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tv   HAR Dtalk  BBC News  June 3, 2020 4:30am-5:01am BST

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the latest headlines for you from bbc news. protesters across the us are turning out for an eighth night of protests, many defying curfews that are just getting under way in major cities. reports of protests in all 50 states. crowds are, again, gathering near the white house as criticism continues of president trump's handling of the unrest. appearfor appear for protests was tear gassed so appear for protests was tear gassed so president trump would go to his photo opportunity. hundreds have defied a ban by french police to protest against the death in police custody of a black man four years ago. clashes broke out in central paris as crowds called forjustice for adama traore. the officers who detained him have never been charged. here in the uk, a report confirms that black, asian and minority ethnic people are more likely to die of coronavirus than their white counterparts. the health secretary matt hancock said it was still unclear why this was the case, but that the government would get to the bottom of it. now on bbc news, hardtalk.
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welcome to hardtalk. i am stephen sackur. the coronavirus pandemic has hit europe hard, but now that most eu member states have curbed the rate of infection and begun to ease their lockdowns, does the eu have a coherent recovery strategy? my guest todayis coherent recovery strategy? my guest today is mario centeno, finance minister of portugal and head of the euro group —— eurozone group of ministers. has this pandemic exposed the eu's greatest weakness? economic divergences.
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mario centeno in lisbon, welcome to hardtalk. thank you. thank you for having me. we saw deep divisions within the european union at the beginning of the covid—19 pandemic. have those divisions been healed?“ you look back, you may see that these divisions have played a role in all the debate. but at the end of the day, we were able to act fast in a very flexible way, and for me, as president of the euro group, which is very important in a very pragmatic way, we had a few goals to achieve, to react quickly in a sizeable way and in a way that prevents further fragmentation of the european union and especially in
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the european union and especially in the eurozone. but ifi the european union and especially in the eurozone. but if i made, the european union and especially in the eurozone. but ifi made, you really didn't react quickly, did you? we saw the chinese government offer a medical assistant to italy long before other member states of the european union, and we saw some of the members, like the dutch, for example, criticising southern european countries for the weakness of their public finances rather than focusing on offering help. your own prime minister described that as repugnant and small—minded. people don't forget these things, minister. they do not forget, indeed. but the fa ct they do not forget, indeed. but the fact is in economic front, we took ten days in the euro group to approve the three backstops representing 540 billion euros of support for our sovereigns, for firms and for workers. the ecb also
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took only a few days to raise to the occasion and come forward with a new package of help for banks and for the economic fabric of the european union and the eurozone. but what we saw, and maybe what we still see in the european union is that politicians across the member states, first and foremost, think of the self—interest, the national interest of their own countries. at a time of crisis like that, it means the european union finds it very difficult to function collectively. as president of the euro group, i cannot deny that i would prefer domestic policy to be a little bit on the back of our arguments when we are taking decisions for the european union as a whole, or the
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eurozone, which is the same for that matter. but in fact, the several trillion euros in measures that were taken at a national and at a european level speak probably louder than a few otherjudgement than a few altercations with that we may have seen in this process.” few altercations with that we may have seen in this process. i know you are dying to talk to me about there, as you put it, more than trillion euro package that the european commission wants to put together and push through as a recovery and rescue package for europe, and we will talk about it, i promise you. ijust europe, and we will talk about it, i promise you. i just want to focus a bit more on the fact that different nationstates, member state of the eu are pursuing different policies. right now we see it in terms of the easing of the lockdown, where if you visit different countries from austria to germany to france to sweden, all of them are operating their own particular form sweden, all of them are operating their own particularform of post total lockdown strategy. in the case
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of sweden, they never even had a lockdown. they are also operating in different ways in terms of their opening up of orders to each other. you are the european union, but this doesn't sound unified at all. we are in the middle of a very severe and unique sanitary crisis. this is a matter for many people of life or death, and the personal sentiments are very sensitive at this moment. compare us with the us. you have the same sort of debate across us states. you how the house of representatives making proposals through the senate, then the senate rejecting them. the debate in the uk parliament is not much easier than that, and even across regions in the uk, you see the same sort of things. people become very, very sensitive
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when we talk about issues like life and death. i am afraid that we have also to take that into consideration. fairpoint, and i understand that, but as you know much better than me, of movement, for example, is one of the key pillars of the european union. because this time it was not only about the economic and monetary union. it was about the single market, it was about precisely the free movement of people, of workers across europe. people this time in different countries, they need to understand that it was very much the basics of our economies that were at sta ke, basics of our economies that were at stake, and of course, our societies as well. the single market is a pillarfor european as well. the single market is a pillar for european integration as much as the euro, and both things this time were in jeopardy. but
