Germany says Greece needs debt relief and restructuring?
Germany conceded on Thursday last that Greece would need some debt restructuring as part of any new loan programme to make its economy viable as the Greek cabinet raced to finalise reform proposals to avert an imminent economic meltdown.
The admission by German Finance Minister Wolfgang Schaeuble came hours before a midnight deadline for Athens to submit a reform plan meant to convince European partners to give it another loan to save it from a possible exit from the euro.
Greece has already had two bailouts worth 240 billion euros from the euro zone and the International Monetary Fund, but its economy has shrunk by a quarter, unemployment is more than 25 percent and one in two young people is out of work.
Schaeuble, who has made no secret of his scepticism about Greece’s fitness to remain in the currency area, told a conference in Frankfurt: “Debt sustainability is not feasible without a haircut and I think the IMF is correct in saying that.
But he added: “There cannot be a haircut because it would infringe the system of the European Union.”
He offered no solution to the conundrum, which implied that Greece’s debt problem might not be soluble within the euro zone.
But he did say there was limited scope for “reprofiling” Greek debt by extending loan maturities, shaving interest rates and lengthening a moratorium on debt service payments.
European Council President Donald Tusk, who will chair an emergency euro zone summit on Sunday to decide Greece’s fate, joined growing international calls for Athens to be granted some form of debt relief as part of any new loan deal if Prime Minister Alexis Tsipras finally delivers convincing reforms.
Tsipras chaired a marathon cabinet meeting to finalise a package of tax hikes and pension reforms to send to euro zone authorities in a race to secure agreement at the weekend on a third financial rescue.
The leader of his junior coalition partner, Defence Minister Panos Kammenos, told reporters the Greek proposal had been approved by the cabinet and would be submitted shortly.
Tusk said a realistic proposal from Greece will have to be matched by an equally realistic proposal on debt sustainability from the creditors.
“Otherwise, we will continue the lethargic dance we have been dancing for the past five months,” he said.
Failure to reach a deal on Sunday, including releasing some money to enable Athens to cover debt service over the next few weeks could lead to a collapse of Greek banks next week.
If there is no agreement, all 28 European Union leaders will discuss measures to limit the damage from a Greek collapse, including humanitarian aid, possible border controls and steps to mitigate the impact on neighbours, EU officials said.
DRAGHI SAYS IT'S DOUBTFU?
Just how uncertain the coming days are was highlighted when
Albanian migrants weigh options in crisis-hit Greece
European Central Bank President Mario Draghi voiced highly unusual doubts about the chances of rescuing Greece.
Italian daily Il Sole 24 Ore quoted the ECB chief, under growing fire in Germany for keeping Greek banks afloat, as saying he was not sure a solution would be found for Greece and he did not believe Russia would come to Athens’ rescue.
Asked if a deal to save Greece could be wrapped up, Draghi said: “I don’t know, this time it’s really difficult.”
The ECB is keeping shuttered Greek banks afloat with emergency liquidity capped until the weekend.
Even France, Greece’s strongest supporter in the euro zone, acknowledged it was working on scenarios for a Greek exit from the currency area if weekend efforts to clinch a deal fail.
Under the agreed timetable, the leftist Greek government, which formally applied on Wednesday for a three-year loan from the European Stability Mechanism bailout fund, has until midnight to present convincing, detailed reform proposals.
Having won a thumping referendum majority to reject the austerity terms of a previous bailout plan, fired his turbulent finance minister and secured support from opposition party leaders, Tsipras is in a stronger position to impose tough measures and face down resistance at home.
But in a sign of the some of the challenges he will face, the leader of the far-left wing of his Syriza party came out to denounce any imposition of harsh measures on Greeks.
“We don’t want add to the past two failed bailouts a third bailout of tough austerity which will not give any prospects for the country,” Energy Minister Panagiotis Lafazanis said.
According to Athens daily Kathimerini, Greece is planning a reform package worth 12 billion euros over two years, more than previously planned to offset a return to recession after months of difficult negotiations with creditors.
Instead of growing by 0.5% this year, months of uncertainty and almost two weeks of capital controls mean “there are estimates of a recession of about 3%”, Kathimerini said. Greece emerged only last year from a deep recession that shrank its economy by a quarter over six years.
Tougher measures may face resistance from the hard-left wing of Tsipras’ Syriza party and from his junior coalition partner, the right-wing nationalist Independent Greeks.
European officials told Reuters on Wednesday that some large Greek banks may have to be shut and taken over by stronger rivals as part of a restructuring of the sector that would follow any bailout of the country.
One official said Greece’s four big banks – National Bank of Greece, Eurobank, Piraeus and Alpha Bank – could be reduced to just two, a measure that would doubtless encounter fierce resistance in Athens.
