Germany: Greek euro exit is now possible, report says

 Germany is prepared to accept a Greek exit from the euro, the magazine Der Spiegel reported on Saturday.

"The German government considers a Eurozone exit by Greece to be almost inevitable if opposition leader Alexis Tsipras leads the government after the election and abandons budgetary discipline and does not repay the country's debts," Der Spiegel reported on its website, citing unnamed government sources.

Tspiras’ radical left coalition SYRIZA is the most likely winner of the upcoming elections on Jan. 25, according to the polls. SYRIZA has strongly criticized the unpopular austerity measures imposed by the terms of the bailouts that the Greek government accepted in 2010 and 2012.

The German government had considered a Greek exit from the euro in 2012, but ultimately rejected the idea out of concerns for the threat it would pose to the entire European Monetary System. There was a danger that "contagion," or credit risk, would spread to other EU nations, like Spain and Ireland and Portugal, which were also struggling with financial crisis at that time.

According to the report, the German government believes that reformed financial regulations in the EU will ring-fence Greece, and control contagion risk.

The German government has neither confirmed nor denied Der Spiegel’s story on Sunday.

" Greece has fulfilled its obligations in the past. The federal government assumes that Greece will continue to meet its obligations,” government spokesman Georg Streiter said in a brief statement to German media.

The years of austerity imposed by the bailout programs have soured sentiment against the coalition government of the New Democracy and Panhellenic Socialist Movement political parties. The coalition has cut wages and social services, increased taxes and laid off public sector workers.

Germany’s opposition Left Party has blamed Chancellor Merkel’s coalition government for deliberately triggering crisis and instability in Greece ahead of elections on Jan 25.

The Left Party’s co-chairman Bernd Riexinger described the move as “lighting a bomb.”

“Greece would be destabilized ahead of the elections with such open blackmail in public,” Riexinger said. He warned that following speculation in the press, Greek citizens might rush to the banks.
www.aa.com.tr/en
4/1/15
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EU politicians not unanimous over Ukraine's future after parliamentary elections

German government considers those elections an important step towards stability, whereas an Italian politician and journalist Giulietto Chiesa believes that stability in Ukraine is still very far away ...


MOSCOW, October 27. /TASS/. Ukraine’s newly-elected parliament is unlikely to restore Ukraine to stability, Italian politician and journalist, Giulietto Chiesa, has told TASS.
“Stability is still very far away. Apparently, after the elections the prevailing presence of right-wing parties inside the Verkhovna Rada will be used as a pretext for an offensive (against Donetsk and Luhansk regions),” Chiesa said.

He voiced the fear that Ukrainian politicians will be inviting pro-Western forces to join the conflict. “There is Poland and there are the Baltic republics. Apparently, there are people who may be preparing all this,” he said.

Chiesa sees the United States as the main actor in the Ukrainian conflict. “It has engineered the crisis in Ukraine to provoke Russia. It has used Ukraine as a big stick in order to break Russia,” he believes. “The aim has not been achieved yet, so it will be moving further on. I have the impression that the US leadership is determined to stop at nothing.”
A solution of the Ukrainian crisis may be achieved “only if Europe develops the awareness of the danger looming over it, because it would be an operation not just against Russia, but against Europe as well.” 

On the other hand, “there will be no stopping the Americans as long as Europe fails to offer a different response.”
Chiesa said, however, that the West was no longer unanimous in its attitude to the Ukrainian crisis and in Europe there were tangible forces eager to cooperate with Russia.
For instance, “practically all leading companies in Italy are against anti-Russian sanctions.” “The Italian government is moving in one direction, while the business people proceed along a very different road,” he added.

Ukraine elections results “important step towards stabilization”

Germany’s government considers an apparently sweeping victory for Ukrainian pro-Europe parties in Sunday's parliamentary elections as “an important step towards stabilization” of the country, government spokesman Steffen Seibert said in Berlin on Monday.
The vote showed people’s trust in President Petro Poroshenko and Prime Minister Arseniy Yatsenyuk, Seibert said, noting that Ukrainian citizens explicitly voted for a new start without extremist or populist presence in the government.
Seibert expressed regret that the vote did not take place in every part of the country's east and called on Russia to influence people’s militia in order to ensure that the planned local elections in Ukraine’s eastern regions can be carried out in accordance with Ukrainian laws and under international supervision. 