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explain this to me. you are the finance minister of portugal and your economy is deeply dependent on summer your economy is deeply dependent on summer tourism, so your your economy is deeply dependent on summer tourism, so your government summer tourism, so your government has sent the message that tourists are welcome from all over, and we are welcome from all over, and we are opening up. other european countries are not sending the same measures. we have some “— countries are not sending the same measures. we have some —— but are not sending the same message. you have some internal disputes for example the danish and the finisher telling swedes they are not welcome because tourists have a high rate of infection. we have britain, which is not anymore in the european union, but a very close neighbour, saying that all visitors will be quarantined for two weeks if they arrive. it looks like a european mess, and it is an important part of your economy, this notion of tourism and travel within the european union. how are you going to sort it out? this is a sanitary crisis and people are very much afraid of their health. we have to overcome this and we need to make this with a great
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deal of confidence and safety. i think most of those measures are measures that governments will take at the beginning of the confinement period, the exit strategy of the lockdown. in order to understand better how the society and the pandemic reacts to this slow movement of openness. and i expect governments to lift these restrictions as soon as we are confident enough with them. let me ask you bluntly, minister, ifi confident enough with them. let me ask you bluntly, minister, if i may, do you accept that you in portugal have put economic priority above public health priority when you have opened up your country to travellers from overseas, because you are so desperate to save your tourism industry? that is an economic decision which could raise serious risk in terms of public health.“ is true, but take the uk, take the uk example, and then i can give you also the same sort of example for
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portugal. scotland and northern ireland, if i understand correctly, are not going as fast as other parts of the country, right, in terms of exiting the lockdown? the same thing is true for portugal. the area around lisbon is a little bit backwards compared with other parts of the country. for example, i can tell you that algarve a which is where most people from the uk go to holidays, do not have a single case of covid—i9 in the last couple of weeks already. so things are going very well there. so if you want to go to algarve a, you can feel safe, and please visit us as and as you can. iam and please visit us as and as you can. i am also very much eager to visit london in a couple of weeks if it is possible without the lockdown, as soon as you guys it is possible without the lockdown, as soon as you guys in the uk feel confident with opening up the
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borders again. as you say, the situation fluctuates from area to area, ido situation fluctuates from area to area, i do get that. let's take a big picture looked at the european economy, state of health of european economy. we have the imf predicting that the economy could shrink by ten to 12% overall this year. the ecb, the european central bank says that it could go as much as 12% reduction of european gdp. these are absolutely disastrous numbers. christine lingard calling it the biggest economic crisis certainly since the second world war. and we see the debt levels in countries like italy projected to rise to some thing like 160, possibly 170% of national income. how on earth does the eurozone and the wider eu get out of this economic mess? well,
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pretty much as all other economies will. this is temporary, this is very, very serious. iagree will. this is temporary, this is very, very serious. i agree with all the numbers you gave. they are a very good description of the hardship we will experience in the coming months. but we really need to make this a temporary crisis. it does not come as a regular and usual crises in economics do. interest rates are low. we are following a very long, probably the longest path of economic growth in recent history. the employment rate was very, very low at the beginning of this sanitary crisis, one of the champions is the uk, but you have other examples in europe and worldwide. i understand that,
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minister, but the problem i am getting too is that what you have in the midst of this public health rises is an economic crisis, which is exacerbating the fundamental flaws in the european economic system, and that is all about divergences. because while you have italy, italy with a national debt of 150% of gdp, have the dutch and the danes and the swedes with loads of fiscal headroom. they can do whatever they need to do to managers economic crisis. the italians have no headroom at all. you, as president of the euro group, are on top of a system, which is incoherent such as the deep divergences. we learned the lesson from the past, and we could not afford to have this sanitary crisis to morph into a financial crisis. so we really took the measures, and that is my expectation, that allow us to evolve through the crisis without creating
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further fragmentation through the crisis without creating furtherfragmentation in through the crisis without creating further fragmentation in the eurozone and in european union. the measures we talk are meant to a specific goal, which is to level the playing field of our political response at a national level. so that it can somehow reduce the symmetries that you are pointing out. we are all going to get out of this crisis with a larger amount of debt, and we needed, we really needed to find a common instrument in the form in this case of common debt insurance —— insurance to spread the cost of this crisis in a way that we never did before. this isa way that we never did before. this is a very important step towards integration. here, if i is a very important step towards integration. here, ifi may say so, we get to the very heart of the problem. wejust use we get to the very heart of the problem. we just use this phrase, common problem. we just use this phrase, common debt issuance, but the truth is what you are talking about is
