Will the "grand coalition" come to an end on 27th September next? The Germans are being invited to renew the Bundestag, the lower Chamber in Parliament on that date. Chancellor Angela Merkel (CDU/CSU) is the favourite in the polls and will be facing Foreign Minister Frank-Walter Steinmeier (SPD). Just one month before the election all of the polls are announcing the victory of the CDU. The latter, together with its ally the CSU, is credited with 37% of the vote, the SPD with 22%, the FDP 14%, the Greens 12% and Die Linke 10%. 83% of the Germans believe that Angela Merkel will be re-elected as Chancellor, only 9% believe that Frank-Walter Steinmeier will be the next head of the German government.

On 27th September the Portuguese are being called to renew the 230 members of the Assembly of the Republic, the only Chamber in Parliament. Five political parties are represented there: the Socialist Party led by José Socrates; the Social Democratic Party, the main opposition party led by former Finance Minister, Manuela Ferreira Leite; the People's Party; the Communist Party and the Left Bloc. The Social Democratic Party, that sits in the opposition won the European elections on 7th June last winning 31.71% of the vote whilst the Socialist Party in office won 26.58% of the vote. Will the situation be the same on 27th September?

Around 3 million Norwegians are being called to ballot on 14th September next to renew the 169 members of the National Parliament. The Storting has one particular feature which makes it unique in Europe: it cannot be dissolved. At present seven political parties have seats: the Prime Minister Jens Stoltenberg's Labour Party; the Progress Party led by Siv Jensen, the Conservative Party; the Left Socialist Party, a member of the outgoing government, led by outgoing Finance Minister, Kristin Halvorsen; the Centre Party, a member of the outgoing government; the People's Christian Party and the Liberal Party, the oldest party in Norway. The result achieved by the Progress Party and its possible entry into government is one of the main stakes in this election.

In the second quarter the German GDP rose by 0.3% indicated the Federal Statistics Office on 25th August. Over one year the GDP has declined by 7.1% whilst the public deficit has reached 17.3 billion euros in comparison with a surplus of over 7 billion one year ago.

The European Commission granted aid to a total of 39 million euros on 11th August to Bosnia Herzegovina in response to the financial crisis. This subsidy aims to support SME development and to fund the Deposit Insurance Agency as well as major investments in infrastructures in transport, environment and energy.

The Spanish National Statistics Institute 'INE' review the 2008 growth rate downward to 0.9% against 1.2% as previously announced. In 2008 economic activity contracted over the last two quarters of the year. The INE also reviewed 2007 growth downwards to 3.6% in comparison with 3.7% previously and the rise in 2006 has been brought up to 4% in comparison with 3.9% previously.

According to the Central Statistics Bureau (SSB) Norway came out of recession with a rise of 0.3% of the GDP in the second quarter. Protected by its significant oil reserves the Norwegian economy only experienced two quarters of contraction with a first decline of 1% in the 4th quarter in 2008 and 1.3% in the first quarter of 2009.

The Netherlands' GDP declined by 0.9% in the second quarter in comparison with the first according to an estimate by the Central Statistics Office (CBS) published on 13th August. This decline is greater than in the first quarter and the report highlights a significant fall in the number of jobs available and investments. Over one year the GDP has contracted by 5.1%.

The national statistics institue (INE) in Portugal published growth figures on 13th August. Contrary to all forecasts Portugal experienced slight growth in the second quarter (+0.3%).

Romanian GDP contracted by 1.2% in the second quarter in compparison with the previous quarter said the national statistics institute on 13th August. This is the third consecutive quarter that the Romanian GDP has declined after 10 years of growth. Over one year is has contracted by 8.8%.

The Slovakian National Statistics Office (SURS) has published preliminary GDP figures for Slovakia. According to its first estimates the GDP had declined by 5.3% over one year in the second quarter of 2009 but increased by 2.2% in comparison with the previous quarter. Overall in 2008 the country experienced growth of 6.4% after record annual growth of 10.4% in 2007. The final GDP figures for the second quarter will be published on 2nd September.

The Euro Area Economic Sentiment Indicator (ESI) improved again in August according to the European Commission's report published on 28th August. Figures reveal a significant improvement. Production forecasts on the part of company heads and their perception of developments in production over the last few months have continued to improve for the fifth consecutive month. The indicator is still low however which seems to indicate that industrial production growth was negative in July year on year on and will remain low in August.

In its draft budget 2010 presented on 25th August the Danish government is planning an increase in its aid for development to 0.83% of the gross national income (GNI) in 2010 in comparison with 0.83% in 2009. It hopes to support Denmark's contribution to developing countries in spite of the economic crisis and the record deficit of 4.9% of the GDP.

On 6th August the ECB Governerning Council decided that interest rates on the main refunding operations as well as those on marginal lending and deposit facilities would remain unchanged, at respectively 1%, 1.75% and 0.25%.

