2011年10月28日星期五

Germany approves EU bailout fund

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29 September 2011 Last updated at 16:40 GMT German Chancellor Angela Merkel (c) smiles surrounded by MPs holding their ballots on September 29, 2011 at the lower house of German parliament Chancellor Merkel achieved her majority after intense lobbying Germany's parliament has voted by a large majority in favour of supporting a more powerful fund to bail-out troubled Eurozone economies.

Chancellor Angela Merkel received strong support despite criticism of the plan from some of her ruling coalition.

Many Germans are against committing more money to prop up struggling eurozone members such as Greece.

There are protests in Athens where international inspectors have held talks on further bailout funds.

The measure is expected to pass in Germany's upper house of parliament, where it will be put to a vote on Friday.

In the Bundestag, 523 deputies approved the bill to support the expansion of the European Financial Stability Facility (EFSF) - 85 voted against and three abstained in the 620-seat chamber. Nine members were not present.

Dissidents

Some members of Mrs Merkel's coalition had vowed to vote against the bill.

But in the end, 315 deputies voted in favour, meaning that Mrs Merkel did not have to rely on opposition support to get the measure passed.

The outcome of the vote was not in question, however, as the main opposition parties, the SPD and the Greens, indicated they would support the expansion of the fund.

Before the vote, there was intense lobbying by Mrs Merkel's Christian Democrats (CDU) and their coalition allies to pressure the handful of dissidents to get in line.

Continue reading the main story image of Stephen Evans Stephen Evans BBC News, Berlin

Chancellor Merkel got her majority more easily than she might have expected. Fifteen members from parties in her coalition government voted against her, not enough to make her have to rely on the opposition.

The main opposition party, the Social Democrats, supported the government.

As one of its MPs put it in the debate: "We will vote with you because Europe needs this vote. Don't rely on us next time."

In the end, 523 MPs voted with the government and 85 against, including the left group.

Chancellor Merkel emerges not quite unscathed but not as a dramatically weakened leader either.

A reliance on this support would have cast into doubt her ability to get forthcoming votes on both a further bailout for Greece and a permanent successor to the EFSF through the Bundestag.

"The broad majority in parliament clearly shows Germany is committed to the euro and to protecting our currency," said Hermann Groehe, the number two in Ms Merkel's Christian Democrats (CDU) party.

But Frank Schaeffler of the Free Democrats party - a junior coalition member - argued that bailout measures have made Greece's economic situation deteriorate.

"Despite all arguments, the first bailout did not make the situation for Greece better, but worse," Mr Schaeffler said, according to the AP news agency.

"Expanding the fund will make the situation even worse."

Athens blockade

All 17 countries that use the euro must ratify the commitment made in July to expand the powers of the EFSF and boost its bailout guarantees from 440bn euros (£383bn) to 780bn euros.

So far, 10 have approved the measure.

As Europe's largest economy, Germany's commitment to the fund would rise from 123bn euros to 211bn.

That bigger fund is already being dismissed as inadequate in the light of the worsening Greek crisis and the threat of it spreading to other economies.

The former President of European Commission Romano Prodi said the German public will come round to supporting the deal

Inspectors from the "troika" of international creditors supporting Greece - the European Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF) - returned to Athens on Thursday to decide if the government has done enough to warrant another 8bn euros (£6.9bn) of loans.

"The climate was positive and creative after the tough measures that were decided," Greece's finance ministry said in a statement.

Public workers blocked entrances to a number of ministries in Athens, protesting against the deep austerity measures the government has imposed as a condition of the bailout.

"Take your bailout and leave," shouted protesters outside the finance ministry, Reuters news agency reported. They said they wanted to prevent Finance Minister Evangelos Venizelos from meeting the troika officials.

Taxi drivers, hospital workers and other public sector staff were also due to strike on Thursday, angered by the announcement of new austerity measures including pension cuts and a new property tax.

Without the new loans - laid out under the terms of a bailout agreed last year - Greece will soon run out of money.

New taxes have been approved and deeper spending cuts have been promised, but some decisions have been delayed and privatisation is running behind schedule says the BBC's Chris Morris in Athens.

Many people believe that austerity measures are pushing Greece's crippled economy deeper into recession and strangling any chance of growth.


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AUDIO: Greek government 'must stop fooling around'

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A senior German politician in Angela Merkel's coalition has said that Greece should leave the euro.

