The bank association said on Monday that cutting lending rates was difficult due to the liquidity crunch they were going through as a result of the lack of public confidence.

“The state expects a lot from the banks but it should realise that they are still working in an environment of tight liquidity,” association chairman Marios Clerides said.

He said people have taken their money out and do not trust banks.

“Until the cash returns to the banking system so that are able to lend we will be somewhat trapped in this environment,” he said.

Clerides suggested that public confidence will return when banks stop being the leading subject in the news.

Banks reduced their lending rates earlier this month though some observers said they did not go far enough.

Before that, parliament was mulling mulling legislation that would force banks to lower their rates.

The latest statistics released by the Central Bank showed that housing loans in Cyprus remain the most expensive in the eurozone.

In September, housing loans with a one-year fixed rate (and variable subsequently), the average interest stood at 5.44 per cent, up from 5.33 per cent in August, not including administration fees.

By contrast, the eurozone average was 2.82 per cent.

Loans to businesses (up to €1m) also became pricier, rising to 6.63 per cent in September from 6.03 the previous month. But consumer loans did drop to 6.90 per cent in September from 7.04 per cent in August.

On the other end, interest on households’ deposits went up marginally. One-year deposits rose to 2.20 per cent from 2.18 per cent, while interest on deposits with an agreed maturity (up to two years) climbed to 3.58 from 3.52 per cent in August.

Interest paid on businesses’ deposits with an agreed maturity (up to one year) tapered to 1.90 per cent from 1.96 per cent previously.

By Josh Reich
THE German national team is an inspiration for other countries seeking to develop a style of their own, England manager Roy Hodgson said as he prepares his side to face their old rivals at Wembley on Tuesday (10pm).
After Germany were bundled out of the 2004 European Championships without winning a game coach Rudi Voeller was dumped in favour of Juergen Klinsmann and assistant Joachim Loew, who confounded expectations in leading the side to third-place at the 2006 World Cup on home soil.
Loew took the reigns following that tournament and set about furthering the rejuvenation of the team, introducing younger players and developing a pleasing style on the pitch.
Despite failing to win a tournament since the 1996 European Championship, Germany have risen to second in the world rankings and are expected, along with Spain, to lead the European challenge at the Brazil World Cup next year.
“I think the German FA were very wise in their attitude to changing the face of the national team and building it on youth and a very energetic style of play,” Hodgson told the Football Association’s website (www.thefa.com) on Sunday.
“Of course, as a result, the success they’ve had has not surprised anybody because we all know how good the players are and how strong the league is.”
England find themselves in a similar position heading into the Brazil finals, with the current squad featuring experienced players such as captain Steven Gerrard and Frank Lampard who are nearing the end of their careers and the likes of youngsters such as Andros Townsend who are just starting out.
The FA has been criticised for failing to develop a blueprint for the game in England, although new FA chairman Greg Dyke has set up a commission to look at ways to improve the level of the national team.
Hodgson, who is on the 10-person panel, said they could do worse than look at Tuesday’s opponents for inspiration.
“The German team has become something of an example for many other European teams who might find themselves in a transitional period that Germany obviously found themselves in going into the 2006 World Cup,” he added.
“As far as we’re concerned, we are perhaps to some extent in that transitional period I mentioned Germany found themselves in 2006.
“We have what we think is a very exciting group of young players coming along and we still have a backbone of experienced players that have been to World Cups before.
“I would like to think we can give a very good account of ourselves when we get to Brazil.”
Germany will be without Real Madrid striker Sami Khedira, who is expected to be out of action for six months following successful surgery on torn knee ligaments, while skipper Philipp Lahm, first-choice keeper Manuel Neuer and playmaker Mesut Ozil will be rested for the high-profile friendly as Loew seeks to give other players time on the pitch.
The absence of Bayern Munich stopper Neuer will offer Borussia Dortmund’s Roman Weidenfeller a chance to make his international debut, highlighting the depth of the German set-up.
He has been in outstanding form for Dortmund in recent seasons, but has earned his first call-up to the senior squad at 33 as he looks to force his way into the reckoning for next year’s World Cup.
Rene Adler, Marc-Andre ter Stegen and Ron-Robert Zieler are also in the mix for the reserve keepers positions.
“We don’t need to make any decisions with regard to the goalkeepers or indeed any other positions just yet,” Loew told the German football association (DFB) website.
“The squad for the tournament will be named in May 2014. Until then, we’re glad to have the opportunity to test out any tactics or players we can. Competition for places is only going to get tougher over the next few months.”
England, who lost 2-0 at home to Chile on Friday, have not beaten Germany at home since 1975.

