Hollande snubs Cameron

The French president Francois Hollande, last week snubbed British Prime Minister David Cameron at his drive to reduce the proposed EU budget, in which he eventually succeeded.  As Cameron walked into the meeting he said:

 "The numbers are much too high. They need to come down – and if they don't come down there won't be a deal"

Cameron managed to convince German chancellor Angela Merkel and the two EU presidents, Jose Manuel Barroso and Herman Van Rompuy to agree to put forward a lower EU budget as individual EU countries were tightening their belts.  This is the first time the EU budget has been reduced.  Hollande was due to attend the meeting but did not show up.  Instead, he met the leaders of Spain, Italy and Poland – a rival group of southern and eastern European nations that all favour a bigger EU budget than Cameron.  Hollande was keen to preserve measures to boost economic growth and called for an EU budget that:

“Includes savings that do not weaken the economy, has sufficient money earmarked for agriculture and support for poorer regions, while still promoting innovation and protecting the most vulnerable”

The budget still has to be approved by the European Parliament.  There are fierce debates over whether the vote should be secret or open and transparent.  The UK Labour party supports an EU budget cut but Hannes Swoboda, President of the Socialists and Democrats Group in the European Parliament stated that the proposal circulated cuts priority policies that could foster growth and employment.  As the budget outlined is for seven years, there are calls for flexibility, so that adjustments can be made without it going back to the European parliament for approval.

France to roll out the red carpet for UK business

In June 2012 David Cameron said that Britain would roll out the red carpet for wealthy French nationals wanting to leave France due to François Holllande’s implementation of the 75% tax rate for those earning over one million euros per annum.  Fast forward to January 2013 and Laurent Fabius, the French Foreign Secretary is now offering to roll out the red carpet for UK businesses if the UK votes to leave the European Union.

Business’s in the UK have raised concerns about Cameron’s plans, which culminated over two weeks to a letter being published in the Financial Times from Virgin’s Richard Branson, London Stock Exchange head Chris Gibson-Smith and eight other business leaders that warned against Cameron’s plans to renegotiate Britain’s EU membership.

Responding to growing calls from backbench Tories as well as the general public to hold a referendum Cameron has finally said that this will take place in 2017, if a Conservative government wins the next general election.  The British public will get an ‘in or out’ question after Cameron attempts to renegotiate some powers back from Brussels to seemingly gain more sovereignty.  It is unclear whether Cameron would be able to pick and choose which aspects of the European Union he wanted to remain a part of and it would be difficult for him to get a majority of European leaders to agree to his demands.

Barack Obama’s administration has said that they are concerned over Cameron’s plans to renegotiate the UK’s position within the European Union, with a senior official saying the US valued a “strong British voice” in Europe.

Cameron’s announcement last week could put business in jeopardy, as investors uncertain of the UK’s future in Europe may choose not to invest precious resources in the UK.  It could leave the UK vulnerable and isolated, without gaining the UKIP votes expected or satisfying the Eurosceptics within the Conservative party.  It would also leave us without representation in the European Parliament and little say in future legislation behind developed.