Brussels Edition: Spending more together

Follow Us Get the newsletter Welcome to the Brussels Edition, Bloomberg's daily briefing on what matters most in the heart of the European Union. Foreign and defense ministers of NATO countries hold separate meetings today as the 30-nation alliance seeks to turn the page on four years of Trumpian "America First." Jens Stoltenberg, the organization's secretary general, stressed the need for "transatlantic unity" on the eve of the virtual gatherings. Ministers will tackle issues from Afghanistan to Ukraine and Belarus and focus on preparations for the alliance's June 14 leaders' summit. On a theme dear to former U.S. President Donald Trump, Stoltenberg urged members to "spend more together" on defense in order to send a powerful message of unity and resolve "both to our people and to any potential adversary." Also on the table will be security challenges posed by climate change and, of course, China — on which Stoltenberg sees allied positions converging.  — John Follain and Viktoria Dendrinou What's Happening Russian Missiles | Turkey's decision to purchase Russian missiles always makes for an awkward topic of discussion on the sidelines of these NATO meetings. In a message of appeasement to Biden, Ankara said it will send home the experts overseeing the S-400 air defense technology. Washington has said Turkey should end the presence of Russian personnel in the country to help with training and assembly of the missiles.  Tax Talks | A full global deal to overhaul tax rules and make multinationals pay more in countries where they operate may not be achieved until October even as a shift from the U.S. accelerates talks, OECD Chief Angel Gurria said yesterday. His comments provide a counterpoint to the sense of expectation building for agreement at the G-7 finance ministers meeting later this week, and the G-20 gathering the following month. Ready to Prosecute | Fraud and corruption involving the use of EU funds will be in the spotlight as of today, when the bloc's first prosecutor's office becomes operational. With record sums about to be doled out to member states — roughly 2 trillion euros in financing from its regular budget and pandemic stimulus fund — the stakes couldn't be higher.  Easing Up | Chancellor Angela Merkel said yesterday in Berlin that she will allow Germany's controversial lockdown law to lapse, the latest sign that the pandemic is releasing its grip on Europe's largest economy. The country passed mandatory restrictions in hard-hit areas, including curfews, in April and the powers will expire at the end of June.  Price Pressures | A key estimate of euro-area inflation is due today, and economists expect it will be at 1.9%, ostensibly meeting the ECB's definition of price stability. That follows data published yesterday that showed Germany's inflation exceeded estimates and rose to the highest level since October 2018. Inflation is also spiking across the globe as the end of lockdowns bolsters demand for goods and services. In Case You Missed It Inflation Target | Central banks can better control inflation expectations if they use a range for price growth rather than a precise goal, according to an ECB study that could have implications for the institution's strategic review. The working paper came as the central bank debates whether its inflation target should be changed — though there is no consensus over what should replace it. Pardoning Separatists | Spanish Prime Minister Pedro Sanchez said he is ready to consider pardons for the imprisoned Catalan separatists who tried to break away from the country almost four years ago, saying it's necessary to move forward. Eleven pro-secession leaders are serving prison sentences for their roles in organizing an illegal referendum and then attempting to declare independence. Policy Change | In Sweden, the central bank governor has slammed a proposal by the government to change laws that guide monetary policy, warning that the planned moves risk colliding with EU rules and undermining policy makers' ability to fight crises. Sweden's government last week unveiled a proposal to amend the legal framework by adding other considerations to the bank's mandate beyond the inflation target, including climate change. Babis Probe | Czech police recommended charging Prime Minister Andrej Babis with fraud after completing an investigation into whether he misused EU funds. The probe is one in a string of legal challenges that have dogged Babis since he won the 2017 elections with promises to root out corruption, keep immigrants out of the country and build more roads. Inconclusive Meeting | As expected, a meeting of the Greek and Turkish foreign ministers in Athens produced no breakthroughs in resolving the disputes between the two neighbors over maritime claims. But at least there was no public exchange of barbs, like the last time they met, and the two sides agreed to recognize each other's vaccination certificates, paving the way for the resumption of travel across the Aegean Sea. Chart of the Day A strengthening world recovery from the Covid-19 pandemic risks leaving behind many regions, fueling inequalities across and within borders, according to the OECD. As the Paris-based group revised up its 2021 global growth forecast to 5.8% from 5.6%, it warned of gaping differences that mean living standards for some people won't return to pre-crisis levels for an extended period.  Today's Agenda All times CET. 9:30 a.m. EU Council President Charles Michel gives speech at the Notre Dame college  11 a.m. Eurostat releases flash estimate about inflation in the euro area in May 11 a.m. Press conference by Commissioner Paolo Gentiloni with EU lawmakers Paul Tang, Sven Giegold and Gabriel Zucman on the Tax Observatory 11 a.m. European Public Prosecutor's Office starts operations 2:30 p.m. Tax transparency trilogue EU Council's Michel and Commission President Ursula von der Leyen meet with Swedish Prime Minister Stefan Lofven EU Parliament, Council and Commission negotiators will try to agree on new EU rules requiring multinational companies to disclose the amount of tax they pay in each EU country NATO ministers of foreign affairs and defense meet via video conference  EU's Valdis Dombrovskis participates in the OECD's Ministerial Council meeting Like the Brussels Edition? 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