July 2nd, 2012
09:12 AM GMT
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How nice to start the week on an upbeat note. It would seem the markets rather liked the eurozone summit moves towards closer EU co-operation and agreeing to work towards fiscal union, albeit at some point in the probably distant future.

As well as a €120 billion package to boost growth, politicians have agreed on a “single supervisory mechanism” for eurozone banks, giving the ECB a wider role and which would allow the ESM bailout fund to recapitalize troubled banks directly.

Government borrowing costs fell for Ireland, Italy and Spain as the plans reduce their liability to bail out failing banks.

It is progress towards creating a banking union, but is unlikely to be a turning point or the “game changer” the Irish contingent at the summit hailed it to be. The scheme is sketchy, with no mention of a deposit guarantee scheme or a bank resolution authority and still does not address the fundamental problems the eurozone faces.

A rehabilitated banking system needs solid foundations and euroland is still on shaky ground. In short, the eurozone summit has not solved the debt crisis. But you probably did not need me to tell you that.

All eyes then are on Thursday’s ECB monthly meeting. With all the weak economic data out of the region, plus casual comments over the last few weeks, the markets are expecting a cut in official rates.

June 17th, 2012
02:32 PM GMT
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Athens (CNN) - Whichever way the Greek people vote in these elections, there are no easy options for the country. It is almost certain no one party will get a majority – even with the top-up seats given to the front runner.

We are facing days of horse-trading.

Voices of Greece

The best that can be hoped for is that the leaders of New Democracy and PASOK follow through on the noises they are making. That it is time for unity.

They know what that means. That they are going to have to get into coalition with each other. If they do that, Greece carries on.

However, even if these so-called “sensible parties” get into bed with each other, they will still want to renegotiate the deal with Europe.

Cafes buzz with political talk

Europe will not budge on issues such social security, pensions or privatizations. But they might be willing to talk on deficit targets and taxation levels, for example, given the difficulties created by the recession.

There are 1,001 ways that Greece can stay in the euro. But even if the austerity deal is renegotiated, the Greek people face another three to five years of pain.

June 12th, 2012
02:16 PM GMT
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Vienna, Austria (CNN) – It is shaping up to be an intriguing two days in Vienna. Ministers with some of the largest oil reserves in the world will gather Thursday to determine if the more than $25 slide in global energy prices requires urgent action.  Ahead of the ministerial meeting, they will meet with their counterparts from the private sector and air their views at the OPEC seminar Wednesday at the Hofburg Palace, before an audience of 1,200 energy executives.

Uprisings throughout North Africa - which shut down 90% of Libya's oil production for months - military exercises in the Strait of Hormuz, and rising demand from China kept markets on edge and drove prices higher last year and through the first quarter of 2012.

June 8th, 2012
07:36 PM GMT
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Madrid (CNN) – Spain: a country home to 47 million people and a $1.4 trillion economy. The Spanish bull has stood proud on Iberian hilltops for years, a symbol of force and a fitting tribute to a country which up until recently was the euro zone's fourth richest.

But step out of the Castilian plain and onto the bustling streets of Madrid – or any other Spanish city for that matter - and the skyline tells a different story.

The horizon is dotted with relics from the country's now burst property bubble.

Empty apartment blocks stand idle in the suburbs, while downtown the glass towers of Spain's financial district cast shadows over the people below and a shadow over their children's future.

May 31st, 2012
10:32 AM GMT
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(CNN) – Have you noticed the new trend when using debit and credit cards overseas?

We are now frequently being asked if we want to be charged in the local - or destination - currency or if we want to pay in my home currency instead.

Since the bill will eventually be converted to our home currency. I started to wonder the point of this. I knew there had to be a catch to it somewhere, but I couldn't quite work out where!

The tool being used is called Dynamic Currency Conversion and it allows an immediate translation into the final charge you will face in your own familiar currency. It will even print you a receipt with these details.

So why wouldn't everyone do this?

You've guessed it: The exchange rate you get with the converter is not the same as the one you would get should the charge go through the banking system to your home bank.

It may well have been set by the merchant, who now has the ability to change the rate, daily, hourly or whenever they want.

Even worse, the banks involved will probably be charging you a higher commission for the privilege of knowing how much you are paying, which may well be shared with merchant.

So what are the advantages? I know the final amount and I have a receipt detailing this which I can use for my expenses, already in my home currency.

But, since expenses software will usually do the exchange rate calculation for you, or I can submit my credit card bill to show the charge, this seems a fleeting benefit.

I put the two systems to the test recently. I made two withdrawals of CFH50 [$52.30] in Zurich. I chose one to be charged in local Swiss francs and the other in British pounds.

