Your browser version is outdated. We recommend that you update your browser to the latest version.

Germany votes to extend Greek bailout but backbenchers rebel against Merkel

Posted 27/02/2015

A sizable group from Angela Merkel's coalition voted no

The German parliament has voted to extend the Greek bailout for another four months.

A total of 542 members of the Bundestag voted in favour of the proposal with 32 against and 13 abstentions.

German Finance Minister Wolfgang Schäuble earlier urged his country's politicians to approve the bailout extension, saying it was no easy decision but necessary.

He asked politicians "not to reject the request by the finance ministry, which wasn't easy for me either, because this would do great harm to our people and our future."


Despite misgivings among some politicians, the Greek reprieve had been expected to easily pass the Bundestag lower house of parliament.
Chancellor Angela Merkel's left-right "grand coalition" has a commanding majority in the house and opposition parties had also signalled support.

Greece on Tuesday secured the four-month extension to its € 240 billion bailout after gruelling negotiations with creditors.

It averted a potentially calamitous end of February deadline that could have seen Athens face default, bankruptcy and ultimately an exit from the euro.


The new government of left-wing Prime Minister Alexis Tsipras published a list of proposed reforms focused on tackling tax evasion and corruption, as well as greater government efficiencies in order to unlock several billion euros left in the programme in the coming months.

"This is not about new billions for Greece," Mr Schäuble told parliamentarians this morning.

"This is not about changing the programme. This is about granting more time to successfully conclude this programme."

Fresh tensions emerged yesterday between Germany and Greece in the debate over Greece's debt of €320bn - equivalent to 175% of its annual economic output - and most of which is now owed to its European partners.

Greek Finance Minister Yanis Varoufakis this week again raised the issue of renegotiating Greece's debt mountain, prompting Mr Schäuble to express his "disbelief" that the idea had been mooted.

"The discussions before and after the elections in Greece didn't make this decision any easier, and neither have the discussions of the past few days and hours, to put it mildly," Mr Schäuble told lawmakers.

He reiterated that in requesting an extension, Greece also had to commit to sticking with its terms.

Mr Schäuble, 72, an inveterate pro-European, said help for Greece was necessary in a Europe guided by the principle of solidarity, a message often repeated by Ms Merkel.

Last night, dozens of protesters clashed with riot police in central Athens after an anti-government march, the first since the leftist Syriza party took power a month ago.

Around 450 protesters took to the streets against the newly-elected coalition government of Prime Minister Alexis Tsipras.

The Greek deal has triggered dissent within Mr Tsipras' own party and accusations by some on the hard left that the government is going back on pre-election promises, including to end a much-hated € 240 billion EU/IMF bailout programme.

After the march, about 50 anti-establishment protesters wearing hoods hurled petrol bombs and stones at police in Athens' central Exarchia district.

A small number of shop windows and bus stops were also smashed or damaged during the violence.

The incidents, albeit on a small scale, mark the first public disorder against the leftist government.

The new government was elected on 25 January on a promise to write off a chunk of the country's debt and end painful austerity, which has helped push one in four Greeks out of work. As the vote took place, Greek finance minister Yanis Varoufakis discussed the vague nature of the deal. The IMF has criticised the Greeks for not providing enough details. Mr Varoufakis says that he was deliberately abstruse when tabling the programme: "I use the term creative vagueness. I want to be the first minister of finance who will never refer to a number if I am not sure that I will attain it."


He also reiterated that he and his party have no desire to leave the euro zone - and that a Greek exit would be "catastrophic."



Syriza feels the squeeze – Climb down or U-Turn


Posted 19/02/2015

Greece has escalated the bailout row by saying the EU has two choices - to accept or reject its request for a six-month extension to its EU loan programme.

"Tomorrow's Eurogroup has just two choices. To accept or reject the Greek request. We will now discover who wants to find a solution, and who does not," a government source said after Germany snubbed the Athens proposal.

The message was addressed to German finance ministry spokesman Martin Jaeger, who had said the Greek offer - presented to Brussels earlier - "does not meet the criteria" laid out by euro zone ministers. European Commission President Jean-Claude Juncker's reaction was more positive, suggesting the euro zone was divided over what exactly needed to be promised by Greece to reach a much-needed compromise.


