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Fitch: Funding imbalances persist in Cyprus and Greece

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Fitch-Ratings (1)

FITCH Ratings holds a mixed view on the prospects of southern Europe banks for 2014, noting that the funding and liquidity profiles of banks in southern Europe have generally stabilised, with the exception mainly of Greece and Cyprus, where funding imbalances persist, the agency said on Friday.

While the features of banking systems in the region vary, they are all affected by relatively weak economic prospects, despite an expected return to very modest GDP growth for all countries except Cyprus in 2014, Fitch says.

“The subdued operating environment will continue to fuel asset quality pressures and Fitch anticipates further NPL ratio growth, albeit generally at a slower pace than in 2012 and 2013. We expect lending volumes to remain low,” it added.

In 2014, in the absence of severe macroeconomic shocks, liquidity will continue to be supported by deleveraging, Fitch said, adding, however, that many banks continued to rely on central bank funding, underlining vulnerabilities.

Of its rated financial institutions in Spain, Italy, Portugal, Greece, Cyprus, Andorra and Malta, 60% are currently on Negative Outlook, Fitch noted.

However, the picture varies markedly by country, with all banks in Greece and Malta on Stable Outlook, all Portuguese banks on Negative Outlook, and the majority of Spanish and Italian banks on Negative Outlook, it says.

According to Fitch, profitability prospects are limited in view of low interest rates and volumes and income from debt securities will remain a material earnings contributor.

It added that net income for the aggregate region should benefit from a reduction in impairment charges, although they will remain high, after heavy provisioning in 2012 and 2013, and also from more competitive funding costs and the impact of cost reduction efforts.

Fitch said banks in the region largely meet capital requirements and believes that further capital building efforts will be prioritised to offset asset quality risk and weak earnings prospects, but also in the context of Basel III rules.

However, Fitch does not discard the possibility of additional capital requirements for individual banks, but also assumes that banking systems in the region that have needed external support should do relatively well in next year’s asset quality reviews given the scrutiny that they have already been subjected to, noting that this will also depend on the criteria applied.

Fitch sees some Viability Rating (VR) upside for southern European banks in 2014, notably for recapitalised banks that successfully implement their restructuring as planned, contain asset quality pressures and return to sustained profits for their core banking activities.
It adds that failure to do so may result in VR.

CNA

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EU launches probe over German renewables law – draft letter

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solar-panels-being-installed-on-a-residential-roof

(R) The European Commission is opening an investigation into Germany’s renewable energy law (EEG), according to a draft letter sent by European Union Competition Commissioner Joaquin Almunia to the German government and seen by Reuters.

Germany collects surcharges from power users to help fund operators of wind and solar power plants. Heavy electricity users such as cement, steel and chemical plants are exempt from the surcharge to keep them from being priced out of the global market, but Brussels believes this may distort competition.

The Commission can ask governments to recover aid granted to companies if this is found to have breached EU rules.

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Kerry sees Israeli, Palestinian deal possible by end of April

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US Secretary of State John Kerry says that a final Middle East peace deal can still be achieved by the end of April

U.S. Secretary of State John Kerry said on Friday a final Middle East peace deal was still scheduled to be achieved by the end of April, and that Israel would release more Palestinian prisoners on Dec. 29.

Speaking after separate talks with Palestinian President Mahmoud Abbas in the West Bank and with Israeli Prime Minister Benjamin Netanyahu in Jerusalem, Kerry told reporters:

“We’re not talking at this point about any shifts (in the scheduled deadline) and the next tranche of prisoners is due to take place on 29th of December and it will take place then.”

Israel has freed about half the 104 prisoners it had pledged to release from its jails under the deal secured by Kerry in July to renew negotiations that had been deadlocked for nearly three years.

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When the weather sensor’s broken, send a cop to measure snow levels

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weather    17

HOW do you tell how much snow there is in Cyprus? It turns out guessing will have to do.

Although police bulletins on the latest weather conditions have been coming with a line on how much snow has been piling up in the Troodos area, the information has not been coming from scientific sources.

The met office has an automated machine in Troodos that gives temperature and humidity readings, but the sensor is broken.  But never fear, it turns out that a police officer stationed in Troodos has been doing the sensor’s job instead.

Met officer Panayiotis Mouskos was asked by public broadcaster CyBC on Friday to confirm that a report by daily Politis got it right. Are official snow levels in Cyprus a ‘guesstimate’?

