Britain must accept EU standards if it wants full market access: Germany’s Maas

German Foreign Minister Heiko Maas has suggested that the EU’s door would always remain open for Britain to come back. (AFP)
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Updated 29 January 2020

Britain must accept EU standards if it wants full market access: Germany’s Maas

  • ‘By the end of the year, we need to be clear on the shape of our relationship’
  • Referring to the Beatles song “Hello, goodbye,” Maas said that both sides had sorted out the goodbye

BERLIN: Britain will have to compromise on issues such as consumer rights and environment protection if it wants to maintain full access to the European Union’s single market, German Foreign Minister Heiko Maas said on Wednesday.
“By the end of the year, we need to be clear on the shape of our relationship,” Maas wrote in a guest article in German weekly Die Zeit in reference to the post-Brexit transition period.
“So let me say very openly: Yes, we all want zero tariffs and zero trade barriers, but that also means zero dumping and zero unfair competition. Without similar standards to protect our workers, our consumers and the environment, there can be no full access to the largest single market in the world.”
Britain and the European Union will therefore have to conduct the negotiations on their post-Brexit economic relations in a way that “won’t harm the European Union,” Maas said.
Turning to security and defense policies, the minister said that Britain and the EU needed to develop new forms of cooperation, for example by creating a European Security Council.
Such a council could help coordinate joint positions on strategic issues of European security and to respond more quickly to international crises. “We are working with France to flesh out this idea as quickly as possible in order to build a foundation for our future relationship,” Maas wrote.
The German minister also suggested that the EU’s door would always remain open for Britain to come back.
Referring to the Beatles song “Hello, goodbye,” Maas said that both sides had sorted out the goodbye.
“But should this farewell ever turn out to be less final than anticipated, rest assured that we will always have a place for you at our table in Brussels and in our hearts,” he added.


S&P cuts Australia’s sovereign outlook, affirms AAA rating

Updated 08 April 2020

S&P cuts Australia’s sovereign outlook, affirms AAA rating

  • S&P affirmed Australia’s prized rating but said a downgrade was possible within the next two years
  • Australian long-dated bonds sold off after S&P’s outlook downgrade

SYDNEY: Global ratings agency S&P on Wednesday lowered its outlook on Australia’s coveted ‘AAA’ rating to “negative” from “stable” in anticipation of a “material” weakening in the government’s debt position as it splashes out a large fiscal stimulus package.
S&P affirmed Australia’s prized rating but said a downgrade was possible within the next two years if the economic damage from the COVID-19 outbreak is more severe or prolonged than it currently expects.
Australia is among a handful of countries in the world to boast the best ranking from all three major ratings agencies.
But it has come under a cloud as the pandemic has dealt Australia a severe economic and fiscal shock, with S&P predicting the A$2 trillion ($1.23 trillion) economy would plunge into recession for the first time in nearly 30 years.
This would cause a “substantial deterioration of the government’s fiscal headroom at the ‘AAA’ rating level,” S&P said in a statement.
Treasurer Josh Frydenberg said the outlook downgrade was “a reminder of the importance of maintaining our commitment to medium term fiscal sustainability.”
The government has pledged A$320 billion ($197.73 billion) in fiscal spending, or 16.4 percent of annual economic output, to backstop the economy and prevent a crisis as the pandemic shuts companies and leaves many unemployed.
Some fund managers said Wednesday’s outlook downgrade was unlikely to raise the government’s borrowing costs by much though it could hurt Australian companies whose ratings are dependent on the sovereign rating.
“A large proportion of credit funds are mandated to maintain funds in a specific ratings bucket,” said Asmita Kulkarni, Director Investment Strategy at FIIG.
“With potential widespread downgrades we could see funds being forced to sell-down investment which would result in a widening of credit spreads.”
Australian long-dated bonds sold off after S&P’s outlook downgrade with 10-year yields jumping to 0.967 percent from 0.909 percent at Tuesday’s close.
Economists said they do not expect a rating downgrade prior to the federal budget due on Oct. 6.
It was only in September 2018 that S&P upgraded Australia’s outlook to “stable” from “negative” as the budget came close to balance. The government had even projected a surplus for the current fiscal year and next.
While all those predictions are now under water, Australia’s public debt is still in good shape, S&P noted.
“While fiscal stimulus measures will soften the blow presented by the COVID-19 outbreak and weigh heavily on public finances in the immediate future, they won’t structurally weaken Australia’s fiscal position,” S&P said.
“This expected improvement is a key supporting factor of our ‘AAA’ rating.”