Mr Juncker "sees in this letter (from the Greek government) a positive sign which could pave the way for a reasonable compromise in the interest of financial stability in the euro area as a whole", his spokesman Margaritis Schinas told a news briefing.

Eurogroup head Jeroen Dijsselbloem said euro zone finance ministers would meet in Brussels tomorrow to consider the request by Athens to extend ithe European part of its programme, which expires at the end of the month.

Germany rejected a request by Greece for a six-month extension to its EU loan programme.

"The letter from Athens is not a substantial proposal for a solution," said Mr Jaeger, a spokesman for German Finance Minister Wolfgang Schaeuble.

"In truth it aims at bridge financing, without meeting the requirements of the programme. The letter does not meet the criteria agreed upon in the Eurogroup on Monday."


Earlier, the EU said a request by Greece to extend its bailout loan agreement with its European partners marks a big step towards achieving a much-needed compromise to end the row.

Greece formally asked the EU for a six-month loan extension, hoping to avoid default and draft a new deal with its creditors.

"Our proposition will be written in such a way that it will cover both the demands of the Greek side and the head of the Eurogroup," Greek Finance Minister Yanis Varoufakis told reporters yesterday.

Europe and Greece are racing to reach a deal to avoid a Greek exit from the eurozone, after talks in Brussels ended in acrimony on Monday with both sides digging in their heels.

The European phase of Greece's EU-IMF bailout expires on 28 February.German Finance Minister Wolfgang SchaeubleGerman Finance Minister Wolfgang Schaeuble

Athens needs to find €11.9bn for bond repayments to the IMF and the European Central Bank by August.

Greece is under mounting pressure to reach a deal to forestall a bank liquidity shortage and lasting damage to its fragile economic recovery.

The European Central Bank yesterday decided to extend and increase the amount of emergency liquidity available to Greek banks to € 68.3bn.

The decision to raise the ceiling by only € 3.3bn, however, was seen by analysts as pressure from the ECB for Athens to clinch a deal and reverse a rise in deposit outflows which could spark a funding crisis.

The new radical government of Prime Minister Alexis Tsipras that came to power last month wants to reverse many of the fiscal reform obligations tied to the EU-IMF rescue packages which have been keeping the country afloat since 2010.

The government has halted privatisations and promised to increase wages and roll back labour market reforms.

Minister for Finance Michael Noonan has said it seems that progress has been made in relation to Greece's loan programme.

He said he had not yet seen the Greek letter but he understood that it set out "some conditionality."

If a resolution can be found at tomorrow's finance ministers' meeting, he said the first step is that the Greek government and Greek banks remain solvent.

Then it would be a period of maybe four months where more detailed negotiations would take place to see if a fuller settlement could be arrived at.



Greece describes EU's offer as absurdRandall CalvinRandall Calvin


Posted 16/02/2015

By Randall Calvin

After a shorter than expected Eurogroup meeting held today in Brussels, the decision on Greek extension of current bailout programme remains uncertain. No agreement was reached and kicks the ball back to the Greek government whether to ask or not for such an extension by the end of the week.

During the press conference held following today’s Eurogroup meeting, Jeroen Dijsselbloem, President of the Eurogroup, remained firm on the preferred option for the Greeks: an extension of the current programme that ensures certain commitments from the Greek authorities, and that allows room for discussion on certain adjustments.


Pierre Moscovici, Commissioner in charge of Economic and Financial Affairs, Taxation and CustomsPierre Moscovici, Commissioner in charge of Economic and Financial Affairs, Taxation and CustomsNevertheless, Pierre Moscovici, Commissioner in charge of Economic and Financial Affairs, Taxation and Customs, was clear in his statement “we must use logic and not ideology” referring to the Greek demands.

Two days of technical discussions between the Greek government and the European Institutions have been insufficient to reach an agreement on the basis of the recovery plan for Greece. While the EU claims that Greece could agree on 70% of the plan, the remaining 30% is still pending. Despite a certain sense of disappointment of the talks, there is hope that the Greeks will accept an extension of the programme.


