Greece updates - April 12 , 2013 ...... Troika talks timed to coincide with latest Eurogroup Fin Min meetings ..... Greece unemployment crosses 27 percent as it lurches toward 30 percent .... Greece fir sales well under way - when does Germany come for Greece's gold ?

Greece news items......


http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_12/04/2013_493547

As Cyprus bailout is approved, Greece told to wrap up talks with troika quickly  Greek Finance Minister Yannis Stournaras (left) talks to his Irish counterpart, Michael Noonan (right), during meeting of eurozone finance ministers in Dublin on Friday. Greece came under strong pressure at a Eurogroup meeting in Dublin Friday to agree with the troika on the number of civil servants that will lose their jobs over the next two years. Eurozone finance ministers also approved a 10-billion-euro bailout for Cyprus, although several national parliaments, including the German one, still have to agree to the package. Kathimerini understands that Finance Minister Yannis Stournaras was pressured by a number of his colleagues, especially Germany’s Wolfgang Schaeuble, to settle the matter of the civil service overhaul as quickly as possible so that the next loan tranche of 2.8 billion euros, originally due in March, can be released as soon as possible. Alternate Finance Minister Christos Staikouras continued talks with the troika in Athens Friday and sources suggested that the two sides were close to an agreement on the number of public servants that would fired this year and next. In total, 25,000 people will be placed in a labor reserve or a mobility scheme, which will lead to 12,000 being made redundant by the end of 2014. It is likely that 2,000 of those will be sacked this year and 10,000 next year. Eurogroup president Jeroen Dijsselbloem warned that Greece also needs to speed up its efforts in two other key areas of its adjustment program. The Dutch finance minister said that Athens had to to complete the recapitalization of Greek banks as quickly as possible and to avoid the creation of a financing gap in its program. He said that as soon as the troika has completed its review, the Euro Working Group will meet to decide on the disbursal of the next tranche. Greece hopes this will happen before the end of the month. The head of the European Stability Mechanism, Klaus Regling, said that apart from March’s sub-tranche, Greece is also due to receive another 7.2 billion euros for the bank recapitalization program. Meanwhile, Cyprus is expected to receive its first bailout installment in May after eurozone finance ministers approved its loan terms. “The program will address the exceptional challenges that Cyprus is facing and restore the viability of the financial sector, with the view of restoring sustainable growth and sound public finances over the coming years,” the Eurogroup said in a statement, which called on Russia to reach an agreement with Nicosia over improved terms on an existing 2.5-billion-euro loan and outlined plans for international auditors to check whether anti-money laundering rules are being implemented on the island. It was also clarified Friday that reports suggesting Nicosia would ask for more financial assistance were wide of the mark. European Commission sources told Kathimerini that the Cypriot government had asked for technical assistance to help it absorb structural funds. Cypriot government spokesman Christos Stylianides said there was no question of a further haircut on deposits, despite the troika’s debt sustainability analysis showing that Nicosia could need a total of 23.5 billion euros by the end of 2016, rather than the 17 billion originally thought. “The 23.5 billion euros, which the European Commission assessment refers to, has already been acknowledged and evaluated in the final draft of the loan agreement, which is in the Eurogroup decision,” Stylianides said in Nicosia. European Economic and Monetary Affairs Commissioner Olli Rehn played down the larger figure in the debt sustainability analysis. “Whoever says that Cyprus’s financing needs have increased to 23 billion euros and that 10 billion is not enough is mixing apples and pears and ending up with orange juice,” he said. Rehn argued the 23.5 billion euros was “gross financing” that took into account “additional financial buffers to allow for unexpected fiscal developments.” He admitted that he could not predict if the economic contraction in Cyprus would be 10, 12.5 or 15 percent.

