“State aid”? Aaah . . . I do wish it was something remotely sexy (sorry, nothing like “marriage aids”) – but alas. It’s namely when an EU member state government provides assistance – usually €€€ – to a domestic company. And it’s a no-no under EU rules, since we’re all supposed to be in a great big unified Euro-area where all companies can compete on equal terms, and a helping hand from your government distorts those terms.

Well, State aid usually is a no-no, but sometimes it’s allowed. And the Belgian French-language business newspaper L’Echo has grabbed a bit of a scoop with its discovery that the EU Commission’s DG Competition is now shooting for “total exposure.”

Here’s journalist Frédéric Rohart’s first paragraph:

Does the whole world need to know which company receives which State aid (loan, subsidy, tax advantage . . . ) and for what amount? The European Commission thinks so, and intends to require that by 2014.

How does “the whole world” get to know? From a website, silly! Or rather, “websites”: the idea is that each member state would be required to set up its own State aid website, presumably under “guidance” from the Commission. We already know from L’Echo that, at a minimum, the information to be posted would have to include name of company, its VAT ID number, and the amount of the aid. (more…)

Get ready!

That’s “Edward Snowden ready to leave for Iceland?”, from Belgium’s leading French-language business newspaper, L’Echo. And then the first paragraph:

A private jet paid by contributions collected by Wikileaks stands ready to take Edward Snowden to Iceland. However, the authorities of that country have not given the green light for the arrival on their territory of the ex-CIA agent [note: this is an incorrect characterization], responsible for unprecedented US intelligence leaks. As he waits, Snowden still is in hiding in Hong Kong.

“The plane can take off tomorrow,” is the further claim of one Olafur Sigurvinsson quoted here, an executive with an Icelandic company responsible for collecting funds for Wikileaks. As to the important question of “From where?”, the answer is apparently “already from China” (i.e. it does not have to fly there first from Iceland, or anywhere else), since it has been rented from a Chinese company.

Please note again: “a Chinese company.” For the key question here concerns the 10,000+ km journey that would take Snowden to Iceland: whichever way they take, there would be plenty of opportunities for interception by the US Air Force, should President Obama so order. And that fact of a Chinese plane adds a delicious dash of potential Sino-American confrontation to the mix; you might not recall, but those two countries already had a serious air-interception incident between them (that time the Chinese forcing down a US military spy-plane) more than ten years ago.

So, will Obama give that order? You’d have to expect so, meaning that Snowden will swiftly be diverted to the usual regime of pre-trial torture at a US military prison somewhere, à la Bradley Manning. Thankfully for him – for Obama, that is – his grand speech before that hand-picked audience at Berlin’s Brandenburg Gate will already be in the past. The German public seemed remarkably content to ignore the latest NSA spying revelations during his visit there, but they could not ignore a slap-in-your-face gesture like that. Nor will the world at large, when it happens, sometime soon now.

By the way, there is also some uncertainty as to whether Iceland might not just reward Snowden for his long flight – even if they allow his arrivel – by promptly turning him over to American authorities themselves. As this L’Echo piece points out, in 2010 the Icelandic Parliament (a.k.a. the Althing) did adopt a resolution declaring the country a refuge for defenders of freedom of expression and transparency. Then again, in the words of Interior Minister Hanna Kristjansdottir (i.e. the official who would be directly in charge of the matter), “[That] resolution has nothing to do with the laws that apply to asylum-seekers.” Oh – well OK, then.

UPDATE: Nevermind. Snowden turns out to be too clever for that, at least when it comes to the means he intends to take to get to Iceland, if that is even where he is heading.

Writing in the Walloon (i.e. Belgian-French) business newspaper L’Écho, in a piece somewhat sarcastically entitled The euro, our Savior, Marc Lambrechts makes a brief macroeconomic survey of the current European scene and comes up with a couple paradoxes. It looks like everybody is feeling better now about the business conditions, as surveys carried out within the Eurozone among both businessmen and consumers show. But this might be nothing more than spring-fever; Lambrechts prepares us for the shock that first-quarter 2010 economic reports are going to bring, showing a marked slowing-down then (e.g. German GDP drop of 0.4%) caused mainly by the severe winter weather and the sharp drop in auto-sales from the expiry of all those national “cash-for-clunkers” purchase-subsidy schemes.

Surely recovery will come about eventually, although with regard to Europe generally economists at the OECD are not optimistic about that happening until the second half of this year. One way for Germany to expedite that for itself, though (since the Germans earn so much from exports), is to get the euro to fall in value against the other major world-currencies – a process to which nothing has contributed more lately than the continuing confusion in the financial markets over Greece’s fiscal problems, which German obstinacy and tight-fistedness at the EU level has only prolonged. “A curious paradox,” Lambrechts calls this.

UPDATE: Strangely, the performance-vs.-confidence balance seems to be reversed in the US, as per this article from the New York Times.

One of the latest developments on the European economic front – during what are otherwise these dog days of a European summer, when most everyone is off on vacation – is the recent announcement that British Airways and the Spanish carrier Iberia have begun discussions about an eventual merger. Featured in that FT piece was this quote from BA chief executive Willie Walsh: “The combined balance sheet, anticipated synergies and network fit between the airlines make a merger an attractive proposition, particularly in the current economic environment.” “Synergies”; “network fit”: I guess one doesn’t get to be CEO of a major international airline like BA without being able to tick the necessary B-school jargon boxes, but what is all that really supposed to mean?

That is what Patrick Anspach, writing in the Belgian paper L’Echo, would also like to know (Do the Air-Mergers Make Any Sense?). We can know what Walsh means when he says “in the current economic environment,” at least: that mainly refers to the ever-climbing (until recently) price for jet fuel that is turning profit-making routes into loss-makers for airlines the world over. And a merger does seem to be a popular thing to do these days, as in the US Delta and Northwest as well as Continental and United have taken recent steps towards union or at least greater cooperation.

But does the latter strategy really produce a solution to the former problem? Or, as Anspach puts it, “is it really useful to throw yourself in to the arms of your neighbor when you are in free-fall?” He thinks not; greater size is not the answer to the current ailments seriously afflicting the airlines. Those “synergies”? They don’t add up to much when two airlines merge, other than getting rid of redundancies where the two companies were engaged in doing the same thing. For the already-announced Delta-Northwest merger, for example, that adds up to savings of only $1 billion, when the two airlines’ combined turnover amounts to some $35 billion. Is that enough of a savings to make the move worthwhile, i.e. to ensure that the combined company will have a greater chance of survival in Walsh’s “current economic environment”?

No, according to Anspach the way to endure rather lies in a company remaining flexible enough to adapt and change the way it has to change to succeed under the new conditions. After all, he reminds us, it wasn’t the dinosaurs that survived back in pre-history.