However, the EU is demanding certain commitments that Greek authorities might fear to implement in view of the democratic desires of its population to renegotiate a more fair and comprehensive package that would help them to pass the storm and more importantly that reflect their promises at the recent elections.

Yannis Varoufakis, Greek Finance Minister, explained in a national press conference organised immediately after said  “negotiations were conducted in a collegial spirit.” The intention was to establish common ground over the next 4-6 months and to extend the contract for growth between the EU, Greece and the IMF, in order to achieve a meaningful agreement for Greece and Europe.

“Disagreement today is mainly on the tasks ahead to complete the programme,” he said. Greeks were sitting today with a draft agreed between the European Commissioner, Pierre Moscovici, and the Greek president, Alexis Tsipras on the extension of the contract between Europe and the Greek government that would have democratic legitimacy with the Greek people, helping to alleviate its humanitarian crisis, supporting growth and employment and to stimulate economic recovery.

Yannis Varoufakis, Greek Finance MinisterYannis Varoufakis, Greek Finance Minister

For Varoufakis, the discussions ended in deadlock as the President of the Eurogroup decided to add the words “more flexibility”. For the Greek government it is critical to fulfil the main demands of the Greek electorate, while these two simple words may entail more than they seem to mean. 

Varoufakis is convinced that “nothing good in Europe has come from from an ultimatum,” quoting Schuman, and he expressed his concerns about the negative repercussion that this might have on European project.

Anti-Austerity protests however have not ceased, about 20,000 protesters rallied yesterday outside parliament in Athens on Sunday ahead of talks in Brussels to renegotiate the country’s bailout plan. Paris, Lisbon, Madrid and several Greek cities also participated in solidarity marches demanding Eurozone finance ministers in Brussels loosen their austerity policies.

While the newly elected Greek government has denied any involvement with Sunday's protests, it welcomed the rallies, which promote its platform of ending austerity, audits and pushing for a debt write-down.


Even when there was disagreement on the wording –not to mention confusion-, the Greek government requested a “bridging solution.”                  The European Institutions interpreted the request as a strong signal for carrying on with the current programme, however for Greece the discord is because of the addition of “more flexibility.”


Greece’s current 240 billion-euro bailout expires at the end of February, and there is very little room for manoeuvre. 

By forcing Greece’s hand on the extension of the current bail-out, Greek authorities will have certain flexibility to start discussions on amendments tailor-made for the country but keeping their commitments of repayment, however, enchantment with the current government could run very short followed by social and political unrest. On the other hand, if the Greek government decide to “agree to disagree” with the extension, something that eurocrats even fear to mention, the  consequences will be more than arbitrary, affecting not only the euro-zone but the main pillars of the European Union.

Under these circumstances, we can only hope for the best, that discussions finally reach an agreement which satisfy both Greeks and the EU as a whole. However the panorama looks grey, illustrated by the fact that today’s Eurogroup meeting was much shorter than expected, breaking up after less than 30 minutes in session, but we’ll have to wait till the end of the week to have a clearer glimpse of what the future holds for Greece.


By Randall Calvin



Patriot GamesRandall CalvinRandall Calvin


Ukraine – will the ceasefire hold?

Posted 13/02/2015

By Randall Calvin

Despite the enthusiasm among most EU leaders in Brussels last evening, there remained a healthy scepticism from others. UK Prime Minister David Cameron remarked, “If this is a genuine ceasefire – it would be welcome,” while the Lithuanian President said “we already had an agreement five months ago, so let’s see what happens now.” German Chancellor Angela Merkel called the agreement “a glimmer of hope.”

The European Union may impose further sanctions if a ceasefire deal sealed in Minsk between Ukraine and Russian-backed rebels is not fully implemented, German Chancellor Angela Merkel and French President Francois Hollande said after an EU summit in Brussels tonight.

Fresh from brokering a deal in Minsk between Russian President Vladimir Putin and Ukrainian President Petro Poroshenko,          Ms Merkel told a news conference that EU leaders had asked the European Commission to prepare further sanctions in case the ceasefire did not hold.

"We hold open the possibility, if these new agreements are not implemented, that we must take further measures," she said, adding that existing sanctions could only be lifted when the grounds that led to them are removed.

