Brussels diary

Peace has broken out between Madame Edith Cresson and Monsieur Yves-Thibault de Silguy, the two French commissioners. A pity. Their palace intrigues were straight out of 17th century Versailles. Cresson, the coquette in the Mitterrand entourage who thinks most Englishmen are closet homosexuals; de Silguy, the smug ?narque who switched from Chirac to Balladur and back to Chirac. The couple's scheming and mutual loathing has provided rich entertainment here; but it has damaged the French cause inside the Commission, on the slide since the departure of Jacques Delors. Now comes the ultimate test of French strength.

The Commission must soon decide whether to cave in to French industry's demands for "compensation" to cover the effects of competitive currency devaluations by neighbouring Britain, Italy and Spain. No matter that special assistance for French exporters would flout the principle of a single market. No matter that the French government has only itself to blame for pursuing a franc fort policy which defies economic logic.

In a rare declaration of independence, de Silguy's economics directorate produced a draft report last month which trashed the French case. Its authors pointed out, unhelpfully, that France's hard currency policy had actually boosted long-term French competitiveness by means of low inflation, low import costs and wage restraint which, lest we all forget, is the pre-condition for monetary union with Germany.



Like the French government, de Silguy and Cresson are caught in a bind by this commitment to the franc fort. But if they fail to come up with sweeteners or something like a political pay-off, the explosion from Paris will be as big as anything detonated in the South Pacific. And when the smoke clears, the French opponents of franc fort may be the only ones left standing.

u u u

Europe's travelling circus-a.k.a. the EU's forward-planning Reflection Group-really must sharpen up its act. In little more than a month this grandly-named assortment of ministers, MEPs and former Brussels fonctionnaires is supposed to deliver a report on the constitutional future of Europe, ahead of next year's IGC. So far they've produced little more than a case-study in national rivalries.

Most of the vitriol is reserved for HMG's man in the group, a former SAS officer who has fought his way up from Tory whip to Foreign Office minister. David Davis speaks at machine-gun speed, and loves shooting down ideas floated by colleagues such as Manfred Scheich, Austria's ambassador to the EU. Davis thinks Scheich should be in a padded cell. And he wouldn't mind punching Elmar Brok on the nose.

Brok, a Christian Democrat MEP, is the group's resident Euro-federast; but he's also a pal of Helmut Kohl, so the Foreign Office mandarins are advising restraint. Herr Brok remains unrepentant. His verdict on Davis: "Douglas Hurd inside meetings, Michael Portillo outside."

One of the Reflection Group's dafter ideas is to argue that Europe needs a Dr Kissinger. To be sure, there are many in Washington who would love to send Henry back home to Germany; but this does not appear to be what the Europeans have in mind. What they are trying to do is to make the Maastricht treaty's new-fangled common foreign and security policy more effective, more credible, and in the Brussels jargon, more visible. Carlos Westendorp, the devious Spanish diplomat who chairs the group, regularly quotes Dr K's old question: Who do you call for Europe?

The question is why we need to create a new foreign policy supremo, a new layer of Brussels bureaucracy, and, most likely, a new rival to the Commission which already has four different commissioners running around in charge of EU external relations. One answer is that everyone dreads handing more power to G?nter Burghardt, the fanatical empire-builder who runs the Commission's external political relations directorate. Another is that most people know but dare not say that Burghardt's boss-ex-Dutch foreign minister Hans van den Broek-is a bust.

The more relevant clue, however, lies in French politics-in particular, the strains within the coalition between the Gaullists (headed by President Jacques Chirac) and their UDF liberal partners (headed by ex-President Valery Giscard d'Estaing). Chirac wants Giscard out of Paris before the March 1998 parliamentary elections, so he's trying to tempt him with a big job in Brussels. Jacques Santer is appalled, and has vowed to fight. Watch this space.

u u u

Monetary union may never happen, but competition to name the single currency is real enough. The current favourite is the Euro. The Germans think it sounds better than the French-backed Ecu, but it's a tongue-twister for Italians. It's also mind-numbingly unimaginative.

So what's wrong with calling the new Euro-money the Monnet? Or even the Delors? The smaller currency could then be called the Santer. As everyone knows, ten Santers make one Delors.