Robert Schuman Foundation Chairman Jean-Dominique Giuliani will speak before the Reflection Group on 22nd July; the latter has been asked by the European Council to help the Union rise to the challenges on the horizon of 2020-2030. The group is chaired by former Spanish Prime Minister Felipe Gonzalez.

On 16th July the Executive Council of the IMF expressed its concern with the fragility of the banks and the worsening in the situation of public finances in the UK. The deficit in public finances is believed to lie at 13% of the GDP in 2009 and in 2010 - the gross debt of the public administration is due to double over the next five years up to 100% of the GDP. Indicators of recent economic activity show stabilisation, however a 4.2% GDP contraction is foreseen in 2009 with slight growth at the beginning of 2010 estimated at 0.2%.

On 14th July the Austrian government presented the 2009 Economic Report. Austria's growth forecasts in 2009 lie at -4.3% instead of the 0.9% forecast in the autumn of 2008. Although the car industry is severely affected trade and tourism are stagnating. This report is not only a series of results it also presents perspectives and new guidelines.

INSEE announced on 16th July that consumer prices in France rose slightly by 0.1% in June in comparison with May. However consumer prices dropped for the second consecutive month in June, by 0.5% in comparison with June 2008. This decline over one year is notably the reflection of a contraction in oil prices in comparison with the sharp rise in the summer of 2008. In May the drop in prices over one year (-0.3%) was the first since 1957.

To avoid another financial crisis the European Commission put forward on 13th July a further revision of EU rules on capital requirements for banks that is designed to tighten up the way in which banks assess the risks connected with their trading book; impose higher capital requirements for re-securitisations; increase market confidence through stronger disclosure requirements for securitisation exposures; and require banks to have sound remuneration practices that do not encourage or reward excessive risk-taking. Under the new rules, banks will be restricted in their investments in highly complex re-securitisations if they cannot demonstrate that they have fully understood the risks involved, while national supervisory authorities will review banks' remuneration policies and have the power to impose sanctions if the policies do not meet the new requirements. The proposal, which amends the existing Capital Requirements Directives, represents part of the EU's response to the financial crisis, and reflects consultation with Member States, banking supervisors and industry.

Germany's economic activity "may have stabilised in the second quarter" believes the Economy Ministry in a press released published on 17th July after the publication of several encouraging indicators. "Many signs lead us to believe that economic activity may have stabilised in the second quarter," says the ministry in a monthly report in July, a remark that augurs well as Germany will find out what its GDP was in the spring on 13th August. "Industrial demand has recovered," and perspectives for this sector which is so vital for Germany, have "clearly improved" says the Economy Ministry.

The Central Bank of Ireland reviewed its forecasts with regard to the Irish economy downwards on 14th July now declaring a GDP contraction of 8.3% in 2009 and 3% the following year, whilst in April it had reckoned on a 6.9% decline this year. These forecasts which feature in the latest quarterly economic bulletin published by the bank are even more pessimistic than those released by the government which is officially forcasting a 7.7% GDP contraction this year and 2.9% in 2010. The Irish GDP already contracted by 2.3% in 2008 which is the first first full year recession since 1983 and the most serious ever recorded by the official statistics authorities.

Italy's GDP is due to decline by 5.2% in 2009 according to government forecasts and those issued by the Bank of Italy, published on 15th July. The government's budgetary guidelines approved by the Council of Ministers draws up a sombre picture of the Italy economic situation with a sharp decline in growth of 5.2% after a 1% decrease in 2008. It does however forecast "recovery as from 2010". The Bank of Italy makes the same analysis planning for a GDP fall of 5.2% this year although it should "remain stable next year," according to its July economic bulletin. "Production should recover growth 'at a good pace' in 2010," stressed the Bank of Italy in its report whilst recalling that "uncertainty is still high".

On 13th July South Korean President Lee Myung-bak met Fredrik Reinfeldt, Swedish Prime Minister in Stockholm - the latter is the current chair of the EU. This meeting led to additional progress towards a free trade agreement between the EU and South Korea. "This free-trade agreement provides new opportunities for economic growth and exports. It is also an important message to the world, and a means to countering the rise in world protectionism," said Fredrik Reinfeldt. The latter hopes that negotiations will be completed and that the agreement will be adopted during the Swedish Presidency of the Union. Negotiations on the agreement for free-trade are to continue now amongst the 27 Member States.

