute to food price rises and increase greenhouse gas emissions, but that Europe's policies are sound.

Instead, Mr Mandelson has suggested that it is Washington's biofuels policies that are having these unwanted consequences.

"We can already see that large-scale biofuel production, especially in the US, may be one of the factors pushing up food prices as it diverts resources from food production," said the commissioner, writing in UK daily the Guardian on Tuesday (29 April).

"The race to grow maize for ethanol subsidies in the US reduces the supply of food crops on world markets and drives up the cost of this important staple," he continued.

EU leaders last spring agreed that the EU should increase the use of biofuels in transport fuel to ten percent by 2020, up from a planned 5.75 percent target to be achieved by 2010.

Brussels criticised on access to documents law

EUOBSERVER/ BRUSSELS - The European Commission's plans to overhaul rules on public access to documents have been strongly criticised by a civil liberties watchdog, which says its proposals are "retrogressive" in key areas.

Due to be unveiled on Wednesday (30 April), the proposal updates a 2001 law on document transparency that has been subject to strong criticism by MEPs and NGOs for being too restrictive.

But according to UK civil liberties organisation Statewatch, the proposed amendments "do not consider many of the fundamental questions posed by civil society and the European Parliament."

"Two of the commission amendments are highly retrogressive," said Statewatch editor Tony Bunyan.

EUOBSERVER / BRUSSELS - Long-delayed partnership talks between the EU and Russia have hit another stumbling block, as Lithuania refuses to approve the launch due to bilateral disputes with Moscow, including one over energy security.

"Our position has not been fully taken into account to date and I am prepared to demand that the issue of the mandate for the EU-Russian talks is taken off the agenda," Lithuanian foreign minister Petras Vaitiekunas told AFP on Monday (28 April).

The warning came only a day before EU foreign ministers are to gather in Luxembourg and approve a negotiating mandate for the talks on the Partnership and Cooperation Agreement - a treaty covering areas such as the economy, external security or justice and home affairs.

The mandate outlines precisely what the European Commission's manoeuvring space will be during the EU-Russia talks planned to be launched at a June EU-Russia summit in Siberia.

EUOBSERVER / BRUSSELS - While budgetary discipline in most of the European Union's member states significantly improved over the past year, the UK and France - the bloc's economic heavy-weights - are expected to breach the public deficit rules by next year.

Joaquin Almunia, the EU's economy commissioner, told reporters on Monday (28 April) that he will in June propose the launch of a disciplinary procedure against Britain for accumulating a higher budgetary deficit than the three percent of GDP threshold.

According to the European Commission's spring economic forecast, the UK's deficit will be 3.3 percent in both 2008 and 2009, with Hungary the only other EU member state set to register higher than the allowed spending this year.

France is also being marked down on the EU's budgetary blacklist. "According to our predictions for growth and impact of the French budgetary and fiscal policies, we imagine that this deficit will go up to 2.9 percent in 2008," said Mr Almunia.

Supermaket(sic) chain Tesco has announced that a range of its own-brand products will carry labels showing the size of the goods' carbon footprints.

Tesco said it would label 20 items, including light bulbs and potatoes, during a two-year trial of the scheme, which is operated by the Carbon Trust.

And:

Shoppers will be able to compare products' carbon footprints

Hmmm.  Not sure how a range of 20 products is going to make that possible.  Still, with the fashion for competitive inflationary greenwash, it might only be a matter of time before a high-end chain announces it will do the same on all its products...

Poor Italy!

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

Mortgage approvals lowest since 1993

Mortgage approvals fell in March to levels not seen since the property slump of the early 1990s, Bank of England figures revealed on Tuesday.

The data came as a leading economist warned that the housing market was "eerily similar" to the US's, which is experiencing the highest default rates since the 1930s.

Approvals on mortgages for new home purchases fell by 11 per cent to 64,000 in March, close to levels not seen since the fourth quarter of 1992, when the UK was in the throes of a property recession. Lending for new house purchases is now at levels not seen since prices were falling in real terms at double-digit annualised rates.

But hey, look! Prospects for the eurozone are eroding! Pity them! Reform! Reform!

In the long run, we're all dead. John Maynard Keynes

Greece agrees to join South Stream pipeline

Greece formally agreed on Tuesday to host a section of Gazprom's planned South Stream natural gas export pipeline, furthering its goal to become a regional transport hub for oil and gas supplies to Europe.

Gazprom, Russia's state-run gas company, is building the pipeline in a partnership with Eni, the Italian oil company, to carry up to 30bn cubic metres a year of Russian gas across the Black Sea to Bulgaria.

From there it will split into two routes - one going north toward Slovenia and Italy, and another going south to Greece and across the Adriatic to Italy.

"The signing of the agreement to construct the Greek part of the South Stream pipeline has become the most important result [of talks]," Vladimir Putin, Russian president, said after a meeting with Kostas Karamanlis, the Greek prime minister.

Analysts say the South Stream project will pose a big challenge to the US and EU-backed Nabucco pipeline scheme. Under Nabucco, gas would come from ex-Soviet Azerbaijan to south Europe via Turkey, in an EU effort to diversify energy sources away from Russia. However, experts say the pipeline's fruition is becoming increasingly difficult as Azeri reserves are questioned.

It's good to see reality trumping over politics.

In the long run, we're all dead. John Maynard Keynes