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After the meeting between the Portuguese government and the European Commission on 3rd July which marked the start of the Portuguese Presidency of the EU, José Socrates, President in office of the Council and Prime Minister of Portugal along with José Manuel Barroso, President of the European Commission stressed the main objective of the Presidency: "the writing of a new Treaty on the basis of the mandate approved during the last European Council and the approval of the latter in order to avoid any danger of a re-opening and a re-negotiation of the mandate. José Socrates said that "in the mandate received by the presidency to approve the Treaty the possibility of revising the very same mandate was not included," and he said once more that "the Portuguese presidency wanted to reach a settlement of the issue as early as possible," by taking advantage of the "consensus dynamics of 23rd June.

Slovak, Miroslav Lajcak, took office on 2nd July as the International Community's Special Representative in Bosnia-Herzegovina in replacement of Christian Schwarz-Schilling. His term in office will last until June 2008, the date when it is planned for this post to be abolished. Former Ambassador for Slovakia in Tokyo and in Belgrade, Miroslav Lacjak was also mediator and personal representative of the EU High Representative for the Common Foreign and Security Policy, Javier Solana, in Montenegro in 2006.

A delegation of five MEPs travelled to Sudan on 30th June to meet with the authorities there and to visit refugee camps of Kindring II (West Darfur) and Koloma (Chad). They believe that UN and an African Union forces should be deployed as quickly as possible in order to put an end to the crisis. The Darfur crisis requires "a rapid and efficient deployment of a hybrid force armed with an adequate mandate as recently agreed with the Sudanese government," declared Josep Borrell (PSE, ES), President of Development Committee at the European Parliament. "Humanitarian operations cannot continue indefinitely," added Humanitarian Aid rapporteur, Thierry Cornillet (ADLE, FR).

On 11th July the European Commission will hold a public hearing on the implementation of its new strategy to reduce carbon dioxide (CO2) emissions from new cars and vans sold in the European Union. The new strategy, proposed in February 2007, aims to reach the EU objective of 120 g/km average carbon dioxide (CO2) emissions from new cars by 2012 by means of an integrated approach. The public hearing seeks to gather views and ideas from all interested stakeholders on the possible options available for designing the various legislative components of the integrated approach. An internet based public consultation will continue to run until 15th July 2007.

On 5th July during the third round of the presidential election by parliament of a new president to replace Alfred Moisiu whose five year term in office comes to an end at the end of the month the centre-right coalition led by Prime Minister Sali Berisha was five votes short of the 84 necessary (out of 140 MPs) to elect the new head of State. The Albanian Constitution demands the dissolution of parliament and the organisation of new elections if MPs do not manage to appoint a new president after five rounds.

Germany is still the favourite amongst international investors in Europe. According to a ranking published on 28th June by Ernst & Young, Germany is fourth behind China, the USA and India amongst the countries preferred by investors in the world. Above all the leaders of major companies interviewed appreciate the German infrastructure and the highly qualified labour force. Amongst Germany's weaknesses they quote the lack of flexibility in the labour law, the high cost of labour and high company tax. 55% of those interviewed quote Western Europe as one of the three main goals for future investments. This represents a reduction of 13% in comparison with 2006. However Western Europe is still ahead of China (48%). The number of investment projects in Germany increased by more than 57% in one year.

Alexander Milinkevich announced on 6th July in Strasbourg the launch of an information campaign in his country on the benefits of working in partnership with Europe. "Our supporters will distribute brochures to explain the advantages that Belarus might gain from having a partnership with the EU." He also said that he was sorry that the infringements against human rights in his country were no longer the focus of specific investigations on the part of the UN in line with the operation rules adopted on 18th June in Geneva by the UN's Council for Human Rights.

The head of the Spanish government, José Luiz Rodriguez Zapatero announced on 6th July a ministerial reshuffle which will involve the portfolios of the Civil Services, Culture, Housing and Healthcare - the decision comes just eight months before the general elections. This reshuffle aims "to prepare for changes and projects that we have for the next term in office." Elena Salgado, who was Healthcare Minister has become Minister for the Civil Services in replacement of Jordi Sevilla who has left the government. Ms Salgado is replaced by Bernat Soria, a stem cell research specialist. Cesar Antonio Molina, director of the Cervantes Institute has become Culture Minister in replacement of Carmen Calvo who has left the government. Carmen Chacon, Vice President of the Congress of Representatives and a rising figure in the Spanish Socialist Party (PSOE) has become Housing Minister in replacement of Maria Antonia Trujillo who has left the government.

French President Nicolas Sarkozy held a "public meeting on Europe" in Strasbourg on 2nd July to "explain to the French the simplified treaty and the perspectives this opens up for the renaissance of the European project." Saying how happy he was with the successful outcome of the European Council which enabled a "return to politics", he recalled the progress that had been made: "As from 2009 Europe will have new institutions: a stable presidency, a High Representative for Foreign Policy, legal acknowledgement of the Eurogroup, true control of national parliaments over the Commission's proposals for the respect of competence sharing between the Union and the Member States, the qualified majority vote extended to many areas instead of the unanimity rule which forcibly has a paralysing effect in a Europe with 27 members, the strengthening of the role of the European Parliament making Strasbourg the parliamentary capital of Europe, the double majority that will be applied as from 2014."

The central banks of Albania, Bulgaria, Macedonia, Serbia, Romania, Greece and Cyprus announced on 6th July in Athens that they have laid the foundations of a co-operation agreement to facilitate exchange and fight more efficiently against the funding of organised crime. "This framework will improve our co-operation and enable the regulation authorities to work better with banking institutions which are becoming incredibly complicated," declared the governor of the Bank of Greece, Nicholas Garganas.