The Board of Governors of the International Monetary Fund (IMF) approved on 7th August 2009 a general allocation of Special Drawing Rights (SDRs) equivalent to 250 billion US dollars to provide liquidity to the global economic system by supplementing Fund's member countries' foreign exchange reserves. The allocation was launched on 28th August.

On 22nd August the European Commission published the list of nearly 4000 airlines in the world that have to reduce their CO2 emissions as from 2012 to operate in Europe as part of a fee-paying system. As from January 1st 2012 the companies will have to reduce their emissions to 97% of an annual reference level. They will also have to pay 15% of their licences in order to pollute European countries. The companies that do not respect specific legal deadlines may have to pay high fines.

On 18th August as part of its strategy to fight against tax evasion and fraud the European Commission adopted a proposal to re-write regulations with regard to administrative cooperation in the field of VAT. One of the key elements in the proposal is the establishment of Eurofisc, a structure within which the Member States will fight together against fraud.

On 28th August the European Commission allowed the purchase of Austrian Airlines, which has run into difficulties, by its German counterpart Lufthansa. Lufthansa made commitments with regard to some routes so that its purchase did not lead to a reduced offer and higher prices for consumers.

On 13th August the EU's Union Health Security Committee and the Early Warning and Response authorities (HSC/EWRS) unanimously adopted for the first time two policy statements proposed by the European Commission on public health measures for pandemic influenza A (H1N1) 2009. The statements set out a coordinated European approach on what kind of school closures may be most appropriate to protect public health, and how to balance freedom of movement and public health protection for travellers with flu symptoms.

The new Directive 2009/81/EC on defence and security procurement entered into force on 21st August 2009. The Directive will be the cornerstone of a truly European Defence Market supporting the development of the European defence-related supplier base. Up until now, the vast majority of defence and sensitive security procurement contracts have been exempted from the Internal Market rules. One of the reasons for this is that the existing EU procurement rules are considered to be ill-suited for most defence- and security-related purchases. The new Directive will greatly improve this situation by providing tailor-made procurement rules for defence and security contracts. Member States now have at their disposal Community rules they can apply to complex and sensitive transactions without putting at risk their legitimate security interests.

The European Commission called on 27th August on the major cultural institutions in the EU and private companies such as Google to join together to digitalise Europe's cultural heritage as the debate goes on in several countries including France. On 28th August the Commission reviewed progress made by Europeana, the "multilingual digital library" that was put on line in Novemver 2008 with the major public libraries and museums in Europe. After nine months the number of documents accessible on the site www.europeana.eu (books, maps, photos, films and newspapers) has risen from 2 to 4.6 million.

On 26th August the EU called for an immediate ceasefire in Yemen saying that is was "concerned" by the escalation in violence that had led to many deaths and caused people to flee. "While recognising the responsibility of the Government of Yemen to maintain peace and security within its territory, the European Union is concerned by the recent escalation of the fighting around Sa'dah, which has caused a number of civilian casualties and a worrying number of internally displaced people," indicates a press release by the Swedish Presidency of the EU. "The European Union calls upon all parties to cease fighting immediately," and asks them to work actively towards a negotiated settlement." The European Union also reminds all parties of "their obligation to respect human rights law and international humanitarian law." The government in Yemen in which the Sunnis hold the majority launched an offensive two weeks ago in the north of the country against the Shia Zaïdite rebellion. Some 350,000 people have been forced to flee their homes over the last two weeks due to the escalation in fighting.

Germany's biggest solar farm and the second biggest in the world was inaugurated on 20th August in Lieberose, in the south of Berlin. The solar plant should lead to the production of 53 megawatts per year, ie the energy required by 15,000 households according to operators, Juwi-Gruppe and First Solar.

The advisory boards of German car manufacturers Volkswagen announced on 13th that they had validated a tiered merger plan that is to be completed during 2011. By the end of the year Volkswagen is to take over 42% of Porsche AG, a subsidiary that is 100% owned by Porsche SE holding, by a cash capital increase of 3.3 billion euros. Although the sale of Porsche SE holding to Volkswagen is also planned the brand will maintain its historical HQ in Stuttgart.

Just one month before the general elections on 27th September three regional elections were held in the Länder of Sarre, Saxony and Thuringen on 30th August. Although the Christian-Democratic Union led by Chancellor Angela Merkel is still ahead in the three Länder the CDU did however record a slight decline. In the Sarre it won 34.5% of the vote ahead of the SPD with 24.5%, Die Linke 21.3%, the FDP 9.2% and the Greens 5.9%. In Thuringen it won 31.2% of the vote ahead of Die Linke 27.4%, the SPD 18.5%, the FDP 7.6% and the Greens 6.2%. In Saxony the CDU came out ahead 40.2% far ahead of Die Linke 20.6%, the SPD 10.4%, the FDP 10%, the Green 6.4% and the NPD 5.6%.

After an unexpected fall in unemployment in June (-18,600) in France the number started to rise again in July according to statistics published on 26th August by the Pôle Emploe and Dares. The number of unemployed with no work at all increased by 10,700 in July and by 25.6% over one year. If those with reduced activity are included in the unemployed numbers (+33,000) France has 3.66 million people registered with the Pôle Emploi.