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burden sharing, debt sharing. you wa nt burden sharing, debt sharing. you want now the european union as an institution through the commission to go to the financial markets, raise a vast amount of money and pump it into those parts of the union that have been most badly affected by the pandemic. i understand all of that, but it is, in essence, a form of debt utilisation, and that is a concept which many europeans in the prosperous north, these countries won't accept that neutralisation. you have got a very big problem on your hands. the negotiation is under way. i think all countries, including the so—called frugal format, understand the importance of the single market. you know that the netherlands explored 60% of its gdp and the vast majority of their experts are to the
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single market, to the european union, so it would be a very significant change in an economic model for each of our small open economies, if we cannot preserve this vast single market. and what we are doing is precisely taking steps that we never thought we were able to grapple before, for example, this common to grapple before, for example, this common debt issue wasn't avenue was basically a dead hand before. but, hang on, we have had several weeks now of angela merkel and emmanuel macron, and now the commissioner outlining how this massive recovery plan will work and it involves, as you said, in the end over1 trillion euros and long—term borrowing and it involves adapting the eu project for yea rs involves adapting the eu project for years to come. i understand all of that but when you tell me everybody
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has to realise this is vital for the future of the union, the truth is this frugalfour, future of the union, the truth is this frugal four, the future of the union, the truth is this frugalfour, the netherlands, sweden, austria and denmark, they have listened to the argument are not accepting them. i can quote the swedish prime minister saying "wedding has all along pushed along for the fun to focus on loans, we will not accept grants." we have the austrian chancellor saying they are only ready to approve a rescue front that gives out loans. they are not prepared to support your plan. that gives out loans. they are not prepared to support your planlj don't want to enter into each of the countries as you mentioned in terms of domestic policy but i can only say to you that union in sweden and denmark play an important role and they don't have such a clear idea on they don't have such a clear idea on the issues. also the ‘dreams' in austria, they have quite a different perspective and a part of the coalition government — the greens in
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austria. what i want to portray is that, yes, this is a debate and it is important to all of us and please judge asked by the final agreement. ijust want judge asked by the final agreement. i just want to reassure you that we will not give up in the first difficulty we have. but you will have difficulties. give me brief a nswe rs have difficulties. give me brief a nswers to have difficulties. give me brief answers to brief questions. number one, will there be conditionality to the giving out of these grants, huge amounts of money to countries like italy. will there be a demand tied to the grant that italy must restructure, must make some fundamental economic reforms? there will be no conditionality attached other than what is typical in the european union budget. but this weekend, officials in italy, already referred to the very strong commitment of italy to put the country in a sustainable path. we have her promises like that before,
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minister and on another level, what if you are wrong? you say this game is going to work because of the economic recovery post covid—19 will be very quick. what if you are wrong, what if it is not quick and what if the debt amounting continues to rise? at some point it will be unsustainable? or forecasts point in different directions but if you want a picture, iwill give different directions but if you want a picture, i will give you one. think of this as a long, a very long sunday, and we are about to enter monday. as you know, gdp collapses on sundays for our own pleasure and peak very strongly on mondays when, u nfortu nately, we peak very strongly on mondays when, unfortunately, we have to go back to our offices and factories to work. this is precisely what the... . one can only hope the virus recognises the differences between a sunday and a monday, minister! i'm not sure it will work. is this ‘s existential moment for the eu? emmanuel macron
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wa nt moment for the eu? emmanuel macron want a few days ago that the colla pse want a few days ago that the collapse of the eu as a political project was possible if the recovery plan does not get pushed through and does not work? unfortunately, the eu is quite often at the verge of an existential collapse! that has been away existential collapse! that has been any, existential collapse! that has been away many, many commentators describe challenges to the eu for quite some time. but the resilience of the project, the fact that it is the biggest source of peace and prosperity in europe in the last 70 years.... prosperity in europe in the last 70 years. . .. minister, prosperity in europe in the last 70 years.... minister, we hear that phrase all the time but what you say to.... the phrase all the time but what you say to. . .. the italians. .. phrase all the time but what you say to.... the italians... popular because the counterfactual is very negative. yes, the italians now two—thirds of them say it is a disadvantage being part of the eu and at the same time the polls and
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netherlands say that the dutch will be deeply unhappy if the eu promises demutualise the debt of a country like italy. wherever you look at it, north or south, there is a profound problem. what i can say is that the support for the euro is at the highest level ever in italy. 76% of you were — as euro area citizens approve very strongly of the euro. we are providing to this network of support to all member states and to all citizens. i am sure that, even in the more sceptical regions, they do understand that they take the numbers of the netherlands, 60% of their gdp is made of exports and the vast majority of those are for european countries. this is a very, very strong neutralisation of the