Like most EU leaders, the majority of EU citizens want to see tangible facts on the ground in the time ahead; before they get too carried away with the conditions of this latest ceasefire, tentative as it is, the optimism comes with a small ‘O.’

Mr Hollande echoed Ms Merkel’s words, saying if the Minsk deal is not respected "we would get back into the procedure... where sanctions would be added to the sanctions that are already in place."

The EU has already imposed sanctions on Russia and pro-Russian separatists in Crimea and eastern Ukraine, including visa bans and asset freezes on individuals as well as curbs on access to European capital markets, weapons and technology. 

Mr Hollande also said if the ceasefire is fully respected, however, sanctions would progressively be lifted.

Earlier, US Secretary of State John Kerry indicated that sanctions imposed on Russia could be eased if two accords designed to end the conflict in Ukraine are implemented.

In a written statement, Mr Kerry said, "We will judge the commitment of Russia and the separatists by their actions, not their words."

After a year of fighting in eastern-Ukraine what might be different this time around is that pro-Russian rebels have signed a deal that might help cement the agreement, including a menu of measures that include the handover of heavy weapons, and prisoner exchange, and an amnesty for fighters.

For me Vladimir Putin’s premier arguments’ never stood up to any form of rational or sane scrutiny. Notwithstanding the legacy issues between Mother Russia and the Ukraine, Crimea, naval access, and NATO - too damn close for comfort, and the flirtations from the EU with trade agreements. Vlad decided to offer, as a sole defence for his aggressive actions in the region, the fact that many people speak Russian in Ukraine, especially the Crimea - and so they do!



The Irish speak English, so why don’t the English invade the Irish Republic on that basis; Ireland has great ports and airports of strategic value, and they refuse to join NATO! Should the small Republic Emerald Isle not be punished? Indeed lets extend the analogy to the whole of the English-speaking world; the USA, Canada, Australia, New Zealand, South Africa…etc.

The last time I checked, the majority of South and Central Americans speak Spanish, the world’s third largest native language, after Chinese and English- so Spain has every right to reclaim her old colonies, by Vlad the Putin’s logic - of course. If you think I’m being absurd, that is why his actions were so accurately compared to the Sudetenland annexation of 1938; “German speaking peoples are being oppressed,” Adolf Hitler. 

Russia is proud, and so she should be, a land so rich in language and culture, but if I could only convey one sentiment to the modern Russian Tsar, I would say- you can’t repeat the experience of the Spanish or British Empires, they now relegated to history, nor will the world of 2015 allow you to indulge in your KGB fantasies.

And he lied to the whole world that Mother Russia was not giving arms to the pro-Russian separatists, besides a mountain of intelligence to the contrary.

As an ex-military person myself; allow me to throw just a little light on that little issue. Since the violence began; I noted that the small- to- medium arms the Ukrainian fighters were using were very late 1980’s; like fashion it stands out if you know your weapons - whereas the “we get nothing from Russia” brigade, had - shall we say – more modern weapons. Of course that could be explained by lack of investment and proves nothing in itself, but…

One wonders, when Yeltsin gave the reins of power to this man; Vlad the Tsar if he really knew what he was doing?

The ceasefire is to come into effect at midnight on Saturday the 14th of February, but dolefully we should remember that Putin longs for the Empire he never had, nor will he ever have.

The final plea that “Russia was treated badly after 1991” argument, has lost all political currency as an excuse as of now.


By Randall Calvin



Juncker Commission makes one billion euro available for the young unemployed


Posted 08/02/2015

This week the European Commission proposed to top up the Youth Employment Initiative to a total of one billion euro which will be available as from this year. The proposal aims at helping young people to enter the workforce faster. The programme will reach up to 650,000 young people and represents an increase of up to 30 times the current pre-financing that Member States receive to boost youth unemployment.

The proposal responds to the dramatic situation across Europe, where a new generation is trying to get a job to no avail.


Youth unemployment soared across the continent in the aftermath of the 2008 financial crisis and remains persistently high. The latest official figures estimate over 5 million people under 25 are unemployed across the European Union.