French President Nicolas Sarkozy brought together the bankers of France on 25th August to discuss notably the question of bonus payments. He said that there would be "no bonuses without a surcharge" for traders and that "the payment of bonuses will now be paid in instalments so that "performance is taken into account." German Chancellor Angela Merkel indicated on 26th August that she would support the French initiative in calling for a regulation of bank bonuses internationally. Nicolas Sarkozy is travelling to Berlin on 31st August to meet the Chancellor and prepare for the G20 summit during which he intends to suggest that "all the major G20 financial markets adopt transparency, governance and responsiblity rules now in application in the Parisian market."

On 26th August the French President Nicolas Sarkozy announced at the annual ambassadors conference that he would demand of his G20 partners in Pittsburgh a ceiling on bank bonuses and advise on the refounding of global governance with an extended G8 to G14 (South Africa, Brazil, China, India, Mexico and Egypt). He also spoke in favour of the creation of a world environment organisation. The French President said he was ready to convene, in agreement with the EU and Egypt a second summit for the Union for the Mediterranean in the autumn.

Hungarian President Laszlo Solyom had to cancel a visit that had been planned in a Slovakian border village after being refused access to the country by Slovakian Prime Minister Robert Fico. Laszlo Solyom was to attend the inauguration of a statue devoted to Saint Etienne, the first apostolic king of Hungary in Komarno, a border town in the south of Slovakia that is separated by the Danube from the Hungarian town of Komarom. Relations that are historically difficult between the two countries have worsened since the Slovakian National Party (SNS, nationalist and xenophobic) entered the Slovakian government in July 2006.

The British population rose above the 61 million mark thanks to a sharp increase in births and in spite of a decline in the arrival of immigrant populations in the country according to estimates by the Office for National Statistics (ONS) published on 27th August. The birth rate rose immensely last year with the arrival of 791,000 babies in the UK ie 33,000 more than the previous year.

Georgian President Mikheil Saakashvili announced on 27th August the dismissal of his Defence Minister, Vasil Sikharulidze responsible for rebuilding the armed forces after the defeat in the war with Russia in August 2008. Vasil Sikharulidze, former ambassador in Washington was appointed to Defence in December during a ministerial reshuffle after the war. He has been replaced by Bacho Akhalaia.

On 27th August France and Switzerland signed an extension to their convention on dual taxation thereby enabling the exchange of information in the event of tax fraud, effectively removing the protection of Swiss banking secrecy. The agreement in line with OECD standards is to come into application on 1st January 2010 and was signed in Bern by the President of the Helvetic Confederation Hans-Rudolf Merz and French Economy Minister, Christine Lagarde.

The "New Earth Deal" campaign was launched in London on 26th August with the support of the Parliamentary Assembly of the European Council. It's goal is to encourage rich countries to make even greater commitments to fighting climate change during the Copenhagen Conference in December 2009.

The European Statistics Office, Eurostat published the euro area's economic results in the second quarter of 2009 on 13th August. The economy contracted by 0.1% for the fifth consecutive quarter in spite of renewed growth in Germany and France. Until now the European Commission like the IMF is only forcasting modest recovery in 2010.

The EU now has 500 million inhabitants according to figures released by the European Statistics Office, Eurostat published on 3rd August. The Union's population grew by 2.1 million people in 2008 ie an annual rate of 0.4%. This high performance is the result of natural growth of 0.6 million and a migratory balance of 1.5 million. The euro area population now comprises 328.7 million people.

In July the fall in consumer prices in the euro area was greater than forecast according to the European Statistics Office, Eurostat. Compared with June prices declined by 0.7% in July against the expected 0.6%. Reaching -0.7% over one year this decline is the greatest since the creation of the euro area in 1999 and even since the release of statistics for the area in 1996. For the entire EU consumer prices increased by 0.2% over one year but dropped by 0.5% over one month.

After the first estimates for June 2009 published on 17th August the euro area recorded an external trade surplus of 4.6 billion euros with the rest of the world. The balance recorded in May 2009 lay at +2.1 billion euros. The first estimates of the extra-EU trade balance for June 2009 indicate a deficit of -4.3 billion euros, in comparison with -19.3 billion in June 2008. In May 2009 the balance lay at -7.2 billion euros in comparison with -20.7 billion in May 2008.

The Pinacoteca di Brera, the biggest art museum in Milan that Napoleon wished to become a symbol of French grandeur, celebrated its bicentenary on 15th August. On this occasion the museum put on concerts, guided tours and films on Napoleon to commemorate the official opening to the public on 15th August 1809.

On 5th September the Franco-German TV channel ARTE will broadcast "24h Berlin" that relates daily life in Berlin 20 years after the fall of the Wall, 70 years after the start of the Second World War. "24h Berlin" will introduce you to 24 hours as lived in the German capital.