On 15th July the Czech Prime Minister Jan Fischer presented the results of the six months of the Czech Presidency of the EU to MEPs.

On 16th July 12 Parliamentary committees out of 20 elected their chairs and deputy chairs (Foreign Affairs: Gabriele Albertini (EPP,IT), International Trade: Vital Moreira (S&D, PT), Budgets: Alain Lamassoure (EPP, FR) Economic and Monetary Affairs: Sharon Bowles (ADLE, UK) Employment and Social Affairs: Pervenche Beres (S&D, FR) Environment, Public Health and Food Security: Jo Leinen (S&D, DE), Industry, Research and Energy: Herbert Reul (EPP, DE), Internal Market and Consumer Protection: Malcolm Harbour (CRE, UK), Judicial Affairs: Klaus-Heiner Lehne (EPP, DE), Civilian Freedom: Juan Fernando Lopez Aguilar (S&D, ES), Women's Rights and Gender Equality: Eva-Britt Svensson, (GUE/NGL, SE), Petitions: Erminia Mazzoni (EPP, IT). Eight other committees will do the same on 20th July. Five questeurs were also elected including two women.

According to final results published on the European Parliament site on 15th July there are 258 women out of 736 MEPs representing 35.05% of the newly elected European Parliament.

On 15th July the Swedish Prime Minister, Fredrik Reinfeldt presented the programme of the Swedish Presidency of the EU to MEPs.

After the gas crisis in January 2009 the European Commission adopted new rules on 16th July aiming to increase the security of gas supplies. The Commission is asking the Member States to set down emergency plans together with the gas industry, to collaborate closely in the event of a crisis and to create national authorities responsible for following developments in gas supplies and to asses potential dangers. Moreover new regulations plan for greater investment in storage equipment and the establishment of means to reverse the flow of gaspipelines towards the most affected countries by suspensions in gas supplies.

Jacques Barrot, Vice-President of the European Commission responsible for Justice, Freedom and Security said he would like rekindle the debate on "sharing the burden" in the reception of asylum seekers between the 27 EU Member States on the occasion of the meeting of the 27 Home Ministers on 16th July. He intends to test the intentions of the Swedish Presidency which, like many other Scandinavian countries together with Germany is rather against any type of obligation. European countries reject 70% of asylum requests forcing candidates underground. Nearly 8 million foreigners live illegally in the EU. "It is unacceptable for an asylum seeker to have to pay a smuggler 5000 dollars to travel from Turkey to Greece," he declared. He said that he intended to travel to Turkey and to Libya in the very near future to negotiate agreements to counter this trend.

On 14th July the European Commission updated the list of airlines which have been withdrawn permission to fly in the EU. Due to safety problems, additonal flying bans were imposed on the airlines of Zambia and Kazakhstan. However four Indonesian companies (Garuda Indonesia, Airfast Indonesia, Mandala Airlines and Premair) together with TAAG Angola Airlines were withdrawn from the blacklist thanks to major improvements in terms of security.

On 16th July after a transitional period of eight years the European Commission ordered the closure of all dumps that do not meet the standards established in the directive on the dumping of rubbish. According to Stavros Dimas, Environment Commissioner, rubbish dumps "that are badly managed and uncontrolled are a danger to public health and for the environment," and in additon to this they can contaminate underground water sources and produce methane, a greenhouse gas that is much more damaging than CO2. For this reason Member States have to reduce biodegradable rubbish sent to the dumps by 50% more than in 1995.

On 13th July the European Commission announced the first calls for tender for research to launch public/private partnerships to stimulate economic recovery and for the development of an ecological, competitive economy. The EU will inject 268 million euros into three key sectors, ie the manufacturing, building and the car industries. In all 3.2 billion euros will be released between 2010 and 2013 for these projects, 50% funded by the Commission and 50% by companies.

The eighth issue of the EDSP newsletter (European Defence and Security Policy) has been published. In the summary of this issue: the fight against piracy in the Gulf of Aden; Afghanistan and EUFOR CHAD/RCA hand over to the UN. An article is devoted to the first EU naval operation (EU NAVFOR-Atalanta) and another to the EU Satellite Centre, which analyses the images and satellite data for EDSP operations. Finally Karl von Wogau who chaired the Defence sub-committee at the European Parliament until 13th July drew up an overview of the EDSP.