Nelson Mandela remains in a stable but critical condition more than two months after hospital doctors treating him for a lung infection let him return home to convalesce, the South African government said on Monday.
The former South African president was still “quite ill” and unable speak because of tubes in his mouth to clear fluid from his lungs, ex-wife, Winnie Madikizela-Mandela, told the Sunday Independent newspaper.
“The bedroom there is like an ICU ward,” the newspaper quoted her as saying.
The anti-apartheid leader spent 87 days in a Pretoria hospital before returning to his Johannesburg family home in September.
He was receiving round-the-clock treatment from 22 doctors and used facial gestures to communicate, Madikizela-Mandela told the newspaper. Medics were hopeful he would recover his voice, she added.
The 95-year-old made his last public appearance waving to fans from the back of a golf cart before the Soccer World Cup final in Johannesburg in 2010.
In April state broadcaster aired a clip of the thin and frail statesman being visited by President Jacob Zuma and top officials from the African National Congress.
Mandela was elected South Africa’s first black president in multi-racial elections in 1994 that ended white minority rule.
His imprisonment included 18 years on the notorious Robben Island penal colony, when he and other prisoners were forced to work in a limestone quarry and he first suffered the lung infections that were to dog him for years.
“The health of the former President remains much the same … Which is stable but critical” the government said in a statement. He continued to respond to treatment, it added.

By Gérard Bon
Police were hunting a lone gunman on the loose in central Paris on Monday after he opened fire at the offices of a left-wing newspaper and a major bank before hijacking a car to take him to the Champs-Elysees avenue.
The shaven-haired assailant, who police said was filmed by video-surveillance cameras, fired shots at the office of Liberation daily, seriously injuring a photographer’s assistant before fleeing, police and staff at the newspaper said.
About 90 minutes later, he opened fire outside the suburban headquarters of Societe Generale in the La Defense business district 10 km west of the centre, wounding no one, police and a spokeswoman for the bank said.
There was no immediate indication of his motive.
Shortly afterwards, the same man hijacked a car nearby and forced the driver to drop him on the Champs-Elysees Avenue in central Paris, the driver told police.
Police said the description of the car-jacker fitted that of the gunman, who was armed with a hunting rifle or similar weapon. Cartridges found after both attacks corresponded.
“As long as this person is still on the loose and we do not know the motives, this represents a threat,” Interior Minister Manuel Valls told reporters outside Liberation’s offices. “We must move fast.”
A police helicopter hovered over the Champs-Elysees area to help in the manhunt after the gunman melted into the crowd.
President Francois Hollande, on an official visit to Israel and the Palestinian territories, said “all means” would be deployed to catch the attacker.
Earlier, Liberation managing editor Fabrice Rousselot said witnesses described the assailant as a short-haired man in his 40s. Police said he was “of European type”.
The wounded photographer’s assistant was hit in the chest, a police official said.
“He walked in, fired twice and left,” Rousselot told reporters.
Deputy editor-in-chief Fabrice Tassel said in a tweet that the young male victim was fighting for his life in hospital.
Police deployed outside the offices of other media outlets in the French capital.
The mid-morning incidents came days after an armed intruder entered the offices of the BFM TV channel, threatening journalists before disappearing. Police said video surveillance footage showed it was the same man.
Liberation’s offices near the Place de la Republique in east-central Paris were cordoned off as forensics experts investigated.

A BOMB blast damaged a car in Nicosia on Sunday.

According to the police report, the bomb went off at 9:20 p.m.

The car was parked in a residential parking spot.

Police said that upon further examination, it was concluded that the device was improvised.

The bomb damaged the left front tyre and the bottom of the vehicle.

A Syrian man was taken from his home in Nicosia on Saturday, beaten and then left handcuffed to a column in an abandoned construction site in Limassol, police said on Monday.

