'Handygate': The number of EU countries involved growing by the minute

Well, this one snowballed quickly. The number of countries either implicated - or feeling the need to comment on - "Handygate" (as the Germans call it) is growing by the minute. Here's a round-up.

Germany: The fallout over allegations that the NSA hacked Angela Merkel's phone continues. According to Bild am Sonntag, US President Barack Obama was personally briefed about the eavesdropping by NSA Director, Keith Alexander, as far back as 2010. Several papers claim that the American embassy in Berlin was used as a hub for the alleged bugging.

However, according to US officials quoted by the WSJ and FAZ, Obama was unaware of the whole affair. The reason? The NSA has so many tapping operations going on that it wouldn't have been practical to brief the President about all of them. The article suggests the White House did scrap some monitoring programmes upon learning about them, including the one tracking Angela Merkel.

Spain: Spanish daily El Mundo dropped a bit of a bomb today, claiming that the NSA bugged over 60 million phone calls in Spain in just one month - between 10 December 2012 and 8 January 2013. The report, also based on former NSA agent Edward Snowden's secret documents, suggested the eavesdropping didn't involve the actual content of the phone calls - just their duration and where they were being made from. But still.

The Spanish Foreign Ministry summoned the US Ambassador in Madrid, James Costos - who later stressed in a statement that the wire-tapping activities have played "a fundamental role" in protecting both US  interests and those of its allies.

Italy: Italian magazine L'Espresso alleged last week that not only the US, but also the UK had been spying on Rome. The latest is that, according to the Cryptome website, the NSA allegedly bugged some 46 million phone calls in Italy between December 2012 and January 2013. But the Italian intelligence service has urged caution, saying there's "no evidence" supporting the claims.

France: Though the French press has been relatively quiet about the episode today, the country has already summoned the ambassador with the accompanied public outrage from politicians. It seems to be dying down a bit in France, though.

Poland: Notoriously Atlanticist, Warsaw has also been forced to go public, with Polish Foreign Minister Radoslaw Sikorski saying over the weekend that the alleged hacking was a "scandal which undermines trust" and that he would be inquiring with Washington whether Poland was also affected by NSA surveillance. However, asked in the interview whether Poland was under surveillance, he apparently answered with a smile: "We also use surveillance".

Sweden: Foreign Minister Carl Bildt has been taking a chilled approach, insisting that he knows "what kind of world we live in" and that "I never say things over the phone that could hurt Sweden if it ended up with a foreign power."

Netherlands: Prime Minister Mark Rutte has said that "I will support [Merkel] completely in her complaint and say that this is not acceptable. I think we need all the facts on the table first."

Belgium:  Belgian Prime Minister Elio Di Rupo commented, "The idea is to have a working method [at the EU level] by the end of the year, which should avoid that friends spy on each other." However, asked on whether the EU should suspend free trade talks with the US, Di Rupo said, "We want to avoid blackmail."

UK: Finally, though the worst fears over suspension of the EU-US trade deal so far have not materialised (although it's still balanced on a knife's edge), David Cameron remains stuck between a rock (the US) and a hard place (Germany). In the Commons today, Cameron talked up the need for a robust intelligence service, saying it has "also allowed us to warn our EU allies about terrorist plots aimed at their people."

US-EU free trade deal could be collateral damage of latest NSA allegations

So we wondered what the big story of the European Council would be. Now we have the answer: Merkel’s cell phone. Der Spiegel today alleged that Merkel's phone may have been targeted by US security services. Merkel called President Obama to make clear that she "unequivocally condemns such practices” and was told that the US is not monitoring and will not monitor her communications (which as German media commentators have identified leaves open the possibility that this could have taken place in the past). The US Ambassador in Berlin was also summoned for a dressing down which follows similar action taken in France over allegations the US also spied on French diplomats.

Because this issue has been hyped-up by the media, this has the potential to be more damaging to Anglo-Saxon-Continental relations than arguably any other episode since the Iraq war - and there are lots of things going on here.

Civil liberties vs. security: As ever, this encapsulates the very sensitive trade-off between the obligation of the state to ensure the security of its citizens and the right of the citizens not to have the state arbitrarily snooping in their business. The Germans – given the painful memory of Stasi and Nazi surveillance – are particularly sensitive to this (and that the German Chancellor herself is the alleged victim adds fuel to the fire). Forget everything else on the agenda of the EU summit today, this is what really is creating the headlines in Germany.

Data protection - EU vs national: Some EU leaders and politicians - including Justice Commissioner Vivianne Reding (for whom this issue is like ideological steroids) are keen to use the long planned overhaul of EU data protection rules to enforce greater EU-level safeguards, though the link to the tapping of Merkel's phone isn't entirely clear. France and Poland are reportedly keen on fast-tracking this issue through the EU legislative process while others including the UK and Scandinavian countries countries are less keen. Germany has not committed itself either way (although German Interior Minister Freidrich said the current version would have to be revised).

