The paper clip, 29 July

The Spanish papers, including El País, report on a bomb attack on a police barracks in Burgos, Spain, in which four people died and 30 were injured. Frankfurter Allgemeine Zeitung, Süddeutsche Zeitung, Libération and Le Figaro are among the foreign papers with reports.

Two British hostages captured in Baghdad in 2007 are “very likely” to be dead, according to the UK foreign ministry. The hostages were part of a party of five kidnapped from the Iraqi finance ministry by men masquerading as Iraqi police officers. Earlier this year two bodies were recovered, but until now the others were thought to be alive. The fate of the fifth man remains unknown. Following the original report by the BBC, the online editions of the UK papers carry this story; see the Times and the Daily Telegraph for more.

Rzeczpospolita writes what it calls the most serious case of spying in Poland in recent years, dating to the end of April when Poland expelled two Russian military attaches, Aleksei Karasaev and Sergey Peresunko, for trying to find out more about plans for the placement the US's anti-missile shield in Poland, as well as other military secrets.

Handelsblatt carries an interview with Lucas Papademos, the vice-president of the European Central Bank, in which he says that the bank will not tolerate a rise in inflation and promises to react if there are signs of threats to price stability.

Today sees the last cabinet meeting in France before the summer break. The hottest item on the agenda is a proposed reform of the French postal service that has outraged unions. Libération reports that the reform would introduce a part-privatisation of the post office next year. Unions say it will lead to worse working conditions and poorer service. The draft legislation will be debated by parliament in September. Unions are planning a nationwide day of strikes and demonstrations the same month. Le Monde also has a report.

The other main item on ministers' agenda is a redrawing of electoral boundaries. Le Figaro has a report. (If you want to know where French ministers will go on holiday afterwards, go to Libération.)

The Times of London has decided that Nicolas Sarkozy is “not all that fond of being a Frenchman”. Rich in Anglo-Saxon clichés of France, the article cites Sarkozy's taste for jogging, cheese-free diet and that “he's actually jealous of Britain”.

La Libre Belgique has an interview with Guy Vanhengel, Belgium's new budget minister. Vanhengel says that the country faces a period of “austerity” owing to its projected budget deficit of €20 million in 2009 (equivalent to 6-7% of gross domestic product). He said that even achieving a balanced budget by 2015 would be “very, very, very, very, very, very difficult”.

Economics leads several front pages in Poland, with Gazeta Wyborcza writing about unemployment and Dziennik looks at the effects of the crisis within corporations.

Le Monde reports that Michel Rocard, the former French prime minister, has submitted his report on setting up a carbon tax. Rocard was commissioned by French President Nicolas Sarkozy to draw up plans for the tax, which Sarkozy has identified as a major priority for his government.

A commentator in Sme writes about a long-running scandal involving Slovakia's emissions trading allowance, writing: “Potential buyers want nothing to do with a state that sells its emissions quotas in a manner that leaves Ukraine looking like a model of anti-corruption efforts.”

The Financial Times reports that Ukrainian police have made their second breakthrough in days into an investigation into a murdered journalist whose death has “haunted the country for nearly a decade”. Questions about the involvement of Leonid Kuchma, president at the time, persist because of a recording of a voice like his calling for the journalist to be done away. A spokesman for Kuchma has said again that the former president had no role in the death and that he is “more interested than anyone” in the case being solved.

Wads of money, Swiss banks, dubious Czech businessmen and friendships with top politicians: together they make for another day of headlines in the Czech press. Lidové noviny has found that Roman Janoušek, whose deposit of 13 million francs (€8.5m) has prompted a Swiss investigation, is not just a friend of Pavel Bém, Prague's mayor and a former challenger for the post of leader of the Civic Democrats (ODS), but also traded with two men who have been at the centre of scandals involving Mirek Topolánek, the ODS's leader. None of which implicates either politician – but, in addition to rousing suspicions, it casts a sidelight on the rivalry between Topolánek and Bém: during a recent spat, Topolánek recently cast aspersions on Bém's relationship with Janoušek. In an accompanying commentary, the paper asks why the Czech police seem so reluctant to explore allegations of corruption.

The bad odour is strengthened by another Lidové noviny story, that Topolánek spent some of a recent holiday in Italy in the company of lobbyists.