Given the economic crisis, social spending is playing an increasingly important role in helping the German economy. This is revealed in the Social Report 2009 approved on 15th July by the government. A consequence of the rise in unemployment social spending increased in 2009 rising from slightly less than 720 billion euro to 754 billion euro. Given the decline in the GDP expected this year, spending is due to respresent 31.9% in comparison with 29% in 2008. The German social protection system ensured the consolidation of its bases before the crisis thanks to structural reform. Social spending led to an easing in the effects of the crisis. On a wider scale the Social Report 2009 compares the German situation with that of other European countries. On this basis the German government wants to promote social progress Europe wide for example via the harmonisation of wage laws and social standards in a globalised economy.

Mid July engineers and technicians established the foundations of an ambitious pilot project off the German coast in the area of air turbine energy production. They set up the first offshore German air turbine in the North Sea just 45 kilometers off the island of Borkum. This giant 180 metre turbine is set in the ocean bed thanks to 45 metre high concrete foundations that weigh 770 tonnes. Apart from the technical skill, the event heralds a new stage in the development of renewable energy production in Germany. The offshore turbine is due to open up new opportunities in air turbine energy production. It may offer up to a 40% increase in energy production. In Germany around twenty projects are now being granted building permission in offshore air turbine parks in the North and Baltic Seas. The first is the "Alpha Ventus" Park that is being built off the island of Borkum and is to include twelve turbines by the end of the year.

For the first time a German president attended the procession on 14th July on the Champs-Elysees. After Chancellors Helmut Kohl in 1994 and Angela Merkel in 2008, the German President Horst Köhler who is starting on his second term in office at Head of State, watched the ceremony from the official stage, next to French President Nicolas Sarkozy. The invitation of the latter "shows the importance granted by President Nicolas Sarkozy to Franco-German relations," said Horst Köhler. On the occasion of the 20th Anniversary of the Franco-Germany Brigade 120 German soldiers from the binational formation paraded on 14th July.

On 15th July the Fiscal and Financial Policy Council accepted the reform of the autonomous communities and towns funding system; this occurred during a meeting at the Economy Ministry 10 votes in favour and 7 abstentions. This new funding model has two goals: the guarantee of all autonomous communties with a maximum of resources and the guarantee of equality for all citizens in terms of public services (health, education, social services) whatever the community they live in. This system offers greater financial autonomy to the communities and devotes 80% of its resources to solidarity, the remaining 20% will be used for other competence transferred over to the communities. This system will include demographic criteria establishing a more effective annual updating mechanism, for example the counting of protected populations, or those in school and the over 65's including factors such as density and isolation.

On 16th July French President Nicolas Sarkozy defined the major ambitions of France's maritime policy in the Havre. He defended the controversial reform of ports that plans for the transfer of 2000 manutention workers towards the private sector and assumed the decisions taken during the 'Grenelle de la Mer' on 8th July with regard to the protection of resources and energy. He wants to modernise the port of the Havre that is of major economic importance and is planning to double the market share of French ports in terms of containers. In addition to this reform Nicolas Sarkozy said he wanted to make the Havre the port of Greater Paris and link the two towns by a TGV connection.

In an open letter on 16th July former Polish Presidents Lech Walesa and Aleksander Kwasniewski, Czech Vaclav Havel, Lithuanian Valdas Adamkus, Romanian Emil Constantinescu, Slovak Michel Kovac, former Latvian President Vaira Vike-Freiberga and former Estonian Prime Minister Mart Laar called on the administration of American President Barack Obama not to forget their region's strategic interests, notably in the face of Russia. "Sometimes we have the impression that many American civil servants believe that our region has been defined once and for all and that they can look into other more urgent strategic issues. This point of view is premature," they wrote. "In our experience a firmer policy with regard to Russia based on values will not only increase security in the West but it will make Moscow more willing to cooperate," they added.

On 16th July British Prime Minister Gordon Brown indicated that the UK was to play a leading role in the fostering of non-proliferation of nuclear weapons and in the extension of the civilian use of nuclear power. A government report stresses the British strategy in terms of non-proliferation and disarmament, before the 2010 conference on the review of the non-proliferation treaty. The strategy paper "Road to 2010" establishes the conditions that should lead nuclear power to fight against climate change, world poverty and energy shortages, to guarantee the security of nuclear equipment, to act against the proliferation of nuclear arms and to build a vital partnership to abolish nuclear arms in a free world.

