02-10-2017 | EYE ON GREECE | EU

02-10-2017 | EYE ON GREECE | EU

Monday, October 2, 2017

Stournaras urges speedy conclusion of bailout performance review

Greece’s economy is recovering after a deep recession and growth is set to pick up in the next two years, the head of its central bank said on Thursday, urging a speedy conclusion to its next bailout review to avoid a new cycle of uncertainty.

http://www.ekathimerini.com/222050/article/ekathimerini/business/stournaras-urges-speedy-conclusion-of-bailout-performance-review

Flurry of contacts leads to IMF converging with the ECB

The International Monetary Fund has retreated from its demand for an asset quality review (AQR) of Greek banks, according to statements made on Thursday in London by the head of the IMF’s European Department, Poul Thomsen. The Washington-based Fund insists, however, that a medium-term strategy is needed to tackle the issue of bad loans.

http://www.ekathimerini.com/222044/article/ekathimerini/business/flurry-of-contacts-leads-to-imf-converging-with-the-ecb

Turk jets enter Greek air space, again

Turkish military aircraft violated Greek air space 36 times Friday in the northeastern, central and southeastern Aegean. The Turkish airplanes – 12 F-16s and a CN-235 – also violated the Athens Flight Information Region nine times.

http://www.ekathimerini.com/222077/article/ekathimerini/news/turk-jets-enter-greek-air-space-again

Greek FinMin says he doesn’t believe more austerity measures will be needed in 2018

Greek Finance Minister Euclid Tsakalotos ruled out new austerity measures in 2018, while repeating the embattled government’s pledge that the looming third review of ongoing bailout will conclude in a timely manner.

http://www.naftemporiki.gr/story/1281074/greek-finmin-says-he-doesnt-believe-more-austerity-measures-will-be-needed-in-2018

Abducted businessman located, freed on Crete after six months of captivity

A businessman on the island of Crete was freed by police on Sunday after six months of captivity.

http://www.naftemporiki.gr/story/1281345/abducted-businessman-located-freed-on-crete-after-six-months-of-captivity

Gov’t says Fraport will be paid for proven problems in airports

Deputy Economy Minister Stergios Pitsiorlas conceded on Friday that the government is in the process of examining a list of problems that Fraport Greece identified and resolved at the 14 regional airports it took control of in spring, adding that if the German-led consortium can offer proof of the problems the state will pay any compensation that is due.

http://www.ekathimerini.com/222076/article/ekathimerini/business/govt-says-fraport-will-be-paid-for-proven-problems-in-airports

EIB to invest in Piraeus Bank covered bond to help fund small businesses

The European Investment Bank (EIB) will invest 350 million euros in a covered bond that Piraeus Bank will issue next month as part of efforts to increase lending to small businesses in Greece, its president Werner Hoyer said in Athens on Friday.

http://www.ekathimerini.com/222056/article/ekathimerini/business/eib-to-invest-in-piraeus-bank-covered-bond-to-help-fund-small-businesses

Alpha Bank: Tourism, small-scale manufacturing exports leading econ recovery in Greece

Alpha Bank’s weekly economic bulletin this week points to tourism and exports of small-scale manufacturing goods as the biggest positive factors in a budding Greek economic recovery,

http://www.naftemporiki.gr/story/1281031/alpha-bank-tourism-small-scale-manufacturing-exports-leading-econ-recovery-in-greece

ATHEX: Bank stocks fall 22 pct in September

The Greek bourse’s main index fell 8.46 percent over the month of September while the banks index dropped 22.4 percent. Meanwhile, gains seen during Friday’s trading session had all but evaporated by the end of the day.

http://www.ekathimerini.com/222072/article/ekathimerini/business/athex-bank-stocks-fall-22-pct-in-september

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SUNDAY PAPERS

KATHIMERINI: Tax legislation changes twice a month

TO VIMA: They are asking Tsipras for leaps. Ministers prompt the PM to seek new allegiances in Europe and Greece

REAL NEWS: Nervous breakdown for the government. The PM’s office is outraged with party executives who undermine investments

PROTO THEMA: Fear… guards homes. Notaries abstain from auctions after being threatened that their offices will be raided

AVGI: The budget is going to integrate a ‘social dividend’

RIZOSPASTIS: We will respond to the ‘winter’ of their ‘growth’ with organized fight

MONDAY PAPERS

ETHNOS: Protection net [from bank claims] for 700,000 small businesses

TA NEA: Accomplices to a lie. PM’s office does not comment on the lies of Defense Minister Kammenos who paid cash in the London casino despite contrary claims

EFIMERIDA TON SYNTAKTON: Bloody ballots in Catalonia

KONTRA NEWS: Many European states are preparing for defection referenda

DIMOKRATIA: PASOK is blackmailing New Democracy!

