Government proposes preemptive subsidy probe
In a surprise move, the government announced Monday it will propose establishing a parliamentary investigative committee to examine the OPEKEPE agricultural payments scandal, calling on opposition parties to take a position on the matter.
https://www.ekathimerini.com/politics/1275300/government-proposes-preemptive-subsidy-probe
US lawmakers introduce bipartisan bill for strengthening defense ties with Greece
A bipartisan group of US lawmakers has introduced new legislation seeking to deepen the strategic defense partnership between the United States and Greece amid growing geopolitical instability in Eastern Europe and the Middle East.
Athens faces diplomatic test in Tripoli
The recent publication of Libya’s official letter to the United Nations reasserting the terms of the 2019 Turkish-Libyan maritime accord has stirred diplomatic tensions between Athens and Tripoli. The letter, submitted on June 20 and registered as document A/79/600, accuses Greece of violating Libyan rights by leasing two offshore blocks southwest of Crete to ExxonMobil – an area covered under the contested Turkish-Libyan memorandum.
https://www.ekathimerini.com/politics/foreign-policy/1275298/athens-faces-diplomatic-test-in-tripoli
Androulakis on migration: No room for populism, wishful thinking and backtracking
Main opposition PASOK-Movement for Change leader Nikos Androulakis on Monday, expressed his intention to support Crete, which in recent weeks has been under significant pressure due to increased migration flows.
ATHEX: Stocks forced to pay for Trump tariffs
The Trump tariffs, and the possible European response, got the better of the Greek stock market momentum on Monday, leading to some more losses after Friday’s decline. While turnover was rather significant at the Athens bourse, it was concentrated on select stocks, while the rest of the market showed little movement as buyers saw this was not a good day for positioning themselves.
https://www.ekathimerini.com/economy/1275314/athex-stocks-forced-to-pay-for-trump-tariffs
KATHIMERINI: Ongoing impasse with Libya
TA NEA: Twin threat for bank depositors
EFIMERIDA TON SYNTAKTON: Investigative committee since… the creation of the world
RIZOSPASTIS: Workers will not have the blood of simple folks on their hands
KONTRA NEWS: The government is setting up a theater-act and not a true investigative committee
DIMOKRATIA: OPEKEPE scandal: The PM is operating a “washing service”
NAFTEMPORIKI: No classified status for complaints about tax evasion
DRIVING THE DAY: TRADE RETALIATION LIST
NO MORE MR. NICE EU? Like some B-movie slasher flick, Donald Trump lulled Brussels into thinking everything was gonna be OK-ish … 10 percent tariffs went from bad to tolerable … his people praised the EU’s openness to negotiations on some Sunday morning talk shows … Europe was left off the dreaded list of “letter” recipients, and then … BLAM! … seemingly out of nowhere, he busted out the latest jump-scare, threatening 30 percent levies on EU goods starting Aug. 1.
So as Trump stands there, as if in slowed-down movie time, with the EU backed into a corner, people are starting to question how they got here, how they ended up in this position, and why they can’t seem to fight back when they thought they were so strong. Especially on trade.
Enter Retaliation Round 2: Brussels isn’t yet ready to bring its so-called trade bazooka to this knife fight. But its new list of €72 billion worth of possible retaliation targets, nabbed late Monday by POLITICO’s Camille Gijs, demolishes some of the bloc’s most sacred cows — or should we say holy spirits.
Bourbon back on the levy list: The bulk of the exports targeted are industrial goods, totaling €65.7 billion, while €6.3 billion in agricultural products would also be hit, Camille reports. The list includes bourbon whiskey, despite intense lobbying from France and Ireland to shield the drinks sector from Trump’s reprisals.
Playbook note to self, as your author prepares to visit family in the U.S., via a layover in Ireland: Stock up on Redbreast at the Dublin airport duty-free for American friends, then use dad’s Costco account to buy a double handle of Baker’s, and investigate if maybe, somehow, Kroger’s sells Old Grand Dad.
What else is on the list: The biggest line item in the 200-page list is aircraft and aircraft parts, with tariffs set to target almost €11 billion of U.S. exports — potentially dealing a heavy blow to plane maker Boeing. Machinery, cars and car parts round out the list.