Russia hopes the new government will work for the interests of the people

Russia hopes that the new government of Ukraine will launch nationwide dialogue in line with the Minsk agreements, Russian Foreign Minister added.
“We presume that the government will also pay attention to its commitments under the Minsk agreements, such as launching a broad nationwide dialogue involving all the regions, political forces of the country to carry out a constitutional reform that has been promised a long time ago but has not still begun,” Lavrov stressed.
Moscow also hopes that the new Ukrainian government’s efforts will be aimed at working for the interests of the country’s people, Russian Foreign Minister told TASS.
“We wait for the final results. We hope that the election of the new Verkhovna Rada will make it operatively form the government, which will not be aimed at continuing heightening confrontation moods in the society and in Russia but which will be constructive and directed at working with Russia that is indispensable to meet the interests of the Ukrainian people,” Lavrov said.
“Particularly, the solution of social and economic problems and the implementation of the Minsk agreements, which in addition to the ceasefire and the disengagement of the parties, the withdrawal of heavy weaponry, envision priority attention to humanitarian problems in Donbass and mobilizing efforts for the restoration of the economy and infrastructure in the south-east,” he concluded. 

People’s Front leading in parliamentary polls in Ukraine

Ukrainian Prime Minister Arseniy Yatsenyuk’s People’s Front is leading the elections to the Ukrainian parliament, the Verkhovna Rada, with 21.58%.
A total of 60.2% of data from polling stations have been handled.
The Petro Poroshenko Bloc party is the second with 21.41%.
The Samopomich (Self-Help) party headed by mayor of Lviv Andriy Sadovy comes third getting 11.16%. The Opposition Bloc led by Yuriy Boyko has 9.92%, Oleh Lyashko’s Radical Party has 7.35% and the Batkivshchyna (Fatherland) party of former Prime Minister Yulia Tymoshenko has 5.64%.
Voting turnout in the early parliamentary elections reached 52.42%. In 2012 the turnout was 57.98%.
http://en.itar-tass.com/world/756784
27/10/14
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Bulgarian authorities see illegal attempts to destabilize banking system

Bulgarian authorities on Friday saw illegal attempts to destabilize country's banking system amid queues of people trying to withdraw their money from cash desks....

Bulgarian Interior Minister Tsvetlin Yovchev told reporters that there has been an attack through the Internet and text messages via mobile phones to massively disturb people.

"We have found malicious and deliberate attempts to destabilize the banking system, and an investigation has been carried out in this direction since yesterday," Yovchev said.

This is an extremely serious crime and people who engage in such activity will suffer severe punishment, he added.

Meanwhile, Ivan Iskrov, governor of the Bulgarian National Bank (BNB) said in a statement that Bulgarian banking system has a good performance and is functioning smoothly, but in the last days an attempt is made to destabilize the country through organized attack on Bulgarian banks without any reason.

"Such criminal acts are directly directed against the savings of every Bulgarian citizen and against financial stability as an essential element of national security," he said.

BNB explicitly states that it will use all its means and resources to ensure people's savings, Iskrov said.

In turn, Bulgarian President Rosen Plevneliev "strongly condemned sustained efforts to destabilize the banking system" and urged citizens "not to succumb to rumors and speculation."

"Bulgarian banking system is well capitalized and regulated and enjoys the trust of international markets," he said according to a press release sent by his press office.
Source:Xinhua - globaltimes.cn
28/6/14
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Banking union made easy: a five-minute guide to the EU's new rules

A banking union is being set up by the EU to help keep Europe's financial system stable and prevent another crisis from taking place. It requires finding a fast and efficient way to deal with failing banks while ensuring that taxpayers are spared from paying for bankers' mistakes. As MEPs prepare to vote on 15 April on an agreement with the Council on how to deal with failing banks, we take a closer look at the issues involved. Read on for an overview of how banking in Europe is about to change.


The key ingredients for a banking union

An efficient banking union requires legislation on how to deal with failing banks, protect small depositors and better supervise banks.

Why states keep bailing out failing banks...

Because banks are at the heart of the economy, drawing in deposits, savings and financing investments, their health is of paramount importance. If they get into serious trouble, governments usually opt to bail them out with taxpayers’ money, even if that means a sharp increase in public debt, rather than risk economic meltdown in the wake of bank failures.

...And how to prevent this from happening again

Banking legislation is being reformed in order to prevent countries from using taxpayers' money to shore up failing banks. On 15 April MEPs vote on a deal that would enable authorities to quickly deal with failing banks. For this they would be able to rely on a €55 billion bank-financed fund rather than resorting to taxpayers' money.  Most importantly, bank losses will have to be borne mostly by shareholders and bondholders, giving them more incentive to  protect taxpayers and control bankers' risk taking..