German Bundesbank chief Jens Weidman said capital controls should remain in force in Greece until there was any deal, and that the ECB should not increase its liquidity assistance for Greek banks, without which they may collapse next week.
MEANWHILE LATER ON:-
Tsipras submits new plan to bailout monitors
(Right photo) Euclid Tsakalotos, the new Greek finance minister, (right) with prime minister Alexis Tsipras and left German Chancellor Angela Merkel with Greek Prime Minister Alexis Tsipras.
The Greek government submitted its highly anticipated plan for the country’s economic overhaul to bailout authorities on Thursday night amid signs that Alexis Tsipras, prime minister, was facing resistance to the proposal by some of the more radical elements in his own party
The submission is part of a request for a new three-year bailout that Mr Tsipras must agree by the weekend in order to avoid a collapse of Greece’s banking sector that would probably see the country crashing out of the EU’s common currency.
The new reform plan was approved by Mr Tsipras’ cabinet just hours before a midnight on Thursday deadline, but not before some far-left members of his governing Syriza party raised objections that the plan crossed “red lines”. Greek media reported that Mr Tsipras told his cabinet: “We are ready to compromise.”
The submission opens a razor-thin 48-hour window in which Greece’s bailout monitoring institutions must evaluate the plan before it is turned over to eurozone finance ministers on Saturday. They will then decide whether it is sufficient to launch negotiations on a third bailout, which officials said could cost more than €70bn.
“[It is] important for [the] institutions to consider these in their assessment,” a spokesman for Jeroen Dijsselbloem, the Dutch finance minister who chairs the eurogroup of his 18 counterparts, wrote on Twitter.
If finance ministers conclude on Saturday that Athens has not gone far enough, European leaders will gather the next day to make preparations for its exit from the euro.
In a copy of the submission obtained by the Financial Times, Euclid Tsakalotos, the new Greek finance minister, vows to press ahead with several reforms — including pension reforms and tax increases — early next week, even before a final bailout agreement could be reached.
In a two-page letter accompanying the submission, Mr Tsakalotos said the quick passage of the reforms is intended “as a first element in a trust-building exercise with our partners”.
In many ways, the new reform proposal from Athens is similar in substance to a compromise offer made by creditors two weeks ago — and that was overwhelmingly rejected in a national referendum at the weekend. It includes an overhaul of the complicated value-added tax system — though it seeks to maintain special discounts for small, remote islands — and phases out the pension system’s “solidarity grant” to poorer pensioners by December 2019.
According to officials briefed on Greek plans, which includes a 12-page list of specific reforms, the new submission was compiled with the assistance of the European Commission and the French government. These two are leading a small camp of delegations trying to overcome a growing tide of scepticism and mistrust among eurozone governments.
Despite the assistance, officials involved in the talks said the proposal was mostly the work of Greek authorities, primarily George Chouliarakis, a deputy to Mr Tsakalotos who is widely considered a pragmatist by his eurozone counterparts.
Still, even before the proposal arrived in creditors’ in-boxes, there were signs that some eurozone governments were digging in their heels amid mounting distrust over whether Mr Tsipras will implement the reforms he promises.
Wolfgang Schäuble, Germany’s hardline finance minister, commended Mr Tsakalotos for his “more conventional” approach but urged Athens to start implementing reforms immediately, even before reaching an agreement on a new bailout, as a way of rebuilding trust between Athens and its eurozone partners.
“Just do it. That would win an incredible amount of trust,” Mr Schäuble said at a conference in Frankfurt.
In a sign Mr Tsipras could face stiff resistance at home, his Syriza party called a rare meeting of MPs at 8am Friday morning to weigh the proposal. Government officials said the plan – known as the bailout’s “prior actions” because they are the specific reforms that must be implemented before receiving aid funding – would be presented to parliament late on Thursday night.
Parliament will be asked to sign off on the prior actions and give Mr Tsipras’ negotiators a mandate to negotiate based on the plan by Friday afternoon, officials said.
The US and the International Monetary Fund have been pressing eurozone governments to be more accommodating towards Athens and offer it debt relief, and Donald Tusk, the European Council president, said creditors should include some form of restructuring as part of the new bailout.
“I hope that today we will receive concrete and realistic proposals of reforms from Athens,” Mr Tusk said. “The realistic proposal from Greece will have to be matched by an equally realistic proposal on debt sustainability from the creditors. Only then will we have a win-win situation.”
But Mr Schäuble recounted a recent conversation with his US counterpart in which he suggested swapping debt-laden neighbours: “I offered my friend Jack Lew these days that we could take Puerto Rico into the eurozone if the US were willing to take Greece into the dollar union. He thought that was a joke.”