ABOUT THAT SECOND-GUESSING: Brussels is facing criticism even from friendly corners on how it’s handled the negotiations. Publicly celebrating progress in tariff negotiations was a “colossal communication error,” said Aura Salla, a stalwart European People’s Party MEP from Finland, on LinkedIn. “We must be tougher,” she said.
Meta-morphosis: Salla was Facebook’s top lobbyist in Brussels before making the preliminary jump to the Finnish parliament a few years ago. So it caught our attention when she urged that “retaliatory tariffs against U.S. social media platforms should not be excluded from our toolbox” and called for serious consideration of excluding American companies from U.S. public procurement. “I have personally changed my thinking on these issues over the past few years, especially as I look at how the US under Trump’s administration behaves,” Salla wrote.
CAPITALS SUSPENDED IN THE FREEZE FRAME: EU trade chief Maroš Šefčovič insisted that Trump’s latest threats have increased the appetite to retaliate amongst the bloc’s 27 member countries. “The message was the strongest I’ve witnessed since we started the discussions with the U.S.,” he told reporters.
Yet the EU is delaying its own countermeasures till Aug. 6. Member countries are still hoping Trump will rewind and spare the heart of Europe’s industrial sector. Antonia Zimmermann, Camille and Koen Verhelst sort through these mixed signals.
No sudden movements: “We don’t think that in this phase … that we should escalate our rhetoric or our measures,” Lithuanian Foreign Minister Kęstutis Budrys told POLITICO’s Gabriel Gavin. “We expect that there will be a deal that our businesses and our companies are waiting for.”
Misery loves company: Commission President Ursula von der Leyen and Canadian Prime Minister Mark Carney gushed over their new, closer ties on Monday, per a readout.
Now read: Trump thinks the U.S. holds all the cards on trade — but he is misguided, argues former U.S. Ambassador to NATO Ivo Daalder in an op-ed for POLITICO.
BOT-TOMS UP
SHOT: EU calls in X to talk Grok after antisemitic outbursts
CHASER: The Pentagon will start using Musk’s Grok
SOBER MFF
NOT MUCH MFFUN: There’s not a lot of playtime for Commission officials in the days before Ursula von der Leyen unveils her seven-year budget plan for the EU. Cabinet members met in marathon sessions to try to finalize the multiannual financial framework over the weekend, and last night the heads of Cabinets hunkered down with pizza, Coke and water to keep them going, Playbook’s Tim Ross hears. The talks began at 3 p.m. and were still going six hours later.
One sleep to go: On Wednesday, the Commission will lay out its blueprint for the MFF. One thing is clear, whatever they come up with, plenty of people will hate it and are likely to go on hating it for the next two years of negotiations. Some countries want zero increase in the overall spending envelope while others want the EU budget to double, Jan Stráský, senior economist at the OECD, tells Tim, for this morning’s POLITICO read on whether the budget is big enough to save the EU from Putin, Trump and Xi.
Pro-spending take: “My assessment would be that by increasing it by less than half you could already achieve a lot of what makes sense to do at the EU level,” Stráský said. “Perhaps let’s say 20 or 30 percent” — which would take the total budget up to around 1.3 percent of GDP — “if well spent, could be a huge improvement.”
Persistent frugal take: “Sweden is mindful of not just buying into the narrative that now we need a larger budget because we have new problems to handle,” Swedish EU Affairs Minister Jessica Rosencrantz told POLITICO. “We will have to do priorities within the budget.”
SIREN — VDL MAKES CONCESSIONS RIGHT AND LEFT: The threat of internal revolt in the Commission has pushed its president to back down and promise more money to poor regions than previously intended when she presents her plan for the MFF, Gregorio Sorgi reports.
According to a document seen by Gregorio, von der Leyen has delivered a series of last-minute concessions in an effort to placate two of her team at opposite ends of the political spectrum ― Italy’s right-wing Raffaele Fitto and Romanian socialist Roxana Mînzatu. Read more.
POPPING A CAP IN FARM SUBSIDIES:The Commission plans a sweeping shake-up of EU farm subsidies and regional funding, according to a draft regulation obtained by POLITICO’s Bartosz Brzeziński.