The man was spotted by passer-bys who heard him calling for help and notified the police.

Upon interrogation, the man said that early Saturday, four Greek Cypriot men broke into his home in Nicosia, bound him under threat of a gun, beat him and then drove him to an abandoned construction site in Parekklisia in the Limassol district.

According to the police report, the four men then proceeded to beat him again, handcuffed him to the column and left..

He was transported to the Nicosia general hospital where he was treated for multiple cuts and bruises on his body and was later released.

According to police spokesman Andreas Angelides, the victim stated to police interrogators that the kidnap has to do with his brother being wanted by the police for forgery and fraud.

FOUR hunters and their dogs were rescued on Sunday near Agios Theodoros village in Larnaca, after their car was trapped by a flash flood.

According to the police report, the authorities were notified on 5:30 pm Sunday by a woman saying that four people were trapped in a car, near the bank of an overflowed river.

Police along with emergency unit response officers rushed to the scene where they found four individuals, ages 77, 24, 19 and 16 stranded in a car. The hunters were also towing a carrier with five dogs.

Hunters and dogs were rescued and a crane was later used to remove the vehicle.

HELLENIC BANK on Monday reported a third quarter net loss of €87.2 million as net income dropped and provisions for non performing loans (NPLs) more than doubled compared with Q3 2012.

The bank said profit before provisions dropped 31 per cent year-on-year to €89.5 million.

In September 2012, Hellenic reported a net profit of €220,000.

The lender’s net income fell 13 per cent to €201.9 million.

Hellenic said provisions for NPLs rose 130 per cent to €166.5 million compared with €72.3 million in the third quarter of 2012.

Accumulated provisions for impairment of loans and advances, which also include suspended interest that is not recognised in the Income Statement, amounted to €680.7 million on September 30, 2013 and represent 15.3 per cent of total gross loans and advances.

Total gross customer loans and advances in Cyprus fell 5 per cent to €4.4 billion, while total customer deposits in Cyprus amounted to €5.5 billion, down by 23 per cent from December 2012.

Hellenic said it also paid some 9.6 million euros as part of a voluntary retirement scheme.

The lender successfully completed its recapitalisation through private funds at the end of October, after three major investors poured in €100 million, taking 75 per cent of the share capital.

Cyprus-based online game developer and publisher Wargaming Net and American hedge fund Third Point got a 30 per cent stake each by putting in €40 million apiece. Cypriot investment company Demetra received 15 per cent with €20 million.

By Bejay Browne

A NEW multi million euro mall in Paphos will finally open its doors to the public tomorrow.

It’s hoped that the Kings Avenue Mall – a landmark project costing over €110 million – will help kickstart the ailing Paphos economy.

It is being touted as a “complete destination” as it has everything under one roof, according to business development manager for the project, Socrates Georghiades.

“Not only is the building contemporary but its also uses the latest technologies. The standards are very high. We have a system to let in the sunlight but not the heat and the ventilation system is computer controlled. This means that the levels are measured and when more fresh air needs to be brought in the computer will recognise this and adjust accordingly,” Georghiades said.

The project comprises two underground parking areas and two floors for shopping, leisure, entertainment and other services.

As well as the “ultimate shopping experience,” Georghiades said there are eateries and cafés including TGI Fridays, Wagamama, Pizza Hut, Cinabon, Taco Bell, Costa coffee and Café Nero. There will be indoor and outdoor seating areas and a covered verandah.

Entertainment will also be on offer as it is home to a K Cineplex. In addition, a children’s play area called ‘Kidsland’ is on site, which is creators say is imaginatively designed to encourage creativity, fun and interaction through a wide range of games and activities. There will also be video arcades and enough underground parking spaces for 1,250 vehicles.

Georghiades said that the new Mall will open its doors at 9am on Thursday.

“At first, we will open from 9am-8pm from Monday to Saturday and on Sunday from 10am-8pm. The food court will remain open until 11pm.”

