10. The Policy Watch

The Policy Watch is a weekly update which aims to provide concise insights into the current policy landscape. Tailored for our members and individuals interested in international affairs, this update offers a brief yet comprehensive summary of key developments affecting policy decisions and political trends in the UK, Sweden, and the EU.

PRIME MINISTER SUNAK CALLS FOR UNITY AGAINST RISING EXTREMISM THREAT

In a speech outside 10 Downing Street, Prime Minister Rishi Sunak addressed the alarming increase in extremist disruption and criminality, highlighting instances of violence and intimidation that have targeted specific communities. Sunak emphasised the need for a collective response from both the government and the public to safeguard the democratic values and multicultural fabric of Britain. He warned against the divisive agendas of Islamist extremists and far-right groups, pledging government action to address the root causes and bolster preventive measures.

SUSPECTED SABOTAGE OF SWEDISH IRON ORE RAILWAY SPARKS MAJOR INVESTIGATION INVOLVING SÄPO

Swedish police are investigating the recent derailment on the Malmbanan railway as possible sabotage, with the Swedish Security Service (SÄPO) involved in the inquiry. The incident, occurring near the previous derailment site, has disrupted iron ore transportation, costing an estimated 100 million kronor per day. Authorities are grappling with extensive damage in a challenging terrain, and the full extent and repair time remain uncertain, posing a significant threat to the mining industry and the Swedish economy.

THE RIKSBANK CHIEF HINTS AT POSSIBLE INTEREST RATE CUT AMID POSITIVE INFLATION OUTLOOK

On Tuesday, the Riksbank Chief Erik Thedéen visited Norrköping to discuss the current economic situation and monetary policy at a seminar hosted by the East Swedish Chamber of Commerce. During the discussions, Thedéen indicated a potential interest rate cut in the first half of the year, contingent upon favourable inflation prospects.

PARLIAMENT ADOPTS PROVISIONAL AGREEMENT ON NATURE RESTORATION TARGETS BY 2050

The European Parliament has adopted the provisional agreement on The EU Nature Restoration Regulation, aiming to restore at least 20% of the EU’s land and sea areas by 2030 and all ecosystems in need of restoration by 2050. The vote was 329 votes in favour, 275 against, and 24 abstentions. The provisional agreement now has to be adopted by the Council to be endorsed as EU Law.

The EU Nature Restoration Regulation tasks Member States with restoring specific habitats from forests to coral beds, with priority given to Natura 2000 areas until 2030, alongside targets for agricultural ecosystems, including peatlands and biodiversity indicators.

TRANSNISTRIAN POLITICIANS URGE PUTIN FOR PROTECTION FROM CHIȘINĂU

Politicians in Transnistria, the Kremlin-backed breakaway region of Moldova, have formally appealed to Russian President Vladimir Putin for protection against perceived pressure from Chișinău. The resolution, adopted in Tiraspol, refrains from explicitly seeking integration into Russia but highlights the presence of over “220,000 Russian citizens” in the region. Despite Moldova’s denial of pressuring Transnistria, tensions persist, with Moscow expressing the protection of Transnistrian residents, including Russian citizens, as a priority.

EUROPE MUST STEP UP: VON DER LEYEN CALLS FOR URGENT ACTION IN EUROPEAN PARLIAMENT SPEECH

President of the European Commission, Ursula von der Leyen, delivered a sobering speech to the European Parliament, highlighting the shattered illusions regarding peace and security in Europe amidst Russia’s brutal aggression against Ukraine.

Von der Leyen emphasised the urgent need for Europe to confront rising authoritarian threats and bolster its security architecture, acknowledging the necessity for increased defence spending and industrial capacity to counter potential conflicts. Urging bold decisions and a new European defence mindset, she called for collective action to strengthen Europe’s sovereignty and security in the face of escalating global tensions.

EU COUNCIL ADOPTS NEW REGULATIONS TO BOOST CAPITAL MARKETS AND INSTANT PAYMENTS

The EU Council has approved a new directive to enhance European capital markets, amending the Alternative Investment Fund Managers Directive and updating the framework for retail investment funds. These changes aim to enhance asset management market integration, improve liquidity management tools, and introduce stricter rules for loan-originating funds, focusing on investor protection and financial stability.

Additionally, a regulation has been adopted to facilitate instant payments in euro across the EU and EEA countries, allowing transfers within ten seconds at any time of day with charges not exceeding those of standard credit transfers. This regulation also aims to strengthen and foster strategic autonomy in the European economic and financial sector by reducing reliance on third-country institutions.