The UK vs France: However, the same Data Protection Directive that France wants to pass also featured in the recent UK business taskforce report as an example of EU rules which hurt innovation and growth, and argument echoed by Rohan Silva in today’s Times. Medical research charities have also warned that the new rules - specifically a series of amendments tabled by the Green MEP Jan Philip Albrecht - could starve them of the data they need to work on new treatments. So this issue might also indirectly pit the UK versus France.

Germany vs. the Anglo-Saxon world: This is a critical one - any souring of relations between the US and Germany is bad news, and the UK could well be implicated by association (remember Tempora). The thing to watch out for will be the impact on the EU-US free trade deal currently under negotiation (TTIP) as Germany could now well insist on various complicated privacy safeguards and guarantees which Obama will have hard time delivering (not least since getting a deal past Congress perceived as undermining national security could prove very tricky). If TTIP were to fail, it would embolden those claiming that the UK needs to leave the EU to maximise global trading opportunities,

This is also putting Cameron in a very awkward position as he doesn't want to offend either the Germans or the US - but he'll most certainly be pressed on taking a position.

Secondly, the European Parliament – which also needs to approve the final deal – may see an opportunity here to hijack TTIP to exert its own power. The EP has form on privacy and civil liberty issues, as seen by its attempt to take SWIFT hostage. In fact, SWIFT itself could be complicated by the accusations against the US (we’re not saying that the EP doesn't have any valid arguments in this area).

So this is an episode that most certainly will reverberate for quite some time.

Quotes of the Crisis

The eurozone crisis can't be accused of one thing - providing good quotes from politicians or commentators, most notably some of the comments from Slovakian MPs when that country was debating whether to approve an extension of the EFSF.

This morning as part of our daily look through the European press we found another couple of examples that we thought were worth sharing with a wider audience.

Firstly, in the IHT, we have the ever outspoken Hans Werner Sinn, President of the IFO Institute, rebuking US politicians including President Obama for their stance during the crisis:

“Some critics have argued that Germany, having benefited from the Marshall Plan, now owes it to Europe to undertake a similar rescue. Those critics should look at the numbers…Greece has received a staggering 115 Marshall plans, 29 from Germany alone, and yet the situation has not improved. Why is that not enough, Mr Obama?”

Secondly, we have Alexander Dobrindt, the General Secretary of the CSU lambasting the leadership of the opposition SPD for travelling to Paris to meet with French President Francois Hollane in order to discuss a common approach to the eurozone crisis, who said that:

"This grotesque pilgrimage is certainly not the German interests, but at most in that of the Socialist International.”

Obama to meet with the EU's various Presidents after all

Looks like U.S. President Barack Obama will meet with his "European counterparts" (at least in terms of pay, they're on par), Commission president Jose Manuel Barroso and the President of the European Council Herman Van Rompuy, after all. A NATO summit in Lisbon on 20 November will be used to make up for the Obama Snub earlier this year.

"Presidents Van Rompuy and Barroso are looking forward to this opportunity to meet again with President Obama to reaffirm the transatlantic agenda and advance EU-U.S. cooperation on issues of mutual concern," the Commission said today.

Now, the big question is: who will get the opportunity to shake the great man's hand first?

Lacking confidence

In global affairs, the EU seems to suffer from a peculiar lack of confidence, stemming from its all too frequent failure to come up with anything meaningful to say on the world stage.

This is probably also why EU leaders attach such a huge importance to summits and institutions, such as the External Action Service - they serve as a way for the EU to cover up the absence of substantive policies.

As we've argued before, this is completely the wrong approach. Being an influential voice in the world stems from being a competitive and vibrant global actor with real policies on offer - not from obsessing about family photos, meetings and artificially created institutions. The rest of the world usually sees through the EU's charades, as was evident from the infamous "Obama snub" back in February, when it emerged that the American President had decided to give the EU-US summit a miss this year.

Now we hear that the EU is hoping that a summit with the Americans will go ahead after all, slightly postponed. EU officials hope that they can tack on a meeting to a Nato summit in Lisbon in November.

The newly appointed EU Ambassador to the US João Vale de Almeida - who apparently hopes that he will be "the leading show" among European representatives in Washington DC - complains in the FT about the lack of attention the US gives the EU. “Not being a problem does not mean we should not be a priority,” he says. "There’s untapped potential in this relationship ... We can co-operate better on foreign policy, from Iran to Pakistan, to the Middle East and the Balkans", which is probably true, but again, the focus must be on substance and not handshakes for the sake of them.

A senior US administration official quoted in the FT explains in plain American why the EU shouldn't have too high hopes about incorporating President Obama into its meetings-and-institutions culture:

This president is not a schmoozer – he doesn’t hang out. We don’t feel the need to profess love because it’s a fact of life that Europe is our main partner, in everything that we do in the world … Do you need to say that all the time?