The realistic proposal from Greece will have to be matched by an equally realistic proposal on debt sustainability from the creditors. Only then will we have a win-win situation
Valdis Dombrovskis, the European Commission vice-president overseeing its response to the Greek crisis, said “there is some willingness to look at this issue” in the bloc. Debt relief was unlikely to come in the form of a “haircut”, however, and more likely via an extension of the timeframe in which Greece would have to repay its debts to fellow eurozone members.
But Mr Schäuble said the leeway for further debt relief for Greece — after a restructuring in 2012 — was “very low”.
Michel Sapin, France’s finance minister, urged his eurozone counterparts not to underestimate the costs of Grexit.
“What’s costlier? That Greece exits the eurozone and defaults on all its debt? Asking the question is answering it,” Mr Sapin told Radio Classique on Thursday. “A deal is the best solution for Greece and Europe.”
“Greek banks have been closed for more than a week. Greece is already in a pre-chaos state,” he said. “How will history judge us?”
Posters in Canada telling the Irish to go home have been spotted in Toronto?
A campaign to get Irish people to leave Canada is generating quite a bit of controversy across the water and it’s not hard to see why.
Posters bearing the message ‘Go Home Irish’ have been placed in strategic places around Toronto. There’s also an address for a site called ‘pleaseleavecanada.com’.
But this isn’t because of any anti-Irish sentiment among our Canadian friends – it’s the brainchild of a Dublin advertising agency who wants to get our expats to come home.
“We are looking to hire Irish people who have worked in other parts of the world. We’re not anti-emigration, but we’d love to lure some of these internationally seasoned brains back home by pretending to be Anti-Irish-Canadians.”
The Social House say that they believe that it’s time for all those who’ve emigrated to come home as there are new job opportunities springing up in Dublin (what about the rest of the country?).
“We’ve been abroad ourselves. We know the pull of home but the fear that you may have to compromise on your career to come back. It can seem from the outside that Dublin doesn’t offer as good an opportunity as somewhere like New York, London, Sydney, or Toronto.
“But Dublin’s finding its feet again as a creative city, and we’re working hard to mess with the system and get make advertising more fun.”
Typing in ‘pleaseleavecanada.com’ brings you to the Social House website where you will see the following recruitment ad.
Shockingly (or not), the ads have been getting a mixed response, with a number of people complaining that they will create tension between the Irish and Canadians, as many will think they’re real.
Hmm, it’s a risky move. Let’s see how it works out.
Average cost of Ireland’s GP’s private fees now varies from €39 to €55
THE AVERAGE PRIVATE FEE TO SEE A GP IN IRELAND IS €50 A VISIT.
The cost of seeing a GP varies from €39 to €55 across the country, a new survey has revealed.
It is cheapest in Co Leitrim and dearest in Dublin, the survey of 670 GP clinics reveals.
It comes as GPs who signed a new HSE contract to see all children aged under six for free, will no longer be able to charge them a private fee and will receive an annual State capitation fee of €125 instead.
The average private fee to see a GP is €50 a visit, the survey by WhatCinic.com showed.
A similar survey in 2013 showed a 2pc increase in the national average private fee.
More than three-quarters of the GPs surveyed had signed up for the under-sixes scheme but nine out of 10 “thought it was a bad idea”.
A separate poll of parents found they averaged 3.5 GP visits per child annually. But families with babies under the age of 12 months could see their doctor 12 times a year.
Nearly one-fifth of parents said there were times when children had ear and throat infections where they could have to see a doctor four times a month.
Emily Ross, director of WhatClinic.com said: “The majority of families polled visited their GPs between two and five times a year per child with an average of 3.5 visits a year How peak times are managed by GPs remains to be seen,” she added.
Ireland lands yet another broadband service,
IT’S PURELY BROADBAND?
Offering ‘up to’ 100Mbps of fibre broadband, Pure Telecom has just announced its new broadband-only plan, targeting €4.3m in revenues from 10,000 customers.
Called Purely Broadband, the service comes on the back of a trial that saw 400 people sign up, with the service making fibre broadband “available to customers who don’t have a landline”.
“Broadband has come a very long way in the last few years,” said Paul Connell, head of operations at Pure Telecom.
“The world has changed, and many people are seeking high-speed broadband and don’t have a telephone landline. The majority of the people we are targeting in this segment never had a landline because they have cable TV. We believe that this is one of the best customer-driven innovations yet and we expect that it will significantly disrupt the market.”
It’s quite the disruptive market to… disrupt.
IRISH BROADBAND
Yesterday we reported that a telco dispute over technical standards that held back 110,000 homes and businesses in Eircom’s fibre broadband footprint from being eligible for connectivity has been resolved.