Stores due to open at the Kings Mall include Zara, Zara Home, Mango, Lepus, Mothercare, Oysho, No Limits, The End, M&S, Yves Rocher, Massimo Dutti, Jumbo, Bershka, Stradivarius, Lacoste, Swarovski, Pull and Bear, Beauty Line, Public and more.

www.kingsavenuemall.com

Yesterday, people who may never have voted for Glafcos Clerides, nor agreed with his policies – perhaps even resented him – mourned his passing.

Among the hundreds of tributes that have poured in from world leaders, foreign ministers and UN negotiators past and present, the words integrity, decency and statesmanlike have all featured prominently. In a first for a Greek Cypriot leader, even the Turkish foreign ministry issued a press release saying how they were “saddened by the news of the passing of Glafcos Clerides”.

For Clerides’ supporters, such descriptions are the very least he deserved for his dedication to creating a unified country. That circumstances failed to allow him to achieve his vision adds another layer of poignancy.

But even those who opposed his vision and the steps he took to achieve it, those who felt unable ever to vote for DISY, are aware that an era has passed. The Cyprus he moved in at the height of his powers is unrecognisable today. Among the tributes are the mentions of his humour, his love of a cigar, the odd shot of zivania and the worry beads. They all give a very human dimension to fancy words such as integrity and decency, but they also represent the quintessential Cypriot form of leadership that worked so well in the 20th century. Such a leader could be at home in the village coffeeshop talking to villagers and sympathising with their concerns and in return garnering their support for him as a man as much as for any of his policies. The personal touch created binding relationships that could work in a small country.

Paternalistic perhaps, but also sympathetic and easy going, almost laissez faire.

It was this type of leadership that one of his successors, Demetris Christofias, tried to imitate as he played up his origins as the poor boy from Dikomo who understood the concerns of the people. But by then the time had passed, and that Christofias failed so spectacularly in his attempt is not entirely down to the vast differences in personality, political beliefs and achievements of the two men.

Nor is it that Clerides’ Cyprus was a simpler place in every way. To even suggest that is to demean the horrors of the invasion and its aftermath and the tortuous efforts he made to stitch a fractured country back together.

But as we joined the European Union, and then attempted to beat fellow members at their own game by building up our banks and becoming a financial service centre, we forced the sun to set on Clerides’ form of leadership. Different rules applied and because we didn’t realise that soon enough, or take them seriously, we failed spectacularly. If the post-EU world had an ever-diminishing space for a Clerides-style leader, the post-troika world – with its impersonal diktats from far away – has no space at all.

As we near the end of this traumatic year, it is no wonder that many will look back on the Clerides years with nostalgia and regret.

By Constantinos Psillides

WORK on revamping Eleftheria Square will stop until further notice as a result of two court orders secured yesterday by project contractor Miltiades Neophytou.

The injunction orders concern a disagreement over the sum of €4.7 million, disputed between the contractor and Nicosia municipality.

The construction company is now locked in a legal fight with the municipality, blaming them for the delay in completion of the project.

The new and improved Eleftheria Square was supposed to be completed by September 2014, a year after the original deadline set in the initial agreement.

Asked to comment, Nicosia mayor Constantinos Yiorkadjis said that it’s the contactor’s right to take legal action, adding that the matter will now be resolved in court.

Yiorkadjis said the contractor chose to withdraw from a friendly settlement negotiation between the two parties.

Stavros Aletras, contracts manager for the contractor told the Cyprus Mail yesterday the company “does not wish to enter into a public debate with the municipality through the media”.

Reports surfaced last week that relations between the contractor and municipality were strained over delays in finishing the project and subsequent costs, with both sides deflecting blame.

In response to the initial report, Yiorkadjis restricted his comments to saying that completion of Eleftheria Square was “of paramount importance”.

Speaking to the Cyprus Mail last week, sources within the municipality described the then negotiations with the contractor as very delicate. The local authority’s aim was to resolve the issue as quickly and quietly as possible, and complete the project without further delay.

The design of the remodelled Eleftheria Square was created by Iraqi born architect Zaha Hadid, the first woman to ever be awarded with the Pritzker Architecture Prize.

Miltiadis Neophytou was recently in the media spotlight over a separate issue when he threatened to sue former President Demetris Christofias, claiming that he was not paid for work done on the latter’s houses in Nicosia and Kellaki village. Neophytou demanded a sum of around €600,000. The former president responded saying that Neophytou had refused payment for the work, expressing his disappointment that “an old friend turned on me”.