http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_12/04/2013_493562

Troika insists on swift sale of banks  Once recapitalized by the HFSF, lenders must find a buyer by September By Yiannis Papadoyiannis Greece’s creditors are asking the government to commit to selling any lenders to be recapitalized only by the bank support fund (HFSF) as soon as possible, according to sources. The representatives of the European Commission, the European Central Bank and the International Monetary Fund – known as the troika – are asking the Greek authorities to promise they will complete the procedures for the sale of those systemic banks to private investors by September. The Greek side is trying to avoid setting a clear deadline in order to maintain greater flexibility, or at least to get a year-end deadline. The ideal case for a swift transfer back to the private sector is Eurobank, if it fails to find private funds amounting to 10 percent of the share capital increase in the context of its recapitalization. Given its status as a 100 percent private bank, once it comes under the control of the Hellenic Financial Stability Fund, it should be easier to get a private investor to buy it. Eurobank officials have told Kathimerini that in the case that the 10 percent threshold is not reached, the first priority of its management will be to search for investors from the day after it is recapitalized, so as to become the first lender to be passed on to private interests. They add that the privatization of the bank in the fall would issue a strong message of optimism for the country and its credit system. However the troika is also applying pressure for the swift sale of National Bank, Greece’s biggest lender, in case it comes under the full control of the HFSF. In a message to the bank’s employees, National’s chief executive Alexandros Tourkolias stressed yesterday that the bank’s management is approaching the recap issue positively. A thorny point will be that of the price the banks will be sold at after being passed into the hands of the HFSF. The price will be considerably lower than the funds needed for their recap. The government’s agreement with its creditors had suggested that out of the 50 billion euros set aside for the bank recap, some 16 billion will be retrieved through the sale of the banks.