“I don’t know how [the police officer] estimates levels but I’m sure they must have something to take accurate measurements,” Mouskos said. “Something must have happened with the machine… the part measuring snow levels,” he said. “But it doesn’t matter very much whether it’s 80cm or 78cm or 82cm,” he said. Snow levels in the Troodos peak were 80cm yesterday, the met office said… at least that’s what they think.

 

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Authorities ‘on standby 24/7′ to help stranded villages

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WEATHER

By Poly Pantelides

AUTHORITIES said on Friday they would be vigilant overnight as cut-off villages braced for a third night of bitter cold and bad weather.

Interior minister Socrates Hasikos said all district offices would be on standby 24/7 to respond to emergencies.

Villages cut off from heavy snowfall were running out of basic supplies as efforts to clear roads and restore access continued for the third day running.

Communities in the Nicosia district have asked for milk, bread and water, the chief of civil defence operations, Ioannis Avlonitis said.

Dozens of villages have been cut off since Wednesday when snow started falling in the mountains. The capital Nicosia even got its first glimpse of snow in years this week.

Hasikos said the state did not have the kind of equipment available in other countries that regularly experience such weather but said that they were using all private and state equipment to address problems.

For the past few days, several departments including civil defence, district offices, police and the public works department have been working to clear roads and address problems from heavy snowfall, storms, and strong winds.

Electricity authority crews have had to respond to power failures and police had to deal with a number of road accidents in the Famagusta region where a bolt of lightning was thought to have caused a power failure in the morning, fixed later in the day on Friday. A supermarket and a basement also flooded in Famagusta and fire services were called in to respond.

In Paphos, banana plantations were spoiled and many crops were also damaged in the Famagusta region.

Community leaders have said in their villages water pipes have frozen while people were stuck indoors because the roads were too slippery.

“I’ve lent the community’s car to a young man who goes round the village to help out the old people fetching them bread and milk,” said Spilia’s community leader, Antonis Karis.

Amiandos’ community leader Kritonas Kyriakides said it was too dangerous for people to drive. “They’ll have to shop, what can they do? They’ll walk,” he said. He added people were running out of firewood and heating fuel.

But with the weather man promising better weather on Saturday that should help clear roads and free all villages in the next few days. Traffic police has also prepared a safety plan for Cypriots looking to enjoy the snow. Head of traffic police Demetris Demetriou visited Troodos to size up the situation. He said people should really avoid driving, especially if they do not have four wheel drive cars.

Temperatures are expected to rise by up to four degrees Celsius on Saturday, and rise again by a further four or five degrees on Sunday, the met office said.

 

 

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Crowd breaks through barrier on Mandela’s last day of lying in state

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Late South African President Nelson Mandela lying in state

Late South African President Nelson Mandela lying in stateTENS OF thousands of mourners, some breaking through police barriers, flocked to South Africa’s central government buildings on Friday to say a personal goodbye to anti-apartheid hero Nelson Mandela on the final day of his lying in state.

About 100,000 mourners had paid homage to the former president, a global symbol of reconciliation, over the course of the three days with more than 50,000 paying their respects on the last day.

Such was the crush of people wanting to see Mandela’s body in the Union Buildings in the capital Pretoria, that the government had asked others to stay away from the park-and-ride facilities set up to take mourners to the area.

There were moments of tension as police turned people away.

At the Pretoria Showgrounds, one of the park-and-ride points, the crowd broke through the metal entrance gate when officers tried to stop people coming through. Some fell to the ground and hundreds streamed past before order was restored.

On another access road, police had to force back people trying to break through crowd barriers.

The day ended without further incident as the body of South Africa’s first black president, who died last week aged 95, was moved by police motorcade back to the country’s main military hospital for a final night.

On Saturday, his body will be flown to the Eastern Cape province for the funeral on Sunday at his ancestral home in Qunu, 700 km south of Johannesburg.

The arrival of an army of reporters, photographers and television crews for the funeral has created a security nightmare for South African authorities – and the chance to make a quick buck for enterprising locals.

In Pretoria, many people expressed disappointment at being prevented from filing past his casket.

“I am really angry, we tried for two days now to see Mr Mandela and thank him for changing this country and bringing us together. Now we have to go home with heavy hearts,” said Ilse Steyn of Pretoria.

Winding queues had snaked for kilometres from the government site perched on a hill overlooking the city, well into the heart of the capital.