The contractor was awarded the tender on various government projects, including the addition of extra lanes to the Nicosia highway, the construction of a roundabout next to GSP stadium and the building of new headquarters for the Town Planning and Housing Department.

Ten Egyptian soldiers were killed by a car bomb in the Sinai Peninsula on Wednesday, one of the deadliest attacks there since al Qaeda-inspired militants stepped up violence following the overthrow of Islamist President Mohamed Mursi.

State television reported a suicide bomber carried out the assault near the coastal town of El-Arish, on the road to the border with the Palestinian-controlled Gaza Strip. A military source said the explosive was set off by remote control.

No one immediately claimed responsibility for the blast. But Islamist militants have kept up attacks in the desert peninsula in the face of a major military operation launched this summer to reassert state control.

The army pledged to continue “its war on black terrorism”.

“The precious blood of our sons only increases our determination to purify Egypt and to protect its people from violence and vengeful terrorism,” the military spokesman said in a statement posted on his Facebook page.

Thirty-five people were wounded in the attack, security officials and state media said. The soldiers were traveling by bus in a convoy on the road to the Rafah border crossing with Gaza.

The security situation in Sinai makes it difficult verify reports of attacks independently.

VIOLENCE IN SINAI AND BEYOND

Well over 100 members of the security forces have been killed in Sinai since Mursi was deposed by the army.

Militants killed 24 policemen in an ambush in North Sinai in August, days after security forces killed hundreds of Mursi supporters while dispersing their sit-in protests in Cairo.

Sixteen soldiers were killed in an attack in August last year.

Mursi was ousted on July 3 after mass protests against his rule. The downfall of Egypt’s first democratically elected head of state has also triggered attacks beyond Sinai in the towns and cities of the densely populated Nile Valley.

In a separate incident on Wednesday, three people were wounded in a bomb attack on a security checkpoint in Cairo, state television reported.

This week, gunmen shot dead a senior security officer outside his home in Cairo.

A Sinai-based militant group, Ansar Bayt al-Maqdis, claimed responsibility for the killing, according to a statement posted on a militant Islamist website. The same group has also said it was behind a failed suicide attack on Egypt’s interior minister in September.

The repeated attacks have raised fears Egypt could face a sustained period of militant violence.

The violence and the political struggle between Mursi’s Muslim Brotherhood and the army-backed government has hit investment and tourism in Egypt, an important U.S. ally that controls the Suez Canal – a vital artery of world shipping.

A steady stream of weapons from neighbouring Libya since the revolt against Muammar Gaddafi has also heightened Egypt’s security problems.

The Muslim Brotherhood has condemned violence and says it is committed to peaceful activism. But many of its leaders are standing trial for inciting violence.

In Sinai, the army has used attack helicopters, tanks and other heavy weapons in its campaign.

“They’re fighting an insurgency using very forceful means,” said Anna Boyd, manager for country risk in the Middle East and Africa at IHS Jane’s based in London. She said this risked further radicalising the population.

“This is an economically deprived area.”

“You have made us super proud” and “Greece go worldwide” were just two of the jubilant headlines splashed across the front pages of Greece’s sports papers on Wednesday as the country celebrated qualifying for the 2014 World Cup finals.

A 1-1 draw in the second leg of their playoff tie with Romania in Bucharest on Tuesday completed a 4-2 aggregate victory for Fernandos Santos’ team and a third appearance at a World Cup finals.

“Brazil, we are coming!”, declared popular sports tabloid Sportday on Wednesday, adding details of “Greece’s fully deserved place in the 2014 World Cup finals”.

Greece’s usually poker-faced coach Santos was an explosion of emotion after the result.

“I knew that this qualification is important for me, for the players but also for the Greek people, and my heart made me run to the crowd afterwards,” said the 57-year-old Portuguese.

“The biggest prize for me is that I have built a very good relationship with these players; we have a special personal relationship which makes me feel great,” added Santos, who revealed he is also considering extending his contract which expires after the World Cup.

“We will be in Brazil and we have to be happy with that. Then we’ll see. My heart tells me to stay and my mind is now sowing the seed. I have not encountered such love as I have found in Greece.”