Apparently you do.

So, while EU officials sob about their hurt feelings, here are some suggested themes for an EU-US summit, which could help lure Obama to Europe:

• How to create a financial regulatory framework which underpins global initiatives rather than undermines them;
• How to create a cost-effective model for cutting emissions - one that the rest of world can follow;
• How to cut tariffs and reform rules of origin to free up global trade;
  
• How to produce fewer and better laws to make Europe a more attractive market;
• How to put the money where your mouth is on defence.

Just to start off with.

Obama's not the only one confused by Lisbon

The Obama "snub" continues to gather headlines in today's papers. PJ Crowley, the US Assistant Secretary of State, today confirmed that the uncertainty created by the new posts created under the Lisbon Treaty had been a major factor in Obama's decision to withdraw, saying:

"Because of the changes involving the establishment of a EU council president and a European commission president on top of the rotating EU presidency, I think it's taking some time to work through exactly how various high-level meetings will happen."

And it seems it's not only the Americans who haven't got a clue who they're meant to be talking to. Le Figaro notes that, on his visit to the EU this week, Mongolian President Tsakhia Elbegdorj was left perplexed as to which of the EU's various presidents he was speaking to at any one time. After one meeting, he said:

“I have just been received by the European Council President, I was received yesterday by the President of the European Parliament and after this meeting I will meet the President of the European Council...Er...”

Quite.

"Figure it out and let us know"...

was the message, according to the WSJ, that the US State Department chose to leave on the EU's voicemail this weekend, presumably while the Spanish, who hold the EU Presidency, Herman Van Rompuy and Jose Manuel Barroso all wrestled with each other as they failed to answer the phone.

Although this isn't strictly true, it's an image that fits with the 'Kissinger question' of "who do I call if I want to speak to Europe?", if he ever actually said it that is.

What is true is that President Obama has pulled out of the annual EU-US summit this spring and one of the reasons is that the EU's various presidents have been so busy arguing over who would get to shake his hand first that they apparently forgot to send out the invitations.

In the words of a State Department official, "We don't even know if they're going to have one [a summit]. We've told them, 'Figure it out and let us know.'"

A more diplomatic official said, "Who attends from the US and at what point will depend on who's calling the meeting. There's a competition in Europe because you now have the standing EU architecture."

This was supposed to be the first high-level EU-US summit after the entry into force of the EU's 'magical cure', also known as the Lisbon Treaty, which was billed as the answer to the EU's inability to deal with the outside world as one, creating a President, a Foreign Minster, and a diplomatic service.

But it turns out Obama doesn't seem that bothered about coming round to watch the EU play with its new toys. For some strange reason the US President thinks it's more important to travel to Asia in the spring, to South Africa in the summer and to Portugal for the NATO summit in the Autumn.

Just a thought but maybe that's because there will be people there with something more important to say..

G20 finesse

An interesting feature in today's Guardian showcased at the reaction of correspondents around Europe to the world leaders at the G20.

Fabio Cavalera from Corriere della Sera made a good point that, "Now we will have to check if the political agreements made here will be transformed into legal agreements. The summit also showed the end of the era. Emerging countries like China, India and Brazil are much more important than old countries like France and Italy."

Marc Roche for Le Monde wrote, "It was a particular success for the French and German approach to the crisis. They put on the agenda the fact that you can't just print money to fund your budgetary hole like the British and Americans are doing...The summit has highlighted the fractures between the Anglo-Saxon leaders and the continental leaders."

While there has been a great deal reported on divisions between EU leaders on the merits of financial regulation vs fiscal stimulus, there is now more media coverage pointing to the emergence of a G2 - highlighting that, in the context of the G20, the US and China are the two countries that really matter in reaching global agreement on issues - they are an "elite partnership".

This isn't how Eduardo Suarez at El Mundo sees things, however. He said: "It was funny to see all the journalists leave his [Brown's] press conference before it was over to get to Sarkozy's. I think the summit has shown Sarkozy and Obama are the important leaders here."

Not sure about that. The agreement finally reached by the G20 on banking secrecy and tax havens was reportedly that they would "take note" of the OECD's list of rogue offshore tax havens, rather than "endorse" the list, as Sarko wanted.

Sarko seemed to be targeting Hong Kong and Macau, outside the transparency framework set up by the OECD, of which China is not a member.

You might also remember last year's diplomatique faux pas when Sarkozy spectacularly soured relations with China over his decision to meet with the Dalai Lama, causing China to postpone its summit with the EU, for the first time in the history of such meetings.

Perhaps it was a combination of these two slights, but the Chinese actually refused to turn up to a meeting with the French until a joint statement was issued, moderating France's position on Tibet and reaffirming its commitment to the "One-China" policy. Even then, it took the intervention of Barack Obama to seal a deal on tax havens, requiring the diplomatic finesse that seemed to otherwise elude President Sarkozy.