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economic model of the netherlands and denmark, of sweden, portugal, of spain. well, you would have to hope you are right and that scepticism does not rise because we see where scepticism can take a nation, it can ta ke scepticism can take a nation, it can take a nation like the united kingdom out of the european union. i will end with a brief question about the state of play in the negotiations between the eu and britain on a future trade agreement. as you know, if there is no agreement to extend the talks, to have an extension to the transition by the end ofjune, they must and by the end of the year and we get the noises from the rubble you chief negotiator, michelle barnier, and the british side, that no progress is being made. how worried are you that there will not be an agreement to extend the talks and the talks will fail, and at the end of this year, the uk will be left trading with the eu on what is called world
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trade organization terms which were, frankly, not be good for either side? well, michelle is negotiating this for the european union as a whole. i think we have showed that we are more united than ever and we need to understand the reasons of the uk but for me the crucial thing isa the uk but for me the crucial thing is a deal to avoid an exit from the uk. so this is very important for both sides on the table and we need to keep focus on having the deal that serves both the uk and the european union. to quote one british minister, he says "i think the cover crisis or some respects will concentrate the minds of eu negotiators, reinforcing the vital importance of reaching a deal." as the pandemic put more pressure on your side, the eu, the pandemic put more pressure on yourside, the eu, to
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the pandemic put more pressure on your side, the eu, to make some compromises with britain? britain, for example, not prepared to accept the idea of a level playing field as pa rt the idea of a level playing field as part of a preferential date — trade deal? well, we have been concentrating from the beginning on getting a deal. i mean, at face value, the argument seems to be a little bit absurd. we need to focus on all aspects of the challenges we have in front of us and, for sure, covid—19 is one of the most important, but we also need to get other issues done. i hope we can do that to the benefit of the uk people and the eu people as well. so that, again, going back to in a much nicer tone, for you to come to visit us and have your summer vacations here
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back, and done in portugal and i think that is very important to have all these issues clarified. think that is very important to have all these issues clarifiedlj think that is very important to have all these issues clarified. i look forward to that prospect. thank you very much indeed forjoining me, minister mario centeno. thank you, stephen. thank you for this opportunity. hello there, the temperature reached 27 celsius in hampshire on tuesday, but that was the last of the very warm days for probably quite sometime. the next few days at least will be feeling much cooler, thanks to a northerly wind. more cloud and some wet weather around as well. that rain certainly arrived
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in scotland during tuesday — knocking temperatures back as well. the cloudier weather, together with the rain, is continuing to push its way southwards overnight. many areas by the end of the night will have had some rain, the exceptions really being towards the southeast and east anglia where it is going to be a little chilly in the countryside and probably drying off later in the night for northern ireland and western scotland. cloudier skies for wednesday in england and wales. some outbreaks of rain as well, could be little heavy at times. across northern ireland, largely dry, little bit of sunshine and missing most of the showers across western scotland, where temperatures may make 18 degrees in glasgow, much cooler with the showers in eastern scotland and across the rest of the uk temperatures quite a bit lower than they were yesterday. continuing that cooler theme through the rest of the week, because pressure is lower across scandinavia where we once had high pressure. instead, high pressure we are treating out into the atlantic.
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it's not close enough to the uk, and it means that we are drawing down a northerly wind which will feed in that cooler air and continue to feed in some showers. perhaps a longer rain to clear away from the southeast of england early on thursday morning, and then a little bit of sunshine but on the whole, pretty cloudy skies and further showers which could be heavy at times as well. if anything in that northerly wind temperatures may be even lower on thursday, typically 14—15 degrees or so, quite a bit cooler than it should be at this time of year. so this weather is quite a change from what we have seen for a long time. those cooler northerly winds pick up again on friday. we will blow down some heavy showers from the north. south wales may get up to 16—17 degrees, but for northern scotland, weird struggling to make double figures. as we head into the weekend, we no longer have high—pressure close to the uk. instead, we are dominated by low pressure, and it's quite a deep one as well. it could bring some unusually windy weather to some northern and western parts of the uk, at least for a while on saturday, some risk of gales. even without the strong winds, it will feel cool in the cloud
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with some showers, and longer spells of rain.
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this is bbc news. i'm sally bundock with the latest headlines for viewers in the uk and around the world. cu rfews defied nationwide: thousands are on the streets of cities across the us as the country sees the eighth night of protests. this is the scene live in los angeles. clashes take place in paris as hundreds call for justice over a death in police custody four years ago. brazil registers a record number of deaths in a day, but there's no let—up on lifting the lockdown.

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