The affection comes after a strong campaign – albeit in one of Europe’s weaker sections – where they finished second behind eventual Group G winners Bosnia only on goal difference, with a 3-1 loss to the Bosnians in Zenica their sole defeat.

The fan’s favourite, Kostas (Mitrogoal) Mitroglou after having just scored the crucial opening goal

Solid defence and sharp counter attacks were again key in making the playoffs at the expense of Slovakia, Lativa, Lithuania and Liechtenstein. The Greeks winning eight of their 10 group matches, five of them by 1-0 scorelines.

While still relying on the experienced Giorgos Karagounis, Fanis Gekas and Kostas Katsouranis, Santos has been able to reinvigorate the side by giving younger players a chance.

Olympiakos duo Dimitris Siovas and Kostas Manolas and Borussia Dortmund centre back Sokratis Papastathopoulos have impressed but the darling of the fans remains striker Kostas Mitroglou.

The 25-year-old has come of age with Olympiakos and has formed a key understanding in a front three with Celtic’s Giorgos Samaras and the tireless Dimitris Salpigidis for the national team.

Mitroglou, who was brought to Olympiakos from Borussia Monchengladbach’s youth set-up in 2007, has always shown a flair for goals but as well as an impressive strike rate, he has now shown an increased maturity in leading the attack and bringing other players into the game.

He scored twice in the 3-1 first leg win over Romania and scored the opener in Bucharest on Tuesday, his 22nd goal in all competitions this season.

Despite being somewhat media shy, Mitroglou – who has scored 41 goals in 84 appearances for Olympiakos – is affectionately known as ‘Mitrogoal’ and ‘Pistolero’ by his club’s fanatical fans for his gun-toting goal celebrations, which Greek fans will be hoping to see again at Brazil 2014.

POLICE FOUND a car believed to be stolen in the hands of a car salesman in the Famagusta district on Tuesday.

According to police, the authorities were tipped off that a 52-year-old resident of a village in the Famagusta area had a stolen car in his possession. Police went to his offices on Tuesday where they found nearby the car parked in an open space.

Based on preliminary investigations, police believe the car is stolen and has been altered to hide its identity.

The vehicle was confiscated for further examination.

A 27-year-old is in a serious condition after colliding with a stray dog while on his quad bike.

The accident occurred at around 6.40pm on Tuesday on the main road between Ayia Marina and Xyliatos, when in circumstances under investigation, the quad bike driven by the 27-year-old hit a stray dog.

The dog was killed while the 27-year-old suffered brain injuries and multiple fractures. He was rushed to Nicosia general hospital for treatment where doctors say his condition is serious though he is out of danger.

A man robbed a kiosk using a pistol in the early hours of Wednesday. According to police, at 1.15am, the man entered a kiosk in Limassol carrying a pistol. He told the employee to hand over any money in the till. Putting the money in an envelope, the armed robber left the scene on foot.

Police arrived on the scene from where they collected evidence for further examination.

The man is described as being 1.75-1.8m tall, and of thin build. He wore a woollen mask covering his face, a black track suit and motorcycle gloves.

Police believe a fire started at a betting shop in Paphos early Wednesday morning was the work of arsonists.

The fire was started at around 2am at the betting shop, situated near the new buildings of the Electricity Authority in Paphos.

The fire caused extensive damage to the shop but was prevented from spreading to nearby buildings due to the immediate response of the fire service, said police.

On site investigations were conducted by members of the police force, fire service and electromechanical service.

The betting shop owner, a 25-year-old from Paphos, told police that he opened the shop around three weeks ago and that his father managed it.

Police on Wednesday called on anyone with information as to the whereabouts of a 16-year-old girl from the Congo missing for over two weeks to contact the authorities immediately.

According to a police press release, Ruth Nanouh, 16, from the Congo went missing from the welfare service’s youth shelter in Nicosia on November 5.

The teenager is described as being of thin build, around 1.75m tall with black hair falling up to her shoulders. She was last seen wearing a wig of long black hair, black trousers, a black and white striped shirt and grey sweater with green and orange stripes.