NAFTEMPORIKI: Listed companies’ profits leap in H1 2017

CRISIS IN CATALONIA …

As it happened: Get a blow-by-blow on our live blog, which ran throughout Sunday.

Results: Separatists claimed an overwhelming victory, with the Catalan regional government announcing early Monday that with almost all votes counted, turnout was around 42 percent, with 90.1 percent voting ‘Yes’ to independence and 7.9 percent ‘No.’

5 takeaways from manic Sunday: Diego Torres writes that Spanish Prime Minister Mariano Rajoy gave Catalan separatists the political ammunition they were hoping for: Images of Spanish police in riot gear on Sunday charging against crowds of unarmed civilians casting votes.

El Cid: “We did what we had to do. We are the Spanish government, I am the leader of the government and I assumed my responsibility,” Rajoy said late Sunday to explain his government’s crackdown.

Independence declaration imminent? “Catalonia has won sovereignty and respect and its institutions have the duty to implement that result,” said Carles Puigdemont, Catalan first minister.

A selection of clips that went viral on Twitter: Police raid a polling station | Police beat protesters lying in a street, Catalan firefighters and chanting protesters

EU response: Calls for action from the EU to calm the situation have been growing louder in recent days, although so far Brussels has remained silent. Spokespeople for President Jean-Claude Juncker, Parliament President Antonio Tajani, Council President Donald Tusk and the EPP group’s Chairman Manfred Weber told Playbook’s Harry Cooper they would not comment, while a spokesman for Vice President Frans Timmermans didn’t respond.

Greens to demand emergency debate in Strasbourg: Last week the leaders of the European People’s Party and Socialists & Democrats — both of which include Spain’s largest political parties — voted down a Greens proposal to hold a debate on the situation in Catalonia in Strasbourg. “The European Commission can’t continue to turn a blind eye on the situation in Catalonia,” said Ska Keller and Philippe Lamberts, co-presidents of the Greens. They will make the same request today at 5 p.m. for a debate to take place, which would require a majority of the MEPs present in the plenary chamber to go ahead. If it did, the European Commission and the Council of the EU would be obliged to give formal statements on the situation.

When asked by Playbook whether they would support a debate, both the EPP and S&D spokespeople said no, while a spokesman for the Liberals said a decision would be taken at a group meeting at 3 p.m.

A Russian-inspired coup d’étatIn recent weeks, Russian state-backed news organizations and social network bots have aggressively promoted digital misinformation and fake news about the vote, according to an analysis of recent online activity, report Mark Scott and Diego Torres.

POLITICIANS SPEAK OUT…

While a majority of the EU’s most senior politicians kept quiet, some did release statements.

Gianni Pittella, leader of the Socialists & Democrats group: “This is a sad day for Spain and for the whole of Europe. There is no doubt that the non-referendum organized and supported by the Catalan authorities is to be considered illegal and invalid. However, the feelings of so many Catalans that took to the streets must also be heard … The solution can only be a political response, not a police one.”

Guy Verhofstadt, leader of the Alliance of Liberals Democrats in Europe: “I don’t want to interfere in the domestic issues of Spain but I absolutely condemn what happened today in Catalonia … It’s high time for de-escalation. Only a negotiated solution in which all political parties, including the opposition in the Catalan parliament, are involved and with respect for the constitutional and legal order of the country, is the way forward.”

Miro Cerar, Slovenia’s prime minister: “I am concerned about situation. I call for political dialogue, rule of law and peaceful solutions.”

Charles Michel, Belgium’s prime minister: “Violence can never be the answer! We condemn all forms of violence and reaffirm our call for political dialogue.”