Two days later I compared both charges as they hit my account. In pounds, the conversion was £34.96, nine pence more expensive than taking out the local currency.

For nervous or inexperienced travellers there may be a comfort in having the certainty of knowledge. But I think it is a false security. If they knew they were paying more or getting less, I am pretty sure even the most anxious traveller would decide to keep their more of their own money for themselves.

Dynamic Currency Conversion seems to be just another way to charge us more  for the same service. For me, from now on....the rule will be always pay in the local currency.

May 23rd, 2012
02:12 PM GMT
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(CNN) – Fifteen months ago Tahrir Square was the site of a tsunami that swept President Hosni Mubarak and his entire government from office.

In the most populous country in the Middle East and North Africa, only the military apparatus has been left intact from the Mubarak era. The world is getting very familiar with the name and face of Field Marshal Hussein Tantawi, head of Egypt's ruling military council.

This week marks a historic opportunity to break from that past. There are a dozen candidates vying for the top job, a third of them labelled as front runners.

In geo-political circles, Egypt is described as a pivotal power, an emerging market economy and potential political power that can sway the outcome in the region.

April 17th, 2012
01:45 PM GMT
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CNN, Hong Kong - The World Bank race has been run and won – and no surprises for guessing the winner.

That was clear months ago when the U.S. backed Europe's nomination of Christine Lagarde for the top job at the International Monetary Fund. It ensured the Europeans would back the U.S. at the World Bank.

But the cozy days of you-scratch-my-back-if-I-scratch-yours are numbered. And not before time.

Former Nigerian finance minister Ngozi Okonjo-Iweala is claiming, if not victory, then success. Success in breaching the IMF-World Bank club for insiders. Never again will a European be chosen for the IMF or an American for the World Bank without a rigorous test based on merit.

Whether Mr Kim is the best or most qualified for the job will remain a debate. But what is clear is that Ngozo Okonjo-Iweala was equally well-equipped to lead the bank.

As the 21th century becomes increasingly a story of the developing world, the Bretton Woods institutions have been put on notice in clear terms: no more deal-making and a lot more transparency. Those days belong to an era when the U.S. and Europe ruled the economic world. Those days are coming to an end.

March 29th, 2012
06:17 PM GMT
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London (CNN) – I have a confession to make. I don’t like pasties - the rather dry, pastry-heavy snack causing tax troubles for the British government.

Finance minister George Osborne, in a clamp down on VAT avoidance, has decided the tax should now be charged on hot takeaway food. It was obvious from the moment the proposal was announced there would be problems. Buy a pasty, pie or cake and have it served hot - you pay VAT. Take it cold and you don’t.

While the bakers and pie eaters of Britain may be up in arms, anyone who has studied tax knows that these tricky intricacies are inevitable. They happen all the time, especially since snack taxes have been introduced in the U.S. to help prevent obesity. There are even learned journals and articles on the subject.


March 26th, 2012
01:23 PM GMT
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London (CNN) – I am frequently asked whether I get tired of traveling, all the hassles and difficulties that go with a life on the road. Obviously, sometimes it is physically exhausting, especially when flights are late and the descriptions of hotels are more enthusiastic than accurate. But I never really get tired of the magic and delight of a life on the road.

This has been very much in my mind as we start the new series of CNN Business Traveller.

Ten years after it first took to the air, it is legitimate perhaps to ask, what new there is to report? After all, the show has been to most parts of the world (not all - there are still some notable exceptions) and we have covered everything from the super commuter to traveling women and spent more hours than decent in planes, trains and automobiles.

The fact is there is a huge amount to bring to your screens since the last series ended a couple of years ago. The aftermath of the great recession has led to some significant changes in the past couple of years.


March 20th, 2012
06:12 PM GMT
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London (CNN) – For the airline industry, it seems barely does one crisis subside than the next rears up. No sooner has the European debt debacle gone to the back-burner - taking away one of the biggest threats to economic growth - than oil price rises become a concern. And it's a worry as big, if not bigger, than the debt crisis.

All the forecasts have been done on the basis of $99 to $100 per barrel of oil. Prices are now more than $120 for Brent and that is hitting airlines hard. For most airlines, more than 30% of revenues are now going on fuel. In some cases, it is the single biggest component.

Is oil the new Greece?

Tony Tyler, head of IATA, the organization representing aviation, describes airlines as “weak but still profitable.” With prices for oil having risen more than 30% he says airlines are suffering a “double hit.” As ticket prices go up, people travel less. There is a “hit to the revenue line and the cost side,” he notes.

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