The EU's high representative for the Common Foreign and Security Policy, Javier Solana, travelled to the Western Balkans on 13th to 15th July. During his visit to Macedonia on 14th July he met Prime Minister Nikola Gruevski. The two men discussed the quarrel over the name of the country which has brought Macedonia into conflict wit Greece and which is preventing EU membership negotiations for the time being. "There is a possible opening" that has appeared to settle the issue said Javier Solana and even though the EU is not taking direct part in the negotiations it is following them attentively and is granting great interest to them.

According to Eurostat figures published on 15th July annual inflation rates in the euro area lay at -0.1% in June 2009 in comparison with 0% in the previous month. In June 2008 the rate lay at 4%. It is the first time that inflation has been negative since the creation of the euro area in 1999 even though the danger of mid term deflation has been rejected for the time being. In the EU inflation rose to 0.6% in June 2009 in comparison with 0.8% in May. A year earlier, inflation lay at 4.3%.

According to Eurostat figures published on 16th July in 2008, price levels for consumer goods and services differed widely across Member States. Denmark (141% of the EU average) had the highest price level, followed by Ireland (127%) and Finland (125%). Whilst Germany (104%) and the Netherlands (103%) and the UK (99% of the EU average) were just around the average the lowest price levels were found in Bulgaria (51%), Romania (62%), Lithuania (67%) and Poland (69%).

According to figures published by Eurostat on 17th July production in the building sector declined by 2% in the euro area and by 2.7% in the EU in May 2009 in comparison with the previous month. In comparison with May 2008 production fell by 8% in the euro area and by 9.6% in the EU.

According to figures published by Eurostat on 17th July euro area external trade rose from -3.8 billion euros in May 2008 to 1.9 billion in May 2009. The balance recorded in April 2009 lay at +2.7 billion. However the EU balance revealed a deficit of 6.8 billion in May 2009 in comparison with -20.7 billion in May 2008. In April 2009 the deficit lay at 8.2 billion. Moreover the Union's trade surplus with the USA decreased from 22.4 billion euros in the first four months of 2008 to 8.9 billion over the same period in 2009. At the same time the trade deficit with China contracted from -49.1 to -46.9 billion and that with Russia dropped from -24.6 billion to -12.6 billion.

The Foundation for Political Innovation has published a study by Jean-Michel Debrat entitled "European Development Policy: a response to the globalisation crisis?" This publication puts forward a panorama of the final goals and specific features of European cooperation, recent progress and future perspectives in the present context of the globalisation crisis.

The Center for European Reform has published a study by Charles Grant entitled "Is Europe doomed to fail as a power?". In his opinion although we can see the importance of Europe in a multipolar world we can also see that Europe has little chance of helping to shape the present world. The divisions between the Member States and the lack of military power have weakened the EU's foreign and defence policy.

On 14th July the European Policy Centre published a study entitled "Economic Recovery to a Greener Economy: mobilising ICT-based Innovations". Author Peter Johnston shows the potential of ITC's believing that they not only help in achieving the Lisbon goals but also guarantee the transformation in a carbon free economy. The study also provides concrete proposals that aim to promote the development of an "intelligent, green economy."

The Munich Festival will take place this year from 24th June to 31st July. The programme set out by new director, Klaus Bacher includes operas: Nabucco, Luisa Miller, Otello, Falstaff and Macbeth by Verdi, Lohengrin by Wagner, Ariane in Naxos by Strauss and Idomene by Mozart, ballets such as Onegin by Tchaikovsky as well as classical music concerts.

What was life like in the GDR before the fall of the Berlin Wall? This is what the Art Academy in Berlin is offering visitors via a series of portraits and scenes from daily life photographed by 17 photographers in the GDR in the 1980's. The exhibition is called "Society in Transition - portraits and scenes from 1980 to 1990". It is open until 11th October. The 482 pictures on show offer an unusual view of the last decade of the GDR.

The Salzburg Festival (25th July-30th August) comprises 186 shows and presents the new productions of "Theodora" by Handel, "Cosi fan Tutte" by Mozart, "Moses and Pharo" by Rossini and a 20th century work "Al gran sole carico d'amore" by Luigi Nono. On the concert programme feature unique operas by Beethoven "Fidelio" as well as the "Figaro's Wedding" by Mozart and "Armida" by Haydn.