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Troika talks to resume on Friday as Eurogroup gets under way As Finance Minister Yannis Stournaras prepared to face his eurozone counterparts in Dublin on Friday, Alternate Finance Minister Christos Staikouras was to continue talks in Athens with troika envoys with the key focus on a contentious overhaul of the civil service. The talks on Friday were to resume at 3 p.m. after another long session of negotiations on Thursday when the two sides reportedly inched closer to an agreement in several areas. «The government and the troika are closer on all points of negotiation,» a ministry source said late on Thursday. Administrative Reform Minister Antonis Manitakis has been tasked with overseeing the downsizing of the civil service but, according to sources, he will withdraw and allow the coalition leaders to take over negotiations if troika envoys ask more of Greece than what it committed to in last year's loan agreement. Athens is hoping to be able to announce the outcome of negotiations with the troika by Tuesday. http://www.ekathimerini.com/4dcgi/_w_articles_wsite3_1_11/04/2013_493281 The shot heard in Cyprus By Nikos Konstandaras It is quite possible that one day Cyprus will be referred to as the point where the European Union experiment began to unravel. It is too early to know how this story ends, but in the past weeks we have seen centrifugal forces that would have been hard to imagine just a few months ago but are now driving events. The brutal breakup of the Cypriot economy, the revelation that those who wield influence in Europe do not care about the social and political cost of their decisions, set off reactions that are shaking the EU to its core. We are living through something like the movie cliche of the Mexican standoff, where three or more characters have each other in their gun sights, in a balance of terror, knowing that if one fires then all hell will break loose and no one can be sure of surviving. If, however, the first shot goes off, then everyone has to fire, in the hope that in the end he will be the one left standing. In the case of Greece and other countries receiving bailouts, despite all the tension no one fired. In Cyprus, whether out of stupidity or cynicism, Europe’s bosses wanted to show that they weren’t bluffing, and they used force where sensitivity and diplomacy were called for. The consequences are many. The troika’s handling of the issue undermined the concept of solidarity and equality among partners (just compare Ireland and Cyprus, for example), and also cast doubt on the security of bank deposits across the eurozone. Today’s EU leaders revealed also that inexperience does not get in the way of dogmatism. On Wednesday, the Commission reported “macroeconomic imbalances” in 13 member states (other than those already on support mechanisms). This confirms that few countries will ride out the crisis without damage, and it increases fears of the economic measures that will be taken and the political consequences that these will have. Insecurity, the lack of creative alternatives, and the certainty that great difficulties lie ahead have raised tensions among member states. We already have the North-South divide. Now small countries know also that the big ones will trample over them at will (and so little Luxembourg hastened to accede to the demand for greater transparency in its banking system). But the strong ones, too, are quarreling: France accuses Austria of hiding the identities of foreign depositors in its banks, while Austria, in turn, claims that Britain and the United States have rules that enable tax evasion and money laundering. A few days earlier, the United States urged Germany to loosen the reins of austerity, provoking Berlin’s ire. Every day, differences grow, insecurity increases. The shot heard in Cyprus has shaken Europe. If the continent’s leaders do not hasten to reaffirm that they will protect the EU, that they will protect its citizens, then the Union will be abandoned to endless strife. http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_11/04/2013_493289 Hundreds of properties destined for private operation By Vangelis Mandravelis Hundreds of state properties are about to enter the portfolio of the state privatization fund (TAIPED) in the coming days, constituting the first cluster of about 1,000 real estate assets the government intends to transfer to the fund by the end of 2013. The transfer to TAIPED has already been delayed by a few days. It was supposed to have taken place by the end of March, according to the bailout memorandum Greece signed with its international creditors. Among the 290 properties heading for privatization or private utilization, the most prominent is the complex that includes the Peace and Friendship Stadium in Piraeus. It covers some 500,000 square meters and is destined to turn into a commercial and recreational park. There is also a possibility it could be transformed into a new port for cruise ships unless another spot is found in Piraeus. Sources say that TAIPED might prefer the location to be used as a cruise ship docking point as that would boost the value of the property, although the final decision rests with the prime minister and the Cabinet. The group of properties transferred to TAIPED further includes real estate assets in Attica and in many other parts of the country. Among the high-profile ones are the old royal estate at Tatoi, northern Athens, Prasonisi island near Rhodes and the ski center at Kaimaktsalan in Macedonia. Finance Ministry officials place particular emphasis on properties used for commercial purposes (such as offices and stores) in central spots in Athens such as Syntagma, Kolonaki, Psyrri etc. Housing developments are also set to fetch significant returns as in the cases of undeveloped plots between Galatsi and Palaio Psychico in northern Athens. Properties in the areas of Megara, Ilion etc in western Attica will be privatized in order to be used for infrastructure projects as well as transport, construction and environmental projects. The properties outside Attica transferred to TAIPED include a significant group of assets in the prefecture of Pella in central Macedonia (plots on Mount Voras, at Agios Athanasios and Lake Vegoritida), in seaside areas of Halkidiki (the Monodendri Azapiko estate, plots at Kalandra, Posidi etc) and at Kavala (the Nea Iraklitsa estate). These properties are destined for tourism development in northern Greece. Plots in the eastern Peloponnese are also included, such as those at Ermioni, near the popular resorts of Porto Heli, Hydra and Spetses, and in the west of the peninsula at Kyllini, Zacharo in Ilia prefecture and Pylos in Messinia, primarily for the development of luxury tourism accommodation in those areas. http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_11/04/2013_493182 Greek unemployment hits new record of 27.2 pct in January [update] Greece’s unemployment rate increased to a record in January as the country’s economic downturn entered a sixth year. The seasonally adjusted rate rose to 27.2 percent from a revised 25.7 percent in December, the Athens-based Hellenic Statistical Authority said in an e-mailed statement Thursday. That’s the highest level since the agency began publishing monthly data in 2004. Greece is in another year of a recession amplified by austerity measures linked to bailouts from the European Union and the International Monetary Fund. Gross domestic product shrank 6.4 percent in 2012 and the European Commission forecasts it will contract 4.4 percent this year. A Finance Ministry official on April 8 forecast a 4.5 percent drop in GDP in 2013. “We’ll continue to have a deteriorating trend in the labor market, although the pace of deterioration is lower compared to the first half of the previous year,” said Nicholas Magginas, an economist at National Bank of Greece SA in Athens. “We’re not expecting more solid signs of improvement until the second quarter of this year, when tourism activity is expected to provide more support to the labor market.” Finance Minister Yannis Stournaras said in February that pre-bookings for the tourism season in the Greece were “very good,” and a Finance Ministry official said this week that tourism is expected to offset the impact of Cyprus’s banking crisis. The jobless rate for Greeks aged 15 to 24 was 59.3 percent, while the total female unemployment rate was 31.4 percent. The region with the highest unemployment rate was Epirus-western Macedonia, with 29.2 percent joblessness. The statistics agency started releasing the unemployment rate on a seasonally adjusted basis from January’s 2012 data. The figures are subject to revision. [Bloomberg] GUIDE