Economy

Tucked away in an old building, where few people knows of its existence, lives one of the most important parliamentary creatures – the House of Lords European Union Committee. Often ignored because it applies analysis to a debate where loudness is the main currency, it has produced a new report on the Single Market. The government would do well to read it. For pushing the Single Market should be what animates the Europe Directorate in the Foreign Office. The Single Market is the main reason for British membership of the EU and the committee implies that successive governments, including the Cameron administration, have dropped the ball in this area. As

Robert Peston called it: the Irish banks are mired. The latest round of stress tests has been conducted and the headline figure is that the Irish banks face a shortfall of 24 billion euros. A major recapitalisation will follow and it’s likely that more institutions will be taken under state control. Ireland is also likely to ask for more cash from the EU. These tests were based on conservative criteria, where the Irish economy contracted by 1.6 percent this year, unemployment peaked at 15.8 percent and there was a cumulative collapse in property prices of 62 percent. It’s grim in Ireland, but not that grim: most forecasters are predicting GNP

Nick Clegg is in Mexico, striving to build a trade relationship. The Guardian reports that Clegg will address the Mexican Senate, in Spanish. He will concentrate on praising the education sector, which he hopes to export. There are also plans to open British universities to affluent Mexicans, and Clegg is being accompanied by four universities vice chancellors and David Willetts. At the moment, trade between Britain and Mexico, the world’s 14th largest economy, is negligible – Clegg claims that Britain accounts for less than 1 percent of rapidly developing Mexico’s imports. There are huge opportunities to expand. UK Trade and Investment has 3 dedicated offices in Mexico and it is

Cabinet ministers were relatively relaxed about yesterday’s march against the cuts—and rightly so. It did not make a sea-change in British politics and merely served to underline the lack of a credible alternative to what the coalition is doing. But what does worry ministers is where the growth is going to come from in the economy. The corporation tax cuts and the planning law changes are designed to help big business. But what the Prime Minister is more interested in is small businesses; hence tomorrow’s launch of Start-Up Britain by the Prime Minister. The scheme is designed to offer help—both technical and financial—to those looking to start a business. The

Last night, Portugal’s parliament voted to reject its latest measures to deal with its deficit. It was the fourth time that the Portuguese parliament had been asked for more taxes and for more spending cuts. The result has been a further loss of confidence in Portugal’s ability to pay its debts. Market interest rates have risen to over 8 percent. European leaders are meeting this weekend to work out a path forward. The lessons for us here in the UK are starkly clear. First, it is better to set out all the difficult decisions needed to deal with the debt crisis, even if these take place over a number of