Protecting people's savings

In order to safeguard people’s savings, MEPs will also vote on 15 April on an update of the deposit guarantee scheme directive, which introduces national bank-financed guarantees for savings up to €100,000.

Deposit guarantee schemes are being managed at the national level instead of at the European level.

Better supervision of banks

The Parliament  already supported the establishment of a single supervisory mechanism back in September 2013. This gives the European central bank (ECB) the responsibility to supervise the euro zone’s biggest banks. This will help to identify problems sooner and take care of them efficiently.

Other improvements

The EU also adopted legislation to limit banker bonuses in order to discourage them from taking excessive risks that could take down a bank.

Banks are now also required to hold sufficient capital in order to weather financial difficulties.
 [europarl.europa.eu]
14/4/14

EU is aware that Ukrainian economy is in really terrible shape. - analyst

The European Commission has proposed another 1 billion euro for Kiev, which will come as a part of the 11 billion euro package agreed earlier in March. A rapidly worsening balance-of-payments and weak fiscal situation in the wake of the latest developments in Ukraine pushed the EU to consider a new perk. The Voice of Russia talked to Lilit Gevorgyan is a Russia/CIS country analyst with IHS Global Insight and Jane's Information Group.

How can this financial aid change the situation in Ukraine? In your opinion, will it somehow help to stabilize the country’s economy?

If we look at what the Ukrainian economy is really suffering from and what it needs at the moment, it basically needs to finance its current account deficit and its budget deficit. And indeed, with the IMF and the EU bailout these goals can be achieved.

But there is another side to this story and that is the impact on the economic performance of the bailout program. And that in the short-term could be negative because what we are really looking into is a range of austerity measures that Ukraine would have to implement.

And that means that private consumption that has been the major contributor to the Ukrainian economic performance in the past quarters, it will weaken and, possibly, contract having an overall negative impact on the GDP.

• Does it mean that Ukraine will be more dependent on the EU? Because any additional aid to Ukraine from the European leaders automatically increases the country’s debt. And does that mean that Ukraine will have to follow the EU’s line of policy on the international stage?

• I don’t think that the EU bailout money will come with political strings attached. I believe that the European block is aware that the Ukrainian economy is in a really terrible shape and is facing serious problems with its external financing need.

And what the EU and the IMF are trying to do is to pull together their resources to help. To first of all stabilize the economic situation, help Ukraine to meet its debt obligations so that the country avoids a default and also help them to rebalance the economy, which is the most painful part that Ukraine has to go through, unfortunately.

When it comes to expecting Ukraine to behave in a certain way in foreign policy, I don’t think that that is necessarily the case.

How can the alliance between EU and Ukraine affect the Russian-Ukrainian economic ties?

I think from Russia’s economic and commercial perspective, it is quite interested in seeing the Ukrainian economy stabilizing. Russia is the major trading partner for Ukraine. It is the major investor in the country. There are vast business interests of the Russian businesses in Ukraine.

So, obviously, when the Ukrainian economy is underperforming or failing, it is having an impact on Russia as well. If the EU is helping the Ukrainian economy to stabilize, I don’t see why it will have a negative impact on the Ukrainian-Russian relations.

What are your forecasts for the further development of the economic situation in Ukraine?

As I said earlier, I think what we are currently seeing is the IMF continuing the negotiations. Clearly, these are difficult negotiations, because the Ukrainian Government is aware that the austerity measures that they have to implement will have a significant impact on their popularity and overall stability of the Government.

The IMF and the EU have made it clear that they will start seriously implementing the aid and rolling out a bailout only after the May’s presidential elections. They need some political stability and, secondly, they need seriously commitments by the new Ukrainian authorities that they will stick to these austerity measures, because, effectively, what they are asking for is increasing gas prices, cutting the public spending, trimming pension payouts and also maintaining flexible exchange rate for hryvnia.

All of these are going to take toll on households. And once the Ukrainians are going to experience a serious drop in their disposable income, this will naturally feed into an already tense situation in the country, particularly in the eastern regions of the country, where people could say that they didn’t even agree to a Government change.

So, it is a really toxic combination of austerity measures that have to be implemented to really rebalance the economy and keep Ukraine away from default and political instability. I think Ukraine is quite unfortunate in the sense that while this is a pill that they have to swallow because it is important for them, it is a very bitter pill and it could turn poisonous politically.