How (not to) spend it: The Commission isn’t scrapping the Common Agricultural Policy entirely, but it’s folding it into a much bigger funding pot alongside regional development cash. So the CAP survives, but in a new, blurrier form. Direct payments continue, but national governments will get more say over how to distribute the money. And it’ll be on them to make calls on things like who, exactly, counts as a “farmer.” More details for Pro Agri subscribers here.
RUSSIA’S WAR
AMERICA FIRST APPROACH TO WEAPONS FOR UKRAINE: Donald Trump on Monday went further than he ever has in helping Kyiv fend off Russia’s invasion, greenlighting a European purchase of Patriot missile defense systems and other weapons for Ukraine. But he stressed that his move aligns with his “America First” strategy. “We’re not buying it, but we will manufacture it, and they’re going to be paying for it,” Trump said, referencing “very rich” European allies. Eli Stokols and Dasha Burns have more.
Trump also signaled he’s mad at Vladimir Putin, suggesting he would unilaterally impose “100 percent” tariffs on Russia if there isn’t a peace deal in 50 days. He also said he could at any time throw his weight behind a bipartisan bill to strengthen sanctions on Moscow that the Senate may take up this week. More on that here.
Kaja Kallas is not impressed: “50 days is a very long time,” EU foreign policy chief Kaja Kallas sniffed to reporters, even as she praised Trump’s “strong stance.”
DIPLOMATS ZERO IN ON 18TH SANCTIONS PACKAGE: Hopes are high that Kallas, meanwhile, will be able to deliver a fresh EU response at today’s Foreign Affairs Council in the form of an 18th package of sanctions against Russia, Nick Vinocur writes in to report.
So close, and yet … As we reported in Monday’s Playbook, even as a long-standing block from Slovakia seemed close to resolution, Malta popped up with its own issues.
Diagnosing the Maltese hiccup: Diplomats said Valletta’s holdup had to do with the fact that the Maltese representative at a Coreper on Sunday was unable to get in touch with his leader to get sign-off. “The hope is now that Malta will fall into line and we can get a deal on Tuesday,” an EU diplomat said.
ON USING THE PROCEEDS OF RUSSIAN ASSETS FOR UKRAINE: The EU’s plan to move frozen Russian assets into riskier investments to generate higher returns that could be spent on rebuilding Ukraine would amount to “expropriation,” according to Valérie Urbain, the chief executive of Euroclear. The boss of the Belgium-based depository that holds many of the frozen Russian assets told the FT the plan could undermine Euroclear’s key position in the financial system.
ALSO ON THE FAC AGENDA
ASSESSING OPTIONS ON EU-ISRAEL AGREEMENT: Don’t expect Kallas to actually push for any big changes to the EU’s trade relationship with Israel, two diplomats tell Nick, despite her calls for the country to speed up implementation of last week’s deal to get more aid into Gaza.
On the menu: Kallas is expected to lay out a list of options that range from suspension of trade between the EU and Israel to pausing student exchanges. The possible penalties come after an EU review of its association agreement with Israel found the country falling short of the human rights requirements in the deal.
Little appetite: While a group of EU countries wants the Commission to trigger at least one of the options, there’s probably not enough support from capitals; most of the options require at least a qualified majority if not unanimity. For example, as Lithuania’s Foreign Minister Budrys said of disrupting European relations with Israel, “I do not see, honestly, how it could help us right now, and how it could help the Palestinians right now.”
“We don’t see enough improvement”: Kallas was nonetheless critical of Israel’s implementation of her Gaza aid deal.“We need to see this deal being implemented,” she told reporters after a meeting Monday with Southern Mediterranean nations, including Israel and Palestinian officials.
Benchmarks: An EU official told Nick that Brussels expects at least 160 trucks of aid to be able to enter Gaza via eight additional entry points. The key, per several EU diplomats, is how well Brussels is able to monitor the implementation of the deal. The EU official said monitoring would happen via the bloc’s envoy for the Middle East, Christophe Bigot, as well as the United Nations and contacts with Israeli officials, per the same official.
“Exaggeration”: Israeli Foreign Minister Gideon Sa’ar, pressed over reports of several people being killed at aid distribution sites over the weekend, pushed back, calling the reports “exaggerations.” He blamed Hamas, saying it was trying to stop aid from reaching Gazan civilians and carrying out attacks.