Anyone with information as to her whereabouts is asked to contact Nicosia CID, their nearest police station or the Citizens’ Hotline on 1460.

French police have arrested a man they suspect shot a newspaper employee and fired at a bank this week, saying he had been jailed in the 1990s for his role in another Paris shootout that killed three policemen.

Abdelhakim Dekhar, 48, was arrested late on Wednesday in a semi-conscious state in a parked car in a Paris suburb, Interior Minister Manuel Valls told a news conference on Thursday. He appeared to have attempted suicide, Valls said.

The arrest came after a massive manhunt for a gunman who entered the Paris office of the left-wing newspaper Liberation and shot and seriously wounded a 23-year-old photographer’s assistant.

About 90 minutes later, he fired into the lobby of the headquarters of Societe Generale bank. The gunman then forced a driver to take him to the Champs-Elysees boulevard after which he melted into the crowd.

Police were able to identify Dekhar using DNA traces left behind on spent cartridges and in the car he used to get to the central Paris boulevard.

Dekhar was sentenced to four years’ jail for buying a gun used by a couple of suspected anarchist militants in a shootout with police in Paris in 1994.

He claimed at the time to be an agent of the Algerian security forces and denied any involvement in the incident, which became known as the “Rey-Maupin affair” after the couple.

Police were unable to question Dekhar immediately because he was believed to have taken heavy medication. He was taken to hospital.

“Everything suggests that he tried to commit suicide,” said Valls, adding that the motive for the shootings was unknown.

Valls said Dekhar had left a letter. He did not elaborate, but French TV news channel BFM reported that it mentioned Syria and Libya.

The minister said Dekhar had probably moved abroad after his release from prison in 1998. His former lawyer said she believed he had gone to Britain, where his sister lived.

By Stephen Brown

Chancellor Angela Merkel on Thursday defended Germany against international criticism that it was not doing enough to reduce its high trade surpluses and rejected the idea that it should deliberately weaken its competitiveness.

Speaking in Berlin, Merkel said it was “absurd” to suggest German companies should reduce their quality or that wages in the export sector should be higher to weaken their competitive strengths.

“It cannot and should not be the case that anyone tries to weaken Germany’s competitiveness artificially,” Merkel said.

International criticism has mounted that Europe’s largest economy must do more to spur domestic demand and that its reliance on exports is hampering Europe’s economic stability and hurting the global economy.

The U.S. administration reprimanded Germany late last month in its semi-annual report to Congress for its economic imbalances. Germany’s current account surplus, at 19.7 billion euros in September, is the biggest in the world.

European Commission President Jose Manuel Barroso has issued a similar message: Germany has “homework” to do on stability in the euro zone.

The trade surplus alone hit a record high in September as exports rose. The seasonally adjusted trade surplus widened to 18.8 billion euros from 15.8 billion in August.

Germany argues it has more than halved its current account surplus with the euro zone as a share of GDP since 2007.

Germany shed the label of “sick man of Europe” after reunification in 1990 partly through years of wage restraint that made it more competitive. Its economy is now outpacing its peers and it is under pressure to do more to help the euro zone out of its crisis by stimulating domestic demand and buying in more imports from the rest of the currency bloc.

Germany has exported more than it imports since 1952. Its trade surplus is largest vis-a-vis France, the United States and Britain.

Berlin’s critics say its overall current account surplus last year was 6.9 percent of GDP – well above the 6 percent threshold the European Commission considers excessive.

They say Germany is still saving too much and needs to liberalise its service sector to boost domestic demand.

Separately, Merkel said on Thursday that Germany is ready to work on European Union treaties in order to introduce a European banking union that would both police banks and find joint solutions to their problems.

Banking union would put the European Central Bank in charge of policing lenders from late next year and ultimately form a united front across the euro zone to back ailing banks or close them down.

Germany is attempting to weaken a central plank of banking union, namely that the euro zone clubs together to tackle frail banks, for fear that as the richest member it will end up footing much of the bill. Instead, Berlin wants losses imposed on bank creditors, including bondholders, once stress tests identify the weaker lenders.

The debate about who pays for the clean up of Europe’s banks is set to continue to hamper Europe’s most ambitious reform since the inception of the euro currency in 1999.