So, we are looking into a protracted period of political instability and economic instability in Ukraine for the next year or year and a half, at least. And also, depending on how they will build their relations with Russia, it will also have an impact on their economy. If there is a continued antagonism in Ukrainian-Russian relations, this could only lead to further difficulties with trade with Russia – potential trade restrictions, potential increasing gas prices and so forth. All of this could make Ukraine even worse-performing than we’ve seen before.

So, there are lots of challenges that the Ukrainian Government and the new authorities have to deal with. And another drawback for them is that it is a coalition Government that has a strong nationalist element, who are populists and quite possibly in the future they could turn their back the Government that is implementing austerity measures, and lead to more political instability with Ukraine experiencing the fate of many countries that have governments that are grouped with instability.

So, the picture doesn’t really look that great, to be honest. But the Ukrainian Government has face up to the mismanagement of the previous Government in the economy. And they really have to be brave to face these challenges and push ahead with them no matter what political cost is for their careers.
Read more: http://voiceofrussia.com/news/2014_03_21/EU-is-aware-that-Ukrainian-economy-is-in-really-terrible-shape-analyst-9389/
21/3/14
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• Ukraine: ce que prépare pour les travailleurs le régime soutenu par l’Occident

Ten years since the signature of the Treaty of Athens

Ten years ago, on April 16, 2003, the Treaty of Accession to the European Union of 10 European countries – the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovenia and Slovakia – was signed in Athens. This historical event took place during the Greek Presidency of the Council of the European Union and is enshrined forever as one of the most important documents of the reunited Europe.Later, on May 1, 2004, all our countries became fully fledged members of the reunified European family comprising 25 member states at that time. It was the largest single expansion since the Paris Treaty of 1951, the forerunner of the EU, in terms of population, number of states and territory.
Moreover, it was the symbolic completion of the vital strategic goal of all the acceding member states to finally put an end to the post-World War II period by returning to the common space of freedom and stability, democracy and prosperity. The signature of the Treaty of Athens opened a new era for the acceding countries, for their citizens and ultimately for the whole of Europe.

Ten years after the signature, as members of the European Union, we all can state that it was the right decision. This was the overwhelming choice by the people. It was not only based on the perspective of future benefits of the common economic area, or the single market offering free movement of capital, goods and people; it was also founded on the understanding of inevitable internal structural reforms that had been carried out along the integration path toward the European Union.The 2004 EU enlargement would not have been feasible without the strong and sincere support of all EU member states. The prospects of EU membership acted as a catalyst and the main driving force for positive changes in the social climate, economic growth, better living standards, higher incomes, more jobs and more development. However, among the most important aspects of this change was the hope to share and enjoy those European values that our societies had missed for so long. Our citizens, the real players in establishing the foundation for societies, made it possible for all 10 new EU member states to have a successful journey. Today, they continue to serve as an example and motivation for those candidates who wish to join the EU in the future.As an inseparable part of the EU, we contribute to strengthening the European project, to keeping its values alive and to spreading them in our neighborhood in the East and the South. Moreover, all 10 members actively participate in the shaping of European policies, and seek to make the EU more competitive and technologically and innovatively more advanced. They contribute to making the Union better prepared for future challenges in the current globalized world as an active player in dynamic international affairs. Above all, the main task to be addressed is to ensure that the EU continues to be a reliable and safe place to live in. If necessary, all member states have to offer solidarity based on the genuine efforts of all of us to show the necessary responsibility for the benefit of the whole EU.Looking back at those events 10 years ago, one is struck how appropriately the Greek EU Presidency chose the venue for the solemn act of signature by heads of states, prime ministers and foreign ministers from all the member states. It took place in the Stoa of Attalos at the Ancient Agora of Athens, in the cradle of democracy that the Athenian philosophers developed in ancient Greece. Democracy still prevails as the best form of government, offering guarantees for free and open societies and nations.As such, the Treaty of Accession to the European Union in Athens of these 10 European countries remains a symbol of the heritage of democracy being extended from the very place where it was born.Hana Sevcikova, Ambassador of the Czech RepublicAndres Talvik, Ambassador of EstoniaJoseph Joseph, Ambassador of CyprusIvars Pundurs, Ambassador of LatviaAlfonsas Eidintas, Ambassador of LithuaniaEszter Sandorfi, Ambassador of HungaryWalter Balzan, Ambassador of MaltaMaciej Krych, Ambassador of PolandRobert Basej, Ambassador of SloveniaPeter Michalko, Ambassador of Slovakia
 .ekathimerini.com