The panorama in Southern European countries is particularly depressing. According to EU data, youth unemployment is as high as 53.5 percent in Spain and 49.8 percent in Greece, in contrast to 7.4 percent in Germany and 9.4 percent in Austria.

The announcement this week is a step forward in the right direction. Valdis Dombrovskis, Vice-President for the Euro and Social Dialogue said: "With this proposal, the Commission sends a clear signal that youth employment continues to be high on our political agenda.

We will advance around one billion euro to support the work of Member States in helping to get young people back into work, to return to education or get a traineeship. In doing so, they are not only able to contribute to the economy and society through their skills and dynamism, but they also regain their dignity."

If the EU is to fulfil its promise of peace and prosperity, it will need to find ways to create opportunities for more of its citizens.                       Youth unemployment is a particularly serious concern, even in countries with otherwise positive employment statistics; in countries with worse labour-market conditions, it represents a potential source of social and political instability.

Participation in the workforce is linked not only to income levels, but also to self-esteem, social inclusion and social status.  Being left out of the labour market increases the risk of poverty and poor health and the longer unemployment lasts, the more damaging the effects.


Marianne Thyssen, Commissioner for Employment, Social Affairs, Skills and Labour MobilityMarianne Thyssen, Commissioner for Employment, Social Affairs, Skills and Labour Mobility

Marianne Thyssen, Commissioner for Employment, Social Affairs, Skills and Labour Mobility, commented: "Our young people need jobs and they need them now. It is unacceptable that today more than one young person out of five on the labour market cannot find a job. By making more funding available sooner, we can get more young people back to work: I am determined to make this happen."

The first priority of this Commission is to strengthen Europe's competitiveness, stimulate investment and create jobs. The 315 billion euro Investment Plan can create millions of new jobs – not least for young people. But even when new jobs are created it is often very difficult for young people to successfully enter the job market. This is why the Youth Employment Initiative (YEI) focuses particularly on getting young people back into work or training.



All Member States have committed to the "Youth Guarantee": to provide young people under 25 with a quality job offer, an apprenticeship or training within four months of leaving school or losing a job. Today's announcement will help make that guarantee a reality, in line with the Commission's commitment in its 2015 Work Programme.

This new increase in the Youth Employment Initiative pre-financing rate will range from 1-1.5% to up to 30%. Member States benefiting from this initiative could therefore receive a third of the 3.2 billion euro allocation immediately after the adoption of dedicated Operational Programmes. Member States are expected to make this funding available immediately to project beneficiaries through advance payments for projects, which will be closely monitored.

The objective of the increase is to speed up immediate support and will target between 350,000 and 650,000 young people in 2015; otherwise, at the current pre-financing rate, this figure would be between just 14,000 and 22,000 young people.

This legislative proposal will now be discussed by the European Parliament and the Council, who have to adopt it before it can enter into force.

This week at the Committee of the Regions, more than 150 young Europeans came together to discuss the future youth strategy of the European Union. They adopted 10 proposals to improve major issues such as youth employment, EU citizenship and sustainable development.

During this conference, young Europeans expressed the most salient and decisive matters for them: lack of jobs and concerns about youth unemployment; youth's disinterest in the EU politics and the polarisation of the EU citizenship; as well as young people's concerns about environmental degradation and short-term policies, in relation to the need for sustainable development and growth.

After a series of panel debates with high-level representatives from European institutions, academia and civil society, the participants drafted and voted upon their recommendations, which will inspire the consultative work of the Committee of the Regions and which will be shared with the other EU institutions.

Juncker’s proposal of topping up the Youth Employment Initiative is a glimpse of hope for many young Europeans, however it is a grain of sand in the overall youth unemployment figures of the continent. Even German Chancellor Angela Merkel admitted in June 2014 that the initiative was (back then) a failure.

One thing is clear, unless further efforts are adopted soon, Europe’s many unemployed young people risk becoming a lost generation. 





French President warns the alternative to peace in Ukraine 'is war'Guadalupe del OlmoGuadalupe del Olmo

Posted 07/02/2015

By Guadalupe del Olmo

The leaders of France and Germany will discuss the proposals on Sunday

German Chancellor Angela Merkel has said a bid to resolve the Ukrainian conflict is "uncertain but worth trying," as the French President warned it was "one of the last chances" for peace.