This latest announcement is related, in that it originated from a €20m agreement between both Pure Telecom and Eircom Wholesale.
The partnership means Pure Telecom customers can connect to Eircom Wholesale’s high-speed fibre broadband, which offers speeds of up to 100Mbps to 1.2 million homes and businesses nationwide, a figure that represents approximately 50pc of the total premises in Ireland.
Last month, Eircom Wholesale claimed that by 2020 some 1.9m homes and businesses across Ireland – including 300,000 premises in rural communities – will have access to broadband future-proofed to 1Gbps and beyond.
Back in May, the joint venture between the ESB and Vodafone Ireland, called SIRO, was announced. This project is aiming to bring 1Gbps internet to homes and businesses across the country in the coming years.
BUSINESS PLANS
ESB recently revealed a new 35km dark-fibre network that will join both ends of the existing T50 that connects most data centres in Dublin.
In conjunction with the T50, the ESB Metro Express will create a perfect fibre ring, offering data centres and businesses a superior network with increased protection and security.
In non-consumer terms, Microsoft is thinking outside the box. The tech giant is contracting a number of fibre companies in Europe and Asia to help it lay a global subsea fibre network that will connect all of its data centres around the world. The network will connect Ballinspittle in Cork with the rest of the world.
Rising temperatures in our world are due to climate change and the latest threat to bumblebees
A new study shows how warming temperatures have caused bumblebee habitat to shrink in North America and Europe.
Bumblebees already have to contend with lethal infections, deadly pesticides and habitat loss due to agriculture and urban development. A new study shows they have another cause for worry: climate change.
Honeybees can’t smell flowers well amid pollution,
A study tells us?
Over the last century, warming temperatures have noticeably shrunk the areas where bumblebees live in North America and Europe, researchers report in Friday’s edition of the journal Science.
The overall effect of climate change is to “crush bumblebee species in a kind of climate vise,” said Jeremy Kerr, an ecologist at the University of Ottawa and lead author of the study.
Kerr and his colleagues examined more than 420,000 bumblebee museum specimens collected from 1901 to 2010. The specimens represented 67 species of bees that lived in North America and Europe. Using records of the year and location where each bee was gathered, the researchers mapped out the historic ranges of the pollinator populations.
To see how the ranges changed over time, they created maps for a baseline period of 1901 to 1974 and for three recent periods with higher global temperatures: 1975 to 1986, 1987 to 1998 and 1999 to 2010. They also examined the extreme high and low temperatures that bees faced in each of the periods.
Across both Europe and North America, the southern ranges for bumblebees moved northward by an average of 185 miles between 1901 and 2010, the researchers reported.
Social imbalances speed honeybee colony collapse.
Temperatures in these vacated zones all rose, though by different amounts in different areas over that time period, Kerr said. But it’s not just general warming that’s a problem – bumblebees are especially vulnerable to extreme heat events, which have become more frequent as a result of climate change.
“Bumblebee populations have disappeared during heat waves in places like southern Europe,” Kerr said. “Even though the average temperatures might not be terribly high, these transient but intense heat waves can sometimes push bumblebee species past conditions they can tolerate.”
As the southern end of their habitat became inhospitable, the habitable zone on the northern end should have expanded. For instance, the coldest temperatures bumblebees experienced between 1999 and 2010 were 4.5 degrees Fahrenheit (2.5 degrees Celsius) warmer than between 1901 and 1974.
However, the bees did not adapt by moving farther north, as butterflies and some other species have done, Kerr said.
Even bumblebees can ‘merge’ their memories.
Researchers investigated other possible explanations for the bumblebees’ shrinking range, like increased use of neonicotinoid pesticides and land-use change. Though both are grave threats to bee species, they aren’t responsible for the range losses seen in the study, researchers said. The intensity of land use is different in Canada than in northern Europe, but the invisible northern barrier was seen in both places, the researchers wrote. Also, bumblebee ranges started to contract before neonicotinoid pesticides were widely used, they noted.
The study authors said they weren’t sure why bumblebees had not settled in areas further north. It could be that they aren’t able to effectively set up new colonies, that they lack the appropriate plants to feed on, or that the timing of the plants flowering and the seasons changing doesn’t line up with when the bumblebees need to eat and reproduce, said Leif Richardson, an ecologist at the University of Vermont and one of the coauthors of the study.
Bumblebees are important pollinators of wild plants as well as of food crops. Other research has shown that the common Eastern bumblebee, for example, provides pollination services worth an average of $390 per acre of crops in areas where it is found.
As a result, bumblebee decline could have serious implications for both ecosystem function and food production, scientists said.
“It’s very alarming,” Richardson said. If humans continue to warm the climate, “it doesn’t look very good for bumblebees.”
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