Former Greek finance minister, Stefanos Manos tells us why the Greek government should get tougher ahead of today's meeting of Europe's finance ministers.

Get in touch with Today via email , Twitter or Facebook or text us on 84844.


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2011年10月27日星期四

Kodak denies any bankruptcy plans

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2 October 2011 Last updated at 10:09 GMT Kodak billboard Time Square Kodak is one of the best-known and most iconic brands in photography Eastman Kodak has said it has "no intention of filing for bankruptcy".

The struggling US camera and printing group's comments came after it confirmed it had hired a law firm well-known for handling bankruptcy protection cases, Jones Day.

Kodak said it was "not unusual for a company in transformation to explore all options".

Shares in the firm fell 54% on Friday as fears persist about its future. It has not made a profit since 2007.

Kodak, synonymous with film photography for more than 100 years, has struggled to adapt to the digital age.

Last week it announced plans to borrow $160m (£103m) for "general corporate purposes".

Kodak is now continuing to explore a sale of its digital imaging patents, worth an estimated $2bn.

Mark Kaufman, an analyst at Rafferty Capital Markets, said: "I don't believe bankruptcy is inevitable.

"This is a pretty valuable portfolio, they should get a good price.

"They need to get this [sale] out of the way. They need to sell this portfolio, raise some type of cash."

The company currently has a market value of $210m. This compares with $31bn at its height in February 1997.


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VIDEO: Business Lessons from Minnesota

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30 September 2011 Last updated at 11:01 GMT Help

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VIDEO: Eurozone troubles worry Australia

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4 October 2011 Last updated at 01:21 GMT Help

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UK's AAA rating confirmed by S&P

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3 October 2011 Last updated at 13:23 GMT George Osborne The news from S&P is likely to be welcomed by Chancellor George Osborne Ratings agency Standard & Poor's has confirmed the UK's AAA credit rating.

S&P said that despite sluggish growth, the UK's "diversified" economy and "flexible" fiscal and monetary policy would enable it to weather a slowdown.

The news will be welcomed by Chancellor George Osborne, who on Monday told the Conservative Party conference that he would not change economic course.

S&P said its AAA rating could be re-evaluated if the government weakened its resolve to reduce public debt.

An AAA rating is the highest possible. Any downgrade would raise Britain's borrowing costs, and also provide ammunition for the coalition government's opponents.

'Lacklustre' Continue reading the main story
The official assumption that the private sector will quickly step in to replace the withdrawal of public spending may prove optimistic, especially given weakening external demand”

End Quote S&P In an announcement, S&P said it had "affirmed its AAA long-term and A-1+ short-term sovereign credit ratings on the UK. The outlook remains stable."

It said the decision reflected the country's "wealthy and diversified economy, fiscal and monetary policy flexibility, and relatively adaptable product and labour markets".

S&P added: "In addition, we view the UK as having deep capital markets with strong demand for long-dated gilts by domestic institutional investors.

"There is also demand from non-residents for sterling-denominated UK government debt, which provides some diversification to the UK's investor base."

The agency said, however, that the UK's recovery has been "lacklustre".

It added: "The official assumption that the private sector will quickly step in to replace the withdrawal of public spending may prove optimistic, especially given weakening external demand."

The decision to hold the UK's rating comes just over a month after S&P shocked the markets with its first ever downgrade of US debt, cutting it from AAA to AA plus.


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Banks rally on rescue deal hopes

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26 September 2011 Last updated at 20:21 GMT Continue reading the main story Last Updated at 17:44 GMT

Market indexCurrent valueTrendVariation% variationEuropean bank shares have risen as investors react to the latest attempts to stabilise the eurozone debt crisis.

A number of measures are being discussed according to reports from the weekend's international meeting in Washington.

They are expected to involve a 50% write-down of Greece's massive government debt, the BBC's business editor Robert Peston says.

French and German bank shares were up 10% at one stage in Monday trading.

European governments hope to have measures agreed in five to six weeks, in time for a meeting of the leaders of the G20 group in Cannes at the beginning of November.

But EU officials in Brussels stress that they should not be seen as "a single grand plan", the BBC's correspondent Chris Morris says.

The measures being discussed are:

Institutions that have lent money to Athens writing off about 50% of the money they are owedThe size of the eurozone bailout fund, the European Financial Stability Facility (EFSF), increasing dramatically to 2 trillion euros (£1.7tn; $2.7tn)Strengthening big European banks that could be hit by any defaults on national debt obligations.

