The UK is getting close to a very dangerous European crossroads.

Donald Tusk, who has just been appointed as the next President of the European Council, said at the end of the day that he cannot imagine the UE without the UK being a member. This is a wise statement. The UK´s place and future is within the Union. However, what we see more and more, in the UK, is that the populism against Europe is getting stronger and stronger. The chances of a no-vote that would force the UK to leave the EU are real. If that happens then both the UK and Europe would have lost. But that´s the nature of politics. One starts a process and then the process becomes a major avalanche. I am afraid that´s the case with the British referendum on the EU membership.

Unless Labour wins the next round of elections…but even in that case, once the dice are thrown it will be very difficult to stop the game or to nullify the outcome. 

End of summer vacations

End of August, end of summer holidays. This summer has been however a very busy one. And as we get into full gear in September, we will see an international scene pretty crowded by a number of key issues. The fragility of the politics has an obvious impact on the economy and the international business climate. But I have to say that surprisingly there is some kind of euphoria on the international financial front. A bit as if the politics and the financial matters were happening in two different worlds. And they are, in many ways. Russia and Ukraine, Syria, Iraq and ISIS, Libya and Egypt, the Ebola crisis, all that looks like crisis in distant planets. Big financial funds and the masters of global business transactions have been able somehow to isolate those crises and they believe the risk of contagion is today lower. But we forget that planets can also get into each other´s trajectory and crash. Prudence is then the right approach as we get into the new season.

Merkel and Eastern Europe: let the lady try her best

Angela Merkel is investing a lot in her country relations with Russia. Germany has a lot of interests in Russia and does not want the tensions between EU and Moscow to get worse. They are already pretty bad, that´s true. But any further deterioration would mean not only that the sanctions regime would continue to bite but also new measures. They would certainly penalise the Russians. They would also bring quite a bit of pain to the EU economies, particularly to the German one. In the circumstances, the German interests – an easing of the tensions on matters related to Ukraine – coincide with the European ones. It is therefore good news to see Merkel trying to find a solution. She has the authority, the resources, the power, and also very good access to Putin´s ears. Let´s hope there will be some progress in the very near future. 

Incompetence is the shortest road to leadership

Incompetent people often have the necessary arrogance that pushes them to leadership positions. And then we become more and more led by people that in normal circumstances should not be in power. 

Qatar should be told to keep away from ISIS

The role and the goals of Qatar in Middle East and also in Africa need to be carefully scrutinised. The Qatari authorities were very much behind the Muslim Brotherhood in Egypt. They invested billions to support the government of former president Mohamed Morsi. They have been very much behind Hamas in Gaza. And now there are questions being raised about their alleged assistance to the terrorist group ISIS.

In many ways, one has to be clear. Qatar should be challenged. And it is also important to underline that any regime that supports ISIS is an accomplice to a criminal organisation of dark-age fanatics. ISIS has no place in the modern world. And no civilised state should think that funding ISIS will serve its own national interests.

I am for a tough and clear diplomacy in this type of situations. 

Common sense is good leadership

Holiday time is no time for comments on international affairs. But it is a time to be optimistic about the common sense of key international leaders. It is not difficult to rock the boat. But it is true leadership to keep the steering straight, clear of the rocks and the sand banks. Common sense is a great leadership quality. Not always appreciated, as media and people like it when there is a big splash, but the truth of the matter is that the current balance in international affairs is good for peace and prosperity in many of our countries. 

Summer break, please do not disturb, we are Europeans

I am now at Vilamoura village in the middle of Algarve, Portugal. This is traditionally a week when the European affairs stop and people just want to think about the beach, the sun and the drinks. But this year summer has been different, with too many things going on in the international arena. People in Iraq, Libya, Liberia, Ukraine and some other hot spots should be told that Europeans do not like to be disturbed by dramatic events in August. Those people who ignore it and get into crisis do it at their own risk. The Europeans are now at the beach…

Brighter days

A sunny day gives a lot of colour to one´s environment. 

Ebola is turning life in Sierra Leone into hell

I was just in contact with Sierra Leone. The stories I am told about the impact of Ebola on the country and the daily lives of the people are just horrendous. Everything is upside down, villages and small towns are just quarantined, and there is fear all over. Just imagine a country where to be sick with fever is quite common, because of malaria and other diseases related to the heat, the humidity, the mediocre quality of the water and poor sanitation. Now, every bout of fever is a reason for panic: is it Ebola?

The outside world is responding as usual. No surprise. We just ignore it. We think the solution is to close the borders and look elsewhere. 

The financial snake and the golden ghost

At present the international scene is very unstable. People with lots of money and greedy egos seem to be particularly confused about the prospects. They have the financial resources, plenty of financial muscle, they get into the markets, buy loads of shares, then get nervous, and move out as swiftly as they came in.

That shows the volatility of the overall geopolitical situation.

It also shows that financial decisions and the related markets are now fully connected all over the world. Early in the morning, well before the beginning of the business day in Europe, people in London, Paris, Frankfurt, and Luxembourg will get all the data from stock exchanges and analysts in Asia. That gives then the trend for the day.