“I don’t mind waiting, today is the last day and I must say thank you. I am who I am and where I am because of this man,” said Johannesburg resident Elsie Nkuna, who said she had taken two days off work to see Mandela.

Filing past the coffin, some pausing to bow, mourners viewed the body laid out in a green and gold batik shirt, a style that he wore and had made famous. His face was visible. His grandson Mandla sat beside the coffin, acknowledging mourners with smiles.

In the heat of the South African summer, army chaplains and medics handed out bottles of water and sachets of tissues.

Some people had been queuing since Thursday.

“We were hungry and thirsty and did not have money for food. The thought that I must be here to pay respect kept me going,” said Leena Mazubiko, who had travelled from eastern Mpumalanga province.

In South Africa’s small neighbour Swaziland, Africa’s last absolute monarchy, pro-democracy activists said police broke up a Mandela memorial service yesterday at a Lutheran church in the commercial capital of Manzini.

“The police stormed the venue and broke up the memorial and everyone was told to go home,” said Lucky Lukhele, the spokesman for the Johannesburg-based Swaziland Solidarity Network.

The week of mourning since Mandela’s death on December 5 has seen an unrivalled outpouring of emotion for the statesman and Nobel peace laureate, who was honoured by a host of world leaders at a memorial service in Johannesburg on Tuesday.

But the homage to Mandela has not been without controversy.

South African President Jacob Zuma, who is leading the national mourning ceremonies, was booed by a hostile crowd, a worrying sign for the ruling African National Congress (ANC) six months before elections.

There has also been a storm of outrage and questions over a sign-language interpreter accused of miming nonsense at the same memorial. The signer has defended himself, saying he suffered a schizophrenic episode.

Compared to Tuesday’s mass memorial, Sunday’s state funeral at Qunu will be a smaller affair focusing on the family, but dignitaries, including Britain’s Prince Charles and a small group of African and Caribbean leaders, will also attend.

Iranian Vice President Mohammad Shariatmadari will also be at Qunu, but former U.S. President Bill Clinton, who had been expected at the funeral, will not attend. Civil rights activist Jessie Jackson was on the list to attend the funeral.

The Qunu event will combine military pomp with traditional burial rituals of Mandela’s Xhosa clan.

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In landmark for EU, Ireland leaves its bailout behind

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Ireland's Finance Minister Noonan smiles at the start of a EU finance ministers meeting in Brussels

THREE YEARS after going cap in hand to international lenders to avert bankruptcy, Ireland has officially ended its bailout in a landmark for the euro zone’s efforts to resolve its debt crisis.

Ireland has cut spending and raised taxes to rebalance the economy since seeking emergency help from the EU and IMF, meeting every major target under the 85bn euro programme and enduring little public unrest.

“This isn’t the end of the road. This is a very significant milestone on the road,” Finance Minister Michael Noonan told a news conference on Friday.

“But we must continue with the same types of policies.”

The country of 4.6m is funded into 2015 thanks to debt issuance over the last 18 months. It is showing the way to Greece, Portugal and Cyprus – which have also had sovereign bailouts – and Spain, which has had help for its banking system.

With more than 22bn euros of cash in hand, almost twice the amount initially envisaged by its lenders, Ireland has insulation against market shocks and the economy is forecast to grow by about 2 per cent next year.

Unemployment has fallen below 13 per cent, from a 15.1 per cent peak in 2012, and Dublin is confident enough to do without a backup credit line.

In a sign of European admiration for Ireland’s efforts, Noonan received an award from the German-Irish chamber of commerce for his role in the bailout exit and “huge positive impact” on relations between the countries.

But there is a sharp divide between capital and countryside and smaller towns. Jobs are being created and house prices rising in the former, while the latter are still strewn with empty properties from the “Celtic Tiger” boom years and closed down shops. Economic recovery is also heavily reliant on exports.

While pledging to maintain fiscal discipline, Noonan said he will consider income tax cuts in the next two budgets to give the economy some support.

Ireland could cut its total debt load from a peak of 124 per cent of gross domestic product this year to 116 in 2014 by using its cash buffers, Noonan said.

“They have to be prudent. You can’t just cut taxes for the sake of it,” said Alan McQuaid, chief economist at Merrion Stockbrokers. “It’s a good story for the EU and it’s a good story for us (but) we’re still at the mercy of global factors.”

Leaving the bailout is an important achievement but Prime Minister Enda Kenny’s government still has plenty of hurdles to overcome as it seeks to win over the Irish people, with an election due by early 2016.