GEORGIA PRESSURE BACK ON: EU diplomats will also discuss plans to scrap a visa-free travel regimen with Georgia in protest over the ruling party’s crackdown on peaceful protests, per two diplomats. The suspension is one of several possible measures on the table, though the EU has for months stopped short of any action against Georgian Dream, the ruling party, amid opposition from a small group of EU countries.
POLICE BLOTTER
REYNDERS MONEY LAUNDERING PROBE DEEPENS: Brussels authorities raided the home and art gallery of prominent antique dealer Olivier Theunissen in the Sablon district in June as part of an investigation into former European Justice Commissioner Didier Reynders, Brussels’ Public Prosecutor’s Office confirmed Monday. The home of Reynders’ former longtime adviser, ex-SNCB chief Jean-Claude Fontinoy, who was a regular buyer at Theunissen’s gallery, has also been searched, according to Follow The Money.
Reminder: Reynders, whose properties were searched a few days after his term ended in December, is suspected of money laundering through the national lottery. He denies the allegations and has not been formally charged.
POLISH MEP FACES HOLOCAUST DENIAL PROBE: Polish prosecutors opened a criminal investigation into far-right MEP Grzegorz Braun on Monday for referring to gas chambers at Auschwitz as “fake.” Read more.
Seeking immunity … again: Poland’s Justice Minister Adam Bodnar told POLITICO’s Wojciech Kość that national authorities would “of course” ask the European Parliament to lift Braun’s immunity. It won’t be the first time. Known for provocative acts, Braun saw his immunity lifted last month so prosecutors could charge him for dousing a Hanukkah menorah (each potential charge requires a separate process of lifting immunity) and he recently burned an EU flag.
Exact timing for the request is unclear, Bodnar added, “but the case certainly doesn’t require any particularly difficult evidentiary steps.”
BROKEN BRUSSELS
THAT DIDN’T TAKE LONG: Fresh hopes of Brussels finally getting a regional government after more than 400 days were ignited when six parties agreed to meet for coalition talks on Monday — but they faded in less than a day following a conflict between the liberal MR and socialist PS.
A misunderstanding: The initial agreement excluded Belgian Prime Minister Bart De Wever’s Flemish nationalist N-VA party from formally joining the coalition. However, as a compromise, MR offered to cede its secretary of state post to a nonpartisan figure from civil society who was acceptable to N-VA. But now, as RTBF reports, PS says it never agreed to a deal that would allow an N-VA-affiliated person to join the talks, even unofficially.
What now: The meeting with six parties was replaced by a series of bilateral meetings to clarify the MR proposal before the group meeting can take place. All parties want to finalize the government deal before Belgium’s National Day on July 21 — but the more realistic deadline now mentioned is September.
IN OTHER NEWS
BRUSSELS ISN’T BANKING ON ITALY: The European Commission warned Rome in a letter on Monday that it appeared to be violating the bloc’s merger rules by citing national security to effectively thwart UniCredit’s bid for rival Banco BPM. The move puts the EU and Italy on a collision course in a highly sensitive sector, report Francesca Micheletti and Ben Munster.
THE KIDS AREN’T ALRIGHT: Slowing vaccination rates are fueling a resurgence of measles and whooping cough in Europe and Central Asia, data published by the World Health Organization and UNICEF today shows. More details for Morning Health Care subscribers.
ROMANIA’S GOVERNMENT SURVIVES NO-CONFIDENCE VOTE: Romanian Prime Minister Ilie Bolojan’s government survived a no-confidence vote on Monday, allowing it to push through increases to VAT, excise duties and other taxes to lower the EU’s largest budget deficit, Reuters reports.
INTERESTING READ: Viktor Orbán’s son-in-law defends his fortune in this FT interview.
UKRAINIAN GOVERNMENT RESHUFFLE: President Volodymyr Zelenskyy asked Yuliia Svyrydenko, currently Ukraine’s deputy prime minister, to lead a new government, he said in his address last night. Denys Shmyhal, the incumbent PM, should become the defense minister, Zelenskyy said. For the reshuffle to be confirmed, Shmyhal will need to submit a resignation to parliament, which will then vote on whether to accept it. Veronika Melkozerova has the details.