52 year-old surgeon, Valdis Zatlers was sworn in on 7th July becoming the new Latvian president. Elected on 31st May by Parliament, the new head of State takes power in the midst of a scandal since he has admitted having received bribes on the part of his patients. It will be difficult for him to replace outgoing president Vaira Vike-Freiberga, who after eight years in power is highly reputed both abroad and in her country.

On 3rd July Romanian Deputy Prime Minister, Marko Bela resigned from government. Head of the Democratic Union of Magyars of Romania (UDMR) one of the parties in the ruling coalition, Mr Bela would now like to dedicate his time totally to the management of his party which is struggling to survive.

The Swiss Alinghi team which won the Americas Cup in 2003 in New Zealand defended and retained its title on Tuesday 3rd July in Valencia, Spain, by winning against the New Zealand Emirates Team by 5 wins to 2 and by coming one second ahead in the last and final regatta. The Swiss are the first to have won the trophy and to have kept it in Europe. The next competition will take place again in Europe.

On 5th July the Turkish Constitutional Court supported the constitutional amendments put forward by Recep Tayyip Erdogan's government including one which plans for the election of the Head of State by direct universal suffrage. Ahmet Necdet Sezer, present President of the Republic is opposed to this amendment. Six of the eleven judges in the Court voted to reject the request for annulment. This decision opens the way to a referendum, the date of which still has to be established, on this amendment which would allow the President to be elected by universal suffrage with an election in two rounds, for a five year term in office that would be renewable once. The referendum is the last stage before the possible application of these amendments.

Over 600 participants from Council of Europe Schools of political studies in 15 European countries gathered in Strasbourg from 2nd to 6th July for the second Summer University for Democracy. Political Studies schools aim to train new generations of political, economic, social and cultural leaders in developing countries. Training takes the form of seminars and conferences focussing on themes such as European integration, democracy, Human Rights, the State of Law and globalisation; national and international experts participate in these events. The first school of political studies was created in Moscow in 1992. To date these schools are run in Russia, Georgia, Bulgaria, Moldava, Macedonia/FYROM, Serbia, Bosnia-Herzegovina, Croatia, Albania, Romania, Armenia, Ukraine, Azerbaijan, Montenegro and Kosovo. A project to create a school in Belarus is being developed at the moment.

The European Central Bank expressed its concern on 5th July at signs of budgetary laxism in the euro zone, indirectly pointing to France which is threatening to go back on its commitments. "The board of governors notes with concern the pressure that has emerged in several countries in favour of a relaxation with regard to budgetary objectives," declared ECB president Jean-Claude Trichet. As euro zone Finance Ministers met on 9th July to discuss the subject the guardians of the euro recalled: "it is imperative for all governments to comply with the rules of the European Stability and Growth Pact" especially in the present time of strong economic growth. The warning came as French Prime Minister, François Fillon confirmed this week his government's intention to delay the return of budgetary balance until 2012 instead of 2010 as established by the Stability and Growth Pact.

To everyone's surprise Rodrigo Rato announced on 28th June that he would be leaving his position as Director General of the IMF in October, two years before the end of his term in office. His succession will be discussed at the beginning of the week during the Eurogroup meetings (Finance Ministers of the thirteen countries in the euro zone) and Ecofin (Economy and Finance Ministers of the EU). According to an unwritten rule, Europe appoints the leader of the IMF and the USA that of the World Bank.

According to the first estimates in May 2007, compared to May 2006, the volume of retail trade grew by 0.4% in the euro area and by 1.8% in the EU27. Compared to April 2007 the retail sales index fell by 0.5% and 0.1% respectively. The largest increases over a year were observed in Latvia (+24.3%), Lithuania (+16.5%), Estonia (+15.2%) and Slovakia (+9.9%), and the highest decreases in Luxembourg (-9.9%), Denmark (-2.2%) and Germany (-1.9%). In terms of monthly variations the largest increases were observed in Lithuania (+3.6%), Estonia and Slovakia (both +2.7%) and Latvia (+2.6%), and the highest decreases in Luxembourg (-10.6%), Austria (-2.4%) and Denmark (-2.3%).

On 6th July the Commission published two surveys on communication between the EU and its citizens. One was undertaken amongst the public and the second amongst decision makers. 82% of European citizens believe that it is important to be informed on European issues, 62% of them believe that information in the national media is inadequate - this figure rises to 72% amongst decision makers. Three quarters of European citizens believe that their government must provide more and better information on European affairs. With regard to information sources the TV and written press share the first place ahead of the Internet and the radio. Amongst leading European decision makers 54% believe that the Union is omnipresent in their professional life and 73% think that the information they receive is useful. 48% of them use other sources than the media to gain information.

The euro area started 2007 on a healthy footing, finds the Quarterly Report on the Euro Area published on 3rd July. Economic growth in the first quarter reached 3% in annualised terms spurred by domestic demand, particularly investment. Consumption contracted slightly but is expected to recover quickly as consumer confidence approaches an all-time high. Export growth decelerated, but this reflects mainly statistical effects and, possibly, a cooling off of the international environment rather than the appreciation of the euro. The focus section of the report shows that financial integration clearly has positive effects on economic growth and is also important for the smooth functioning of EMU. Therefore, euro-area Member States have even more to gain from financial integration than other EU Member States.