Cantillon:The presidency of the European Union is the political equivalent of Viagra, affording endless ratings-boosting photo opportunities for Government ministers as they as chair meetings of their European peers.
But as Michael Noonan candidly admitted to the Irish Tax Institute annual dinner last Friday, they actually have very little scope to influence the subject matter of meetings they chair, the agendas of which have been programmed months if not years in advance.
The only real exception is the “informal” Eurogroup meeting that is held towards the middle of the six-month presidency. The host country gets to put items on the agenda and and can try to get an issue on to the wider European policy agenda.
Noonan told the audience last Friday that he will use the informal meeting to try to make progress on the opening up of the European market for non-bank finance. He is pushing at something of an open door according to his advisers as there is general dissatisfaction in Europe with the availability of bank finance for job creating businesses. The problem – in most cases – being that Europe’s banks are still rebuilding their balance sheets following the 2008 credit crunch and will be cautious lenders at best for some time to come.
Noonan wants his colleagues to discuss how alternative sources of funds could be facilitated and the Irish thinking has in part been informed by their experience of selling Anglo Irish Bank’s €9.5 billion US loan book. This flushed out a panoply of bidders who sourced money from many routes such as the private placement market and investment funds.
Ireland will also point to the recently announced National Pension Reserve Fund initiative which will see the NPRF incentivising the likes of Carlyle, Better Capital and BlueBay to provide funds for Irish business. Quite what Noonan’s colleagues will make of all this new fangled North American thinking remains to be seen. Are they still smarting from subprime or ready to move on?
EIB chief’s cheap-loan plan an easy sell
European Investment Bank vice-president Jonathan Taylor will be pushing an open door today when he meets with a clatter of ministers in Dublin to discuss how the Luxembourg-based bank might support growth in the economy through its cheap loans.
It has disbursed about €3 billion to Ireland over the past five years to support a range of projects – from Terminal 2 at Dublin Airport, to Eirgrid’s east-west interconnector and new schools.
With an additional €60 billion to disburse over the next three years across the EU, Taylor has travelled here to see how it might provide support to Ireland.
The new funds follow on from an injection of €10 billion in capital last year from EU member states – who are shareholders in EIB.
This is money over and above what the EIB would normally lend and is designed to help stimulate growth in Europe’s spluttering economies.
There will be support for big ticket projects but there will also be an increased focus on lending to SMEs.
According to data from from Eurostat, SMEs represent 99 per cent of firms here and 68 per cent of employment.
That’s why the Government made it such a focus of the last budget and its recent jobs action plan.
Since early 2009, the EIB has provided €510 million to Irish SMEs via AIB, Bank of Ireland and Ulster Bank.
It was vital funding at a time when credit markets were frozen.
With its AAA rating, the EIB can access funds at rock-bottom rates. This makes its loans very attractive and with credit remaining tight in Ireland, there’s likely to be no shortage of takers for its increased funding over the next three years.
Mobile platform battle enters next phase
The mobile industry is preparing for a fresh platform battle. The market for smartphone operating systems offers enormous potential to the victors – and even the also-rans – and this week saw the announcement of several new competitors.
At Mobile World Congress in Barcelona, Mozilla gave details of its open-source system. Meanwhile Jolla, a company set up by former Nokia employees, has begun planning a flotation as it pegs its future on reviving a discarded mobile operating system that was once seen as the Finnish group’s smartphone future.
The scale of the challenge facing both is daunting. They are taking on the Google Android and Apple iOS systems. These are the big guns in any battle and have a substantial hold on the market. Google has almost 70 per cent of the global smartphone market, with Apple on 21 per cent, according to Gartner’s latest figures. Microsoft’s Windows and BlackBerry are the most established groups to challenge for at least third place.
Yet there is clearly a belief in the mobile industry that there is room for new players. Mozilla has the backing of 18 mobile groups around the world for its new platform.
Meanwhile, Jolla will roll out its first devices this year using Sailfish, an open-source platform based on the MeeGo operating system developed by Nokia.
No doubt these emerging mobile operating systems are hoping to gain even a small share of the huge global smartphone market, where the focus has moved to emerging markets that have yet to widely adopt internet-connected phones.
Mozilla’s aim is to “connect the next billion” customers who will start to use smartphones in the next few years.
Antti Saario, co-founder and chairman of Jolla, said it would focus on the Chinese mobile market, where the company has struck a distribution deal with the mobile retailer D Phone.
New players would be welcomed by global telecoms groups who want to bring some balance back to the market and challenge the dominance of current players.