And vice versa. Tomorrow morning, big guys in Hong Kong, Shanghai or Tokyo will start their early hours by looking at the information coming during night from the US. And that will influence their decision making.

It is often the snake eating its own tail. 

Costly Stavanger

I arrived in Stavanger last night. Coming from Lisbon, it was like a flight between Summer and early Autumn.
It´s cold and windy here But it is quite impressive to see how the city keeps growing, how large and modern business establishments are mushrooming, and also how the residential areas are able to maintain the tranquility, the beauty and the living space local people are so keen to have. In a country with an expensive cost of living, Stavanger is the priciest place.

The oil industry, this is the capital of oil exploration and services in Norway, explains the costs. It is also pretty interesting to look at the human landscape. The place is attracting a good number of immigrants, from many parts of Europe, Poland for instance, as well as refugees from the Middle East and elsewhere. And I have developed a test. If I address someone in English and he or she only replies in Norwegian, than the fellow is either from Eastern Europe or from Iraq or near by.

Most Europeans believe in the future of the EU

The daily “La Libre Belgique”, a key newspaper in Brussels, is conducting a survey on line about the future of the European Union. Basically, the question is: do you think the EU will disintegrate in the future? Over 7,000 people have now replied and only 30% said yes, that there will be no EU in the future.

At a time the common project is under serious attack in almost every EU country, the outcome of this consultation is rather encouraging. For many, Europe remains a project that is worthwhile. 

Striking ISIS is a good decision

President Obama´s decision to strike ISIS extremists in Northern Iraq should be supported by a large number of opinion-makers. It is time to say no to that type of medieval savagery as the one implemented by these fanatics.

This is a good point for the current administration in Washington at a time when the same administration has been losing credibility because of their vacillating position regarding Israel´s violations of international law and the lunacy of Hamas´s political decisions.

We should be much wiser

The international political tensions keep deepening. And they have a major negative impact of trade and investment. We seem to be going back to the international environment that prevailed for several decades after World War II. Around 1985 there was a change to a more constructive engagement. We are now going back to destructive confrontation. The weapons that are being used might belong to the economic realm. But a confrontation is spiralling process and it can therefore make use of other means, inclusive the military ones. To believe that war is something of the past is an idealistic view. Today´s events in Ukraine show that war in Europe is still seen by some as an option. The big difference with 1945 is that in today´s world the means of destruction are much greater. Can we keep that in mind? 

The environment in Eastern Europe is not good

President Vladimir Putin keeps playing tough ball on Ukraine. And he is also raising the stakes in his response to the Western sanctions. Both decisions are serious challenges to peace in Europe.

It would be a mistake to take peace in our continent for granted.

But even if this only part of a gambling approach to international relations, we should not forget that the decisions that are now being implemented carry important economic costs. And we should also keep in mind that when the political leaders are ready to sacrifice the economy that means a lot. One should then redouble the security precautions. Better be alert and prepared. 

Portugal could have been brought down by a single man

Ricardo Salgado, the top man at the Portuguese bank Banco Espírito Santo (BES) had been called by his countrymen the “owner of everything”. He was indeed a very influential fellow. Now, it has been concluded that his bank was in shambles and that the gentleman, who had friends in almost every corner of the political, economic and academic elite chessboards, was about to bring the Portuguese economy down, not just his bank and business empire. His business interests were wide and covered several sectors. The misjudgments, the malpractices and the cover-ups have therefore a very wide impact. The true measure of this collapse is yet to be fully grasped. For the time being, only the bank side of the story has been safeguarded. But an initial lesson that can be learned from this saga is that when a banker is also a major business actor, in a relatively small economy, things can go very wrong. 

Ghana is not moving in the right direction

For a number of years Ghana has been a model country in West Africa. It has managed to move from chaotic politics and poor economic management in the Eighties to democracy and growth in the Nineties and thereafter. But recently things started to move in the wrong direction as the government gave up to extraordinary demands for salary increases and accumulated a high level of fiscal deficit. These actions were taken because the party in power thought they would bring in popular support. They brought economic bankruptcy.

Now, the situation turned to the worst, with the national currency losing value at a rapid pace and the state being unable to meet its commitments. The government had to call the IMF in. This will mean quite a number of public budget cuts. I do not think the Ghanaian public servants are ready for any type of salary reductions.

We might therefore see some political instability coming back to a country we would like to keep calling a model nation.   

Fighting Ebola requires more public information

The international community is now paying attention to the Ebola epidemics in West Africa. And that´s good news. It would be a dramatic mistake to underestimate the risks of a very rapid spreading of Ebola to other countries in Africa and elsewhere.

WHO, the UN World Health Organization, is in the lead. That´s how it should be. Its Director-general, Dr Margaret Chan has been to the region to participate in a summit with the Presidents of Guinea, Sierra Leone and Liberia, the countries most concerned. This was a high profile initiative. As it is the decision to allocate 100 million USD to fight the disease.

Local populations are still very confused about the epidemics. There is a serious need to invest more on health education and on public information. That´s also part of the combat.