However, on Monday evening AFP reported that German Finance Minister Wolfgang Schaeuble had told television news channel NTV that there was no plan to boost the size of the EFSF.

"We are giving it the tools so it can work if necessary," Mr Schaeuble was reported as saying.

"Then we will use it effectively but we do not have the intention of boosting its volume."

Pan-Europe gains

Uncertainty over how to tackle Greece's problems has led to some European bank shares losing half their value in recent months due to concerns about their holdings of Greek debt.

But on Monday, French banks, which are particularly exposed to Greece, rallied, with BNP Paribas and Societe Generale up 4% and 5.4% respectively, and Credit Agricole up 3.7%.

Continue reading the main story
Unless the banks are fixed, there will remain too big a risk that a financial crisis could turn the current global economic slowdown into something more akin to depression than recession”

End Quote image of Robert Peston Robert Peston Business editor, BBC News Germany's big banks were also up sharply. Allianz was up 10%, Deutsche Bank 8% and Commerzbank 7.7%. In the UK, Barclays rose 6.8% and RBS 3.3%.

The Frankfurt was up about 3% at close, and in Paris by about 2%. The UK's main index, the FTSE 100, was virtually unchanged.

US shares closed higher, with the Dow ahead by 2.5%, the S&P 500 by 2.3%, and the Nasdaq by 1.4%.

However, commodity prices were lower on remaining concerns that the eurozone crisis could affect the global economy.

Philip Tyson of brokerage MF Global told the BBC that the proposed bailout fund had to be at least 2tn euros.

He said: "Markets need confidence that the fund has the firepower to deal with the likes of Italy and Spain should contagion risks spread.

"It does need to happen, but there are big question marks about the detail, and exactly how it will happen. Time is running out."

Ben Critchley, a sales trader at spread betting group IG Index, said: "For now at least, it looks as if markets are giving some credence to a firm plan on how to tackle the debt crisis beginning to emerge.

"But if recent experience is anything to go by, this patience is unlikely to last too long if details are not forthcoming."

Key elements

The reports about the rescue proposals emerged from the annual meeting of the IMF in the US capital last week, attended by finance ministers from the G20 group of countries.

The package is expected to involve a quadrupling - from the current projected level of 440bn euros - in the firepower of the eurozone's main bailout fund, the EFSF.

Continue reading the main story
The problem, they said privately, was that ministers couldn't talk openly about a new solution to the crisis when the old one had not even been passed by national parliaments. This was a particular issue, naturally, for Germany.”

End Quote image of Stephanie Flanders Stephanie Flanders Economics editor, BBC News It is not entirely clear how any expansion of the facility would be managed, but one suggestion is for the EFSF to guarantee the first part of any losses creditors sustain from a government defaulting on its debts, with the European Central Bank (ECB) providing an additional 1.5tn euros of loans.

The EFSF would take on the main risk of lending to governments struggling to borrow from normal commercial sources - governments like Italy.

It is also thought that private investors in Greek debt are likely to have to accept a 50% reduction in what they are owed, our editor says.

Eurozone leaders agreed a plan in July, which has yet to be ratified, that provided for a reduction in Greece's repayments to banks of about 20%.

European officials in Brussels stressed that their current focus was on getting measures, including changes to the EFSF, agreed back in July ratified by 17 national parliaments within the eurozone.

It was proving a difficult task, the BBC's Chris Morris says, to get these less far-reaching changes passed, with Germany one of three assemblies to vote this week.

The third element of the rescue plan envisages a strengthening of big eurozone banks, which are perceived to have too little capital to absorb losses.

'Critical days'

Commodity prices remained under pressure, pulled between relief that a eurozone deal could be nearer and worries that the global economy faces a downturn.

Continue reading the main story Oil prices fell sharply in early trading, but recovered with Brent crude up 60 cents at $104.57 a barrel and US light, sweet crude up 55 cents to $80.40 a barrel.

The stronger dollar, which rose around 0.2% against a basket of currencies, also weighed on oil prices as it makes dollar-denominated assets more expensive.

Gold fell 3.2% to $1,603.95 an ounce, continuing recent declines from record highs. Copper, which has already fallen, was down another 4%.

Senior commodities analysts Edward Meir, at brokers MF Global, said: "These are very critical days and weeks ahead, reminiscent very much of the touch-and-go situation we were in back in 2008.

"The key difference this time around is that it is countries and not companies that are in danger of going bust."


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