Kenny, who inherited the bailout when he came to power in 2011, will start efforts to win back voters in a state of the nation address on Sunday evening, the date he has earmarked as the official end of the bailout.

Ireland’s costs to borrow money for ten years have now fallen below 3.5 per cent, from a high of 15 per cent just eight months into the bailout, but many people, particularly outside the capital, have yet to feel better about their finances.

“They say it’ll turn around, but by the time it turns around people will be devastated, broke,” said Michael Moore, a pensioner in Dublin. “They just don’t seem to give two damns.”

Another concern are the banks, which drove the country to seek help and are now taking centre stage again. A central bank assessment of balance sheets showed capital adequacy ratios at Bank of Ireland, the only lender not fully owned by the state, dropped more than expected.

“The phase of additional European countries going into programmes, and those in programmes being uncertain about their future, that has passed now and the euro zone is quite strong again,” Noonan said.

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59 rare Beatles songs to be released next week

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Former member of The Beatles, Ringo Starr in concert

RARE recordings of 59 songs by the Beatles will go on sale for the first time on Tuesday when Apple Records makes them available for download.

Apple, a label founded by the Beatles in 1968, said it would release a series of tracks from the early 1960s that were previously only available as bootleg recordings.

Among the songs to be released on iTunes are versions of “She Loves You”, “A Taste of Honey” and “There’s a Place”, as well as outtakes, demos and live performances recorded for BBC radio.

A spokeswoman for Apple Records declined to explain the timing of the release or comment on speculation that it was aimed at extending copyright over the material.

In 2011, the European Union ruled that copyright over sound recordings should be extended from 50 to 70 years from next year, but only for recordings released before the 50-year term had expired.

The bulk of the Beatles tracks available for download from Tuesday were recorded for the BBC in 1963 but not released.

Others have already capitalised on the changes to EU legislation to maintain control over their back catalogues.

The legislation has been dubbed “Cliff’s law” in Britain for the additional royalties it would provide for veteran rocker Cliff Richard, whose songs had been starting to fall out of copyright.

In late December last year, Sony Music released a compilation of Bob Dylan recordings from 1962 and 1963, giving away the reason for the move with a frank subtitle: “The Copyright Extension Collection, Vol. 1.”

Sony only released 100 copies of the Bob Dylan recordings. It was not immediately clear whether Apple Records would limit downloads of the Beatles songs.

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Christofias had been warned from 2010 of looming disaster

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Former president Demetris Christofias

By George Christou

IT IS THREE years to the day, since Demetris Christofias, the president at the time, was sent a stern letter (reproduced in full on the right) by then president of the European Central Bank, Jean-Claude Trichet, urging him to rein in public spending and bring the budget deficit under control.

The letter, co-signed by then Governor of the Central Bank of Cyprus, Athanasios Orphanides, said that “Cyprus is one of the countries where the need for policy actions is particularly urgent” and noted that “the implementation of fiscal consolidation has to be a key priority for the 2011 Budget and beyond.”

The ECB had been concerned about the spreads of Cyprus government bonds which had been rising, an indication that the markets considered the risk bigger. This was because the Christofias government had refused to take adequate measures to cut state spending and reduce the budget deficit.

According to the ECB, the deficit should have been at 4.5 per cent of GDP in 2011 and 3 per cent in 2012, but according to its own calculations with which the European Commission agreed, it would be in the region of 5.7 per cent for both years. Apart from additional measures, it also urged the government to have concrete contingency plans “which can be quickly implemented in case the consolidation targets are at risk.”

Christofias not only ignored the warnings of the letter, which was copied to finance minister Charilaos Stavrakis, but he did not even reply or acknowledge its receipt. Five months later, in May 2011, Cyprus was excluded from the markets, its government bonds attaining junk status. This was the start of the economy’s collapse.

Christofias’ oft-repeated excuse for his inaction was that nobody had warned him about the expansion of the banks and the dangers this entailed. In an interview, published in Kathimerini three weeks ago, he said the following:

“Why was I at odds with Orphanides? Because we talked 100 times, he sent me as many letters, but never in any discussion or any document was there mention of the banks. He never told me that the banks were engaging in the expansionary policy… He (Orphanides) spoke to the infamous (investigative) committee. Did he say he warned the president about the situation of the banks? Never.”