Speaking at a security conference in Munich, Mrs Merkel also said Russia "needs to its bit" to resolve the crisis. She accused Moscow of showing "territorial disrespect" for its neighbour, and said international law had been violated.

Mrs Merkel told the summit: "We want to shape security on Europe together with Russia not against Russia. It needs to do its bit in the Ukrainian crisis as well. This crisis cannot be resolved by military means."


Her comments come after she and the French President Francois Hollande met Russian leader Vladimir Putin in Moscow, in what was widely seen as a last-ditch attempt to thrash out a deal to end fighting which has claimed the lives of more than 5,300 people.

Mrs Merkel and Mr Hollande went to Moscow with a peace proposal discussed during a separate meeting with Ukrainian President Petro Poroshenko on Thursday.

Despite no major breakthrough in the negotiations, a Kremlin spokesman said Friday's talks were "substantial and constructive".

Mrs Merkel said of the peace efforts: "It is uncertain whether it will lead to success, but from my point of view and that of the French president (Francois Hollande) it is definitely worth trying. I believe we owe that much to those who are affected in Ukraine."


Mr Hollande told reporters: "I think this is one of the last chances, that's why we took this initiative. If we don't manage to find not just a compromise but a lasting peace agreement, we know perfectly well what the scenario will be. It has a name, it's called war."

Asked at the Munich talks whether he thought the peace proposal could work, Mr Poroshenko replied: "Yes."

Russia's Foreign Minister Sergei Lavrov, also at the Munich talks, said: "We believe that there are good grounds for optimism to issue recommendations for conflict resolution. It is important for everybody to realise the scale of the problem. The world is at a turning point."

Amid a debate in Washington over whether to send weapons to help the Kiev government fight pro-Russian rebels, the German Chancellor argued this would not help end the crisis. "There is already a large number of weapons in the region and I don't see that this has made a military solution more likely," she said.

Her comments were echoed by Germany's defence minister Ursula von der Leyen. "Are we sure that we would be improving the situation for the people in Ukraine by delivering weapons?" Mrs Von der Leyen asked the conference. "Are we really sure that Ukraine can win against the Russian military machine?" she added.


But NATO's top military commander has said this should not be ruled out. US Air Force General Philip Breedlove told reporters at the Munich conference: "I don't think we should preclude out of hand the possibility of the military option. The situation is worsening and we need to address the worsening situation. It is important that we use all the tools in the toolbox to address this." Ukraine is 'fighting for survival'.

NATO European MembersNATO European Members

Clashes between pro-Russian separatists and Ukrainian forces in the east of the country have escalated in recent weeks, despite a peace deal agreed in Minsk last September.

A spokesman for the Ukrainian military said five soldiers had been killed and 26 wounded in fighting in the last 24 hours alone.

He said separatists had stepped up shelling of government forces and appeared to be amassing for new offensives on the key railway town of Debaltseve and the coastal city of Mariupol.

There are also fears of a growing humanitarian crisis in the country.

The West accuses Russia of sending troops and weapons across the border although Moscow has consistently denied backing the rebels.

The talks came as rebels and Ukrainian troops briefly halted fighting in the embattled eastern town of Debaltseve to allow the evacuation of civilians.

Both sides sent convoys of buses into the town to rescue residents who have been trapped without power, heat or running water for two weeks. Rebel forces have encircled the town and are engaged in a violent battle for control with government troops. Debaltseve is a key railway hub between the two main rebel-controlled cities of Donetsk and Luhansk which are facing a major humanitarian crisis.

Fears that the conflict is spiralling out of control have prompted the US to consider supplying lethal weapons to Ukraine, an option opposed by European nations.

Speaking in Brussels, US Vice President Joe Biden said Ukraine was fighting for survival in the face of growing Russian military involvement.   "We, the US and Europe as a whole, have to stand with Ukraine at this moment," Mr Biden said. "Russia cannot be allowed to redraw the map of Europe" he added.

US Secretary of State John Kerry is set to meet Russia's Foreign Minister Sergei Lavrov at the conference this weekend.