Linas Linkevicius, Lithuanian foreign minister: “Emotional charge is strong, wounds of mistrust deep, dialogue w own people is a must for #Spain. Violence will not help.”

COMMISSION — JUNCKER AND MACRON EU VISIONS COMPARED: The Commission’s in-house think tank the European Political Strategy Center published a comparison of French President Emmanuel Macron and Commission President Jean-Claude Juncker’s visions for the future of the EU.

Mixing Brexit metaphors with Juncker: The Commission president told Bild in an interview published this morning he would gladly accept the olive branch U.K. Prime Minister Theresa May extended in Florence “if there are real olives on it … But we need meat on the bones.”

More highlights from Juncker’s interview: 

Commission President Angela Merkel? “I do not think she has such plans, although I would have nothing against it. I would prefer that she remain chancellor for a very long time.”

British cartoonists often portray you with an empty wine bottle or a full glass of wine. Does this damage your authority as president? “I do not feel the cartoons, or particularly the articles, do me justice.”

GERMAN ELECTION CORNER …

Denial, denial, denial: A full week after Germany’s election shocker, the country’s political establishment is still in a state of denial. “I don’t see what we could have done differently,” Merkel said last week, surprising many, given she led the conservatives to their worst finish since 1949. Word has it, Merkel doesn’t share the conventional wisdom that her handling of the refugee crisis is what drove more than 1 million voters to the far right. Martin Schulz, whose Social Democrats vowed to go into opposition after plumbing new lows of their own at the polls, has been busy blaming everyone but himself.

Soul-searching on the AfD’s success: Two-thirds of Germans say they’re not happy with the election result. No one in the political mainstream seems to be ready to take the blame for the runaway success of the far-right Alternative für Deutschland (AfD). Even the press is in full soul-searching mode. The big question is why the AfD did so well in the former East Germany, where the party garnered roughly double the votes it did in the west. It’s tempting, if a tad reductive, to chalk the AfD’s strength up to eastern Germans’ longstanding resentment of their western cousins. East German intellectuals are pleading with their countrymen to move beyond the Wessi/Ossi cliches. They point to a recent study by the University of Leipzig that suggests Germans’ attraction to the AfD and its ilk is more about cultural identity than economics.

Whatever the root cause, consider this: About 40 percent of voters in the former German Democratic Republic voted for fringe parties on the right and left.

Coalition talks latest …

Coalition talks have yet to begin and are unlikely to anytime soon. Though the only real possibility is a three-way tie-up with the liberal Free Democrats and the Greens (the so-called Jamaica coalition), Merkel’s Christian Democrats want to wait until after regional elections in Lower Saxony on October 15 before even holding exploratory talks. A three-way deal would be a first in Germany at the federal level and is fraught with complications. Here’s why Merkel may never reach Jamaica’s shores …

One love? A big reason Merkel has put off exploratory talks with the Greens and FDP until later in the month is that she needs to get her own house in order. The CSU, the Bavarian wing of her bloc, suffered even bigger losses last week than the CDU. CSU leader Horst Seehofer, who clashed repeatedly with Merkel over her handling of the refugee crisis in recent years, is trying to quell a mutiny in his own ranks. He has vowed to close the party’s “right flank,” code for a harder line on all refugee-related issues. At this stage, whether Seehofer survives or not is secondary. Either way, the CSU, which wants to defend its absolute majority in Bavaria next fall, will shift to the right. Many conservatives among Merkel’s Christian Democrats would welcome such a shift. Merkel? Not so much. She and Seehofer are due to meet October 8 to discuss the way forward.

Obergrenze: If you learn one German word in the coming months, make it obergrenze — “upper limit.” The CSU demands one on refugees, a no-go for Merkel, the Greens and even the FDP. The CSU already backed down on this issue once, a move it blames for the AfD’s strong showing in Bavaria, and is unlikely to repeat the mistake. Bavarian Finance Minister Markus Söder (CSU leader Seehofer’s main rival) said over the weekend the obergrenze — which the party leadership defines as a fixed limit, including refugees and all family members — is a hard condition for the CSU to enter a coalition. If there’s a single issue that could scuttle hopes for Jamaica, the obergrenze is it, POLITICO’s Janosch Delcker explains.