Yet the Trichet letter did inform Christofias about the large size of the banking sector and the negative effect unhealthy public finances could have on it. It was expressed in technical terms but there were plenty of economists in his government, who could have explained the jargon to him.

Trichet said in letter said: “Although Cyprus’ sovereign debt market has a limited size, significant concerns exist. These concerns are particularly relevant in view of the large size of the Cypriot banking system, which may produce negative feedback loops between financial sector and public debt. Safeguarding market confidence in public finances and in the stability of the financial system has to be a key objective for Cyprus at the current juncture.”

The dangers posed to the banking system by the inability to put public finances on a sound basis could not have been made clearer. Yet Christofias ignored this clear warning and did nothing. The spreads on government bonds continued to rise and by April Cyprus was unable to borrow money from abroad.

The yields and spreads of Italian and Spanish bonds also surged in 2011, but because the governments of both countries had heeded the warnings to take measures to reduce their respective deficits, they were helped out by the ECB and overcame the problem. Neither was excluded from the markets.

Earlier this year, the ECB disclosed the purchases of government bonds it made to help governments in the euro area.  The list included Italy (€99bn) and Spain (€43.7bn) whose governments behaved responsibly when warned by the ECB.  A striking absence from the list, which also included Greece, Ireland and Portugal, was Cyprus.

Unfortunately, in 2011 Cyprus had a president who still claims that he was not warned by anyone and a finance minister who thought it best to look the other away.

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Cyprus’ startup ecosystem

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FEATURES STARTUPS

By Poly Pantelides

WHEN Greek Cypriots want to express sympathy they say “manamoure” – an ubiquitous expression of commiseration roughly translated as “poor thing”.

Your cat died? Manamoure…

Your bank card got stolen? Manamoure…

Your business failed? “In Cyprus, you’d be told, ‘manamoure’, not: ‘what did you learn?’”, said Paris Thomas, one of the founders of Cyprus’ first and only business accelerator Chrysalis Leap.

Chrysalis Leap comprises of a diverse team of lawyers, academics, consultants and entrepreneurs who have been making waves in Cyprus and abroad and have just finished their first round of nurturing clean technology startups who pitched some awesome business ideas to investors on Friday as part of a Demo Day.

Pitches included a way to use fallen leaves to create sound absorbing materials, a stand-alone mobile solar panel that starts producing energy within a minute of being plugged in to an online platform bringing together people with unwanted, reusable, furniture and the designers who can give them a new lease of life.

It was the culmination of months of work for the startups, but also a message of bigger things to come both for Chrysalis Leap and the blooming startup scene in Cyprus.

Thomas has been doing plenty of pitching himself along with environmental lecturer Alexandros Charalambides, the Chrysalis Leap founder who roped the rest of them in. Charalambides and Thomas are an award winning duo in their guise as ENERMAP, a team that was awarded a prestigious award last year via an event organised by KLIMATE-KIC, Europe’s largest private public-private innovation partnership. ENERMAP plans to create an online displaying the energy consumption of buildings and have been given tremendous access to experts and training.

Earlier this summer, Chrysalis Leap announced it was launching an accelerator programme to guide Cyprus-based people create fully-fledged business plans on sustainable and cleantech projects and hook them up with investors who might fund them. Sixty-five teams applied and five teams made it through the final stage. Sponsored by Ernst and Young (EY) who shared their know-how and experience, Chrysalis Leap – itself a startup – introduced the five teams to investors and professionals at the Royal Hall.

ENERMAP have just completed a tour of San Francisco’s Silicon Valley, darling of startups, involving two weeks of networking and more networking and pitching. This is what they learned: “you are a lion and you’re waiting for your prey,” said Thomas. It was a joke to describe the spirit of going for it that can get that coveted business card for Google’s green business guy, Rick Needham, who can put you in touch with the right people. Entrepreneurs need the tenacity of a lioness huntress.

The people behind Chrysalis Leap have played a major role in helping create a Cyprus’ startup ecosystem. Founders include Marina Theodotou, the woman behind the popular TEDxNicosia, and TEDxNicosia speaker Eloiza Savvidou who has been sharing her expertise in corporate, commercial, and intellectual property law.

Some of the teams that joined the Chrysalis Leap accelerator programme – going from idea to business plan over several intense months – have already received recognition abroad through global competitions.

One startup, Aqualligence, has designed a smart system to monitor water quality 24/7 via low cost online sensors that can have wide-reaching implications and tap