The Troika trying to manage Greece’s path to normality – the European Union, European Central Bank and the International Monetary Fund – struck an upbeat tone as they broke out from meetings in Brussels Friday, but the reality is one of long lasting pain for the Hellenes with little progress after a five year austerity plan.
The Troika and the Greek Prime Minister George Papandreou are now at least singing from the same hymn sheet and the numbers look like this in the final package: $40 billion in higher taxes and cuts in spending until 2015. Privatisations have been put down to raise $72 billion and at late night Thursday the new Greek finance minister, Evangelos Venizelos, closed a $5 billion budget short fall with a final burst of tax increases and spending cuts. Final tally now: $117 billion.
(CNN) – A surprise attack from an unlikely source sent oil prices reeling Thursday.
The International Energy Agency, the Paris based research arm of 28 industrialised countries, held an emergency press conference to announce that its members would release 60 million barrels onto the market – allocating two million barrels a day for a month. Half of the total will be coming from the U.S. Strategic Petroleum Reserve.
It is only the third time the IEA tapped reserves; the first was in 1991 during the Gulf War, then again in 2005 when Hurricane Katrina wiped out some production in the Gulf of Mexico.
This move triggered memories of G-7 currency interventions in the mid-1980s, the fabled Plaza and Louvre accords, when collective action by central banks was taken to either raise or lower the U.S. dollar.
The Russian government is trying to woo the world as it seeks to increase foreign investment into the country.
In an attempt to diversify from the oil and gas industries, the country is putting money behind investing in new companies.
CNN’s John Defterios reports on the initiative from the St Petersberg International Economic Forum.
Austrian President Heinz Fischer talks about his country's relationship with Russia.
Fischer said: "I know some European countries, because of ther history, are very suspicious vis-à-vis Russia, (but) we have a trustful relationship and we believe it can be expanded economically, politically and strategically."
He says Russia's infrastructure needs development, including the health services, tourism and the energy sector.
Fischer also said it would be better if Russia was a member of the World Trade Organization (WTO).
The State Hermitage Museum is synonymous with St. Petersburg, playing an important cultural and economic role in the Russian city often called the Venice of the North.
Mikhail Piotrovsky, director of the museum, said: "This is a great symbol of culture and Russian history.
"Economy of culture is a very import part of the world culture and the economy of the city, we bring a lot of tourists here."
Armenian export was worth 20% of GDP in 2000 but it is only 12% of GDP today; the trade balance is still negative.
Armenian Prime Minister Tigran Sargsyan says the Armenian economy is not sufficiently diversified and he wants to boost the country's industrial base.
He says promoting export is still a primary concern and he also discusses the country's complex relationship with neighbor Turkey.
Among the BRIC nations, which now includes South Africa too, Russia has a bad rap for its business climate.
It is enjoying the white nights or long days of summer, but it is not considered a bright light when stacked up against its peers.
In the latest World Bank "Doing Business" survey, Russia is at the bottom of the pile of BRIC countries , the bottom of the G-20 list and also in the broader rankings of the major industrialised countries.
CNN's John Defterios takes a look at Russia's economy and the restructuring plans set out by its political and business leaders.
The dozen members of OPEC convened in a climate of highly charged politics, a war in a member state and with countries like the United States asking for some relief from $100 oil. It was one of the most interesting meetings in a decade because it is evidence that geo-politics and oil definitely mix and cause combustion.
In an unusual twist, ministers left Vienna without an agreement to increase their so-called production quota to match their current production. The market and perhaps more importantly the industrialised countries – led by the U.S. and Europe – were looking for a signal that more oil would be on the way.
This was a classic OPEC scenario that has not played out for years. In one corner the doves who wanted to maintain demand with reasonable pricing: OPEC heavyweight Saudi Arabia along with two other countries with spare oil to offer, the United Arab Emirates and Kuwait. In the other corner the price hawks: Venezuela, Iraq and Iran whom have traditionally pushed for higher prices.
At this meeting, the hawks won out. A senior delegate from a Persian Gulf state said he was stunned by the outcome. The tone behind closed doors was not one of cooperation, but of protecting their respective positions.
One source on the ground here said pressure from the International Energy Agency and from the U.S. ahead of the meeting actually played against the proceedings here. No one wanted to be seen helping the West while the Middle East remains in turmoil.
OPEC Secretary General Abdulla El Badri told CNN at the start of the meeting that “OPEC is always ready to act to make sure the market is well supplied,” but in reality he could not convince others to make that official. He says the market continues to price in a 15-20 percent premium based on concerns around the Arab uprisings.
If one looks at the first half chart for North Sea Brent crude when prices averaged $109 a barrel, there was a spike every time an uprising began – Egypt, Libya, Yemen and now Syria. In 2010, prices averaged $79 – closer to what I like to call the “Goldilocks Scenario” a level that is not too high for importers and allows ample revenues for OPEC producers. Right now the market is out of kilter and wanted OPEC to raise a 2008 quota of 24.8 million barrels a day to match current production of 26.3 million barrels.
If life was only that simple. Coming into the meeting here in Vienna the presidents of Venezuela and Ecuador both said oil at the century mark is a fair price. Venezuela’s oil minister Rafael Ramirez echoed that call at the meeting. To his right, was one of the more moderate price doves, the UAE minister Mohamed Al Hamli, a veteran of the energy business in Abu Dhabi. He told me the market is tight and more supplies would be needed in the second half. He added that he has spare capacity of a half million barrels a day on offer.
Beyond the pricing debate, there were plenty of other plot twists to highlight. Iran has the rotating presidency of OPEC and Mahmoud Ahmadinejad sent a former sports minister to be here and nominated him as oil minister. That raised a few eyebrows amongst peers. Moammar Gadhafi sent the former head of the country’s power grid to come. He did not make the opening session and joined the session four hours late. Libya prior to the war was producing 1.6 million barrels a day. Most of that is off the market and it has been Saudi Arabia filling the void.
And that leaves, the Kingdom’s veteran oil minister, Ali Al Naimi. After 16 years within the OPEC community and a great track record of getting deals done before the meeting starts, this time he left empty handed and crude prices responded accordingly.
Like the royal wedding that preceded it, the visit of President Barack Obama to Britain has been orchestrated well. Beyond discussions of the essential relationship, the U.S. president went out of his way both in his speech before both chambers of the British parliament and in his news conference with Prime Minister David Cameron to support what he calls the emerging democracies of the Middle East.
At the front of the queue are the two countries that sparked the uprisings, one of the least populated, Tunisia, and the most populated in the region, Egypt. There has been criticism from many camps that the U.S. president has been dragging his feet in supporting the North African states who overthrew Zine El Abedine Ben Ali and Hosni Mubarak.
Urgently required: A senior level politician to chair international organization with a myriad of shareholders from around the globe.
Board members include the U.S., Germany, France, China and Saudi Arabia. Candidate must feel at ease with leaders ranging from Barack Obama to Wen Jiabao and have a wide-range of contacts from Wall Street to Shanghai and all places in between.
The financial crisis of 2008 demands this person would have an intricate knowledge of financial instruments, Basel III banking rules and monetary policy. The ideal candidate is a European that commands the respect of the Chancellor of Germany, embraces the G-20 architecture and has the backing of the President or Prime Minister of your home country. Female candidates are encouraged to apply.
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