One might wonder why the Bavarians are still so fixated on the refugee question, given the number of newcomers has fallen so dramatically. One reason is a series of recent rape cases, including the alleged gang rape of a 16-year-old girl near Munich.

Little Green women (and men): Even if Merkel manages to craft a deal with the FDP and Greens, it won’t be done and dusted until the Greens’ own membership has approved it. That will likely be a tall order, considering rank-and-file Greens tilt to the left of their leadership. Winning them over on policies related to refugees will be particularly tricky. The Greens oppose the current government’s deportation practices, which have included sending rejected asylum applicants back to Afghanistan.

Quote of the weekend: “With the Greens, a bit of tofu has fallen into our beef stew.” CSU parliamentary leader Alexander Dobrindt, explaining why he would have preferred a two-way coalition with the Free Democrats.

BREXIT — MAY’S ‘MAXIMUM DANGER’ MOMENT: POLITICO’S Tom McTague explores whether Prime Minister Theresa May can survive a seemingly inevitable cabinet civil war over the depth of post-Brexit regulatory convergence with the EU. According to Tom’s sources, May is leaning towards the more moderate camp of Chancellor Philip Hammond, setting up a clash with the Boris Johnson camp.

UK — 9 THINGS TO WATCH AT TORY CONFERENCE: How to read the annual Tory jamboree, by Annabelle Dickson.

FRANCE — MACRON’S WEEDKILLER BET: National experts are set to vote on whether to re-authorize the controversial pesticide glyphosate later this week. French President Emmanuel Macron has stated his government will vote down the proposal over health concerns, triggering a backlash from the country’s powerful farming unions.

IRELAND — BINGE-DRINKING CLAMPDOWN: Ireland is currently debating a law to tackle binge-drinking that would require supermarkets to segregate alcohol from other products, potentially in separate rooms. Smaller shops would have to conceal booze in cupboards or behind curtains — earning the measures the nickname of the “beer burqa.”

COUNCIL — EU NEGOTIATES WITH AZERBAIJAN AMID LGBT CLAMPDOWN: Negotiations between the EU and the government of Azerbaijan to upgrade the bloc’s bilateral agreement with the Caucasian country took place last week — amidst reports authorities in Baku are rounding up gay men claiming they present a public health risk. “The main reason for such raids was the numerous appeals from the residents of the capital. People complain that [gay and transgender men] walk around us, walk in our streets, and sit in our cafés … Those who have diseases are being isolated from society,” Ehsan Zahidov, spokesman for Azerbaijan’s ministry of internal affairs, told Eurasianet.org in an interview. The Commission said it was aware of the “disturbing reports … of mass arrests” and that it was in touch with the Azeri authorities.

COUNCIL — NORD STREAM 2 LEGAL ASSESSMENT: Council lawyers have shot down a plan by the Commission to negotiate with Russia how to operate Nord Stream 2 — another twist in the legal saga. EU governments are currently considering whether to grant the Commission the mandate.

TECH MEETS POLITICS: Tech companies like Facebook, Google and Twitter can no longer pretend they don’t shape elections, writes Mark Scott. Now they face increased scrutiny from lawmakers fearful of their oversized influence.

PLAYBOOK INTERVIEW — KARMENU VELLA, THE EU’S COMMISSIONER FOR THE ENVIRONMENT …

A modern-day Poseidon, Vella aims to solve all the problems facing the world’s oceans — from marine plastic litter to illegal fishing — as the co-host of this week’s Our Ocean conference in Malta, the brainchild of former U.S. Secretary of State John Kerry. POLITICO’s Kait Bolongaro spoke with Vella ahead of the conference.

Oceans on life support: “There is a limit to how much our oceans can take. Instead of continuing to have our oceans as the main climate regulators, they may start deregulating the climate,” said Vella, adding he’s saddened by the death of much of Australia’s Great Barrier Reef.

Global issue: “We have to act together because when we talk about oceans, we’re not something that belongs the EU, U.S. or China.”

Enough cheap talk: Vella has strong words for those unprepared to act to save the world’s oceans — starting with those attending Our Ocean. “I am talking about commitments, not just words and thoughts,” he said. “We need to act. [World leaders] have been talking and discussing at a number of oceans conferences and now we need to walk the talk.”