If EU leaders are looking for ways to make the Eastern Partnership successful, there are worse places to start than Moldova. Recent elections brought to power a four-party Alliance for European Integration, making the country the only post-Soviet state (aside from the Baltics) in the last ten years where the transfer of power took place via elections. Moreover, in terms of trade, its dependence on the EU is also greater than that of any other post-Soviet state and its support for European integration is the highest in the region.

Most of the media attention given to the ratification process of the Lisbon Treaty in the Czech Republic has been devoted to the antics of the President, Václav Klaus. The process is being delayed, however, not only by the President’s reservations and requests for a Czech (quasi)opt-out from the EU Charter of Fundamental Rights, but also by the pending review of the Treaty by the Czech Constitutional Court (CCC), which is looking into the Lisbon Treaty for the second time; having delivered its first decision in autumn 2008.

The European Council meeting of June charged the European Commission with responsibility for drafting “by early autumn 2009 at the latest” the proposals to implement a new framework for EU financial supervision, as called for by the de Larosière Committee.

This CEPS Policy Brief is a collective work by a group of CEPS researchers aimed at providing an action plan for the next European Commission. Priorities have been set in four selected policy fields where concrete action is needed immediately: reform of financial sector regulation and oversight, climate change and energy policy, Justice and Home Affairs and the Common Foreign and Security Policy. These fields are crucial to fostering a recovery of the EU economy and allowing the EU to become a real actor on the international scene.

This paper explores the question of whether there is a trade-off between maintaining price stability and financial stability (much in the same way as there can be a trade-off between price stability and output stability when supply shocks occur) and if so, which of the two objectives should take precedence. The authors analyse how such a trade-off can arise and further examine the issue of how to define and monitor financial stability and assess which policy instruments the ECB could deploy to maintain financial stability.

In his latest Policy Brief, Daniel Gros gives a new angle on why the existence of current account ‘imbalances’ should provoke the greatest financial crisis in living history if the raison d’être of a financial system is to deal with imbalances (between savers and investors). He argues that one has to take into account the way current account deficits are financed and how flow imbalances accumulated into large stock disequilibria.

Energy security is a topic that is of increasing importance to policy-makers and yet is a relatively under-researched area. Although macroeconomists have noted that there may be external costs associated with energy security measures, there is no definitive methodology for calculating or assessing these externalities. This paper presents an overview of the theoretical externalities and develops estimates for the size of the external costs of energy arising from energy insecurity. In particular, the research centres on the costs of electricity production and oil.

Energy security is of increasing importance in today’s world, yet little research has been carried out on the costs or benefits of energy security policies. This paper looks at the period after the 1970s to estimate the cost premium of electricity generation due to energy security policies. The cost premium is estimated for France, Germany, Italy and Spain for the period 1980-2000 by estimating actual versus hypothetical lowest cost generation mixes.

This policy brief highlights the main findings of the project on Adequacy and Sustainability of Old-Age Income in the EU (AIM), which was financed by the EU’s 6th Framework Programme and directed by CEPS.

The annual climate change conference (COP14/CMP4) will take place in Poznań, 1–12 December 2008. This Policy Brief aims at providing a brief assessment of where we are on the road from Bali to Copenhagen, thinking ahead of Poznań in relation to the current negotiating environment and exploring the possible nature of an agreed outcome to be reached in Copenhagen at the end of 2009.

Bubbles and crashes are an endemic feature of financial markets in capitalist countries. Thus, as a result of deregulation, the balance sheets of universal banks became fully exposed to these bubbles and crashes, undermining the stability of the banking system. The Basel approach to stabilise the banking system has as an implicit assumption that financial markets are efficient, allowing us to model the risks universal banks take and to compute the required capital ratios that will minimise this risk.

The time is not only ripe but pressing for the EU and the states of the Western Balkans to recalibrate and reinforce the current pre-accession strategy. Trade policy should be moved beyond existing free trade commitments for all the Western Balkans to enter the customs union of the EU and Turkey. Eurozone doctrine should be adapted to realities.

The European Parliament elections taking place on 4-7 June 2009 will provide a unique opportunity for addressing the role and potential of the EU on policies related to an Area of Freedom, Security and Justice (AFSJ). These policies lay at the heart of every citizen’s expectations. This Policy Brief presents ten key issues and policy recommendations for the political parties and their campaign manifestos, in relation to borders, asylum, immigration, data protection and criminal justice.

The intersection between the Commission Communication on a Common Immigration Policy for Europe, another on a Policy Plan on Asylum and the various drafts of the French Presidency’s European Pact on Immigration and Asylum, raises a number of questions: First, what are the nature, context and key issues of the Pact? Does it present anything really new to the current state of affairs in EU law and policy? Second, does the EU really need a pact on immigration and asylum, given the already ongoing processes of Europeanisation surrounding these policy domains?