In the UK, The Independent writes, in an article entitled “Windfall for Tories as firms eye contracts”, that “Britain's top accountancy firms are channelling resources and staff worth hundreds of thousands of pounds into the Conservative Party ahead of an anticipated Tory government after the general election”.

The latest opinion poll on the popularity of Germany's political parties gives Chancellor Angela Merkel's centre-right Christian Democrats (CDU) / Christian Social Union (CSU) parties 38% of the vote, Die Welt reports. The centre-left Social Democrats (SPD) lags behind on 23%, its worst poll result since the SPD chose Frank-Walter Steinmeier, Germany's foreign minister, as its candidate for chancellor in September's elections.

Germany's Social Democrats have had a terrible start to their campaign for the general election in September, writes Die Presse, after the Social Democratic health minister, Ulla Schmidt, had her official car stolen – in Alicante, Spain, where she spends the summer months on vacation. Several other ministers, all of whom happen to be Social Democrats, subsequently had to admit that they, too, were using their official vehicles during vacation – but of course only for official business.

Ivo Banac, a prominent scholar of the Balkans who teaches at Yale, tells Dnevni Avaz that the EU has no strategy in Bosnia and Herzegovina. “When we look a little more closely at what these people are doing – especially prominent figures like Carl Bildt – one has to clasp one's head in despair,” he says. Banac also says that Javier Solana, the EU's foreign policy chief, has done everything to reduce the role of the US in the Balkans.

Lidové noviny and other Czech papers report – rather briefly – on the death of Josef Lesák, the student leader at the forefront of resistance to the communist coup in Czechoslovakia in 1948. Lesák was subsequently sentenced to hard labour in the mines.

Frankfurter Allgemeine Zeitung reports that the EU's statistical office, Eurostat, has agreed that governments do not have to account for the cost of bank rescues in their public accounts, effectively reducing the effect of such measures on public deficits. The article says that the decision was taken by the standing statistics committee, at French insistence.

A Danish company, Vestas, goes to court today seeking to end the occupation of its Isle of Wight factory its employees, reports The Guardian. Around 20 workers are protesting about the imminent closure of the plant, which is the only significant wind-turbine factory in the UK. Hundreds of campaigners have arrived at the plant to support the workers, as the closure becomes an increasingly acrimonious battle about the future of the green economy in the UK.

FT Deutschland writes that Luxembourg-based steel giant ArcelorMittal made a $800 million loss in the second quarter of 2009.

Canadian-Austrian car parts maker Magna has moved a step closer to taking a stake in Opel, the European division of US car-maker General Motors, Frankfurter Allgemeine Zeitung. Süddeutsche Zeitung, on the other hand, reports that the process is not going so smoothly. FT Deutschland also carries a story focusing on problems with Magna's bid.

Süddeutsche Zeitung reports that shareholders in property investment bank Hypo Real Estate are suing the company for €200 million. As the bank was taken over by the German government after it got into difficulties the article notes that if the lawsuit is successful taxpayers will be liable for compensation.

Turkey's government is about to strengthen the rights of the country's Kurdish minority, writes Die Presse. Prime Minister Recep Tayyip Erdogan also plans to look into the brutal anti-insurgency campaign waged by Turkey's security forces, together with shadowy groups, in the 1980s and 1990s. The conflict claimed tens of thousands of lives.

Abdullah Abdullah, a former foreign minister, has emerged as the only credible challenger to President Hamid Karzai ahead of Afghanistan's presidential elections, scheduled for 20 August, writes the Tages-Anzeiger. While it is highly unlikely that dapper Dr. Abdullah will actually win, he may force Karzai into a second round. He will struggle to gain many votes among Afghanistan's Pashtuns, however, because he fought on the Tajik side during the civil war of the 1990s.

Libération reports that Air France has reported that one of its Airbus A320 planes suffered problems earlier this month with a speedometer.  Faulty speedometer readings have been advanced by some experts as the reason behind the crash of Air France Flight 447 on 1 June, which killed all 228 people on board. Flight 447 was also an Airbus. Le Figaro also has a report.

“We can't go on like this, something needs to be done:” that is how Antonio Tajani, European transport commissioner, describes the problem of lost luggage, Die Presse writes. However, a look at the figures paints a slightly less dramatic picture. One in 64 suitcases arrives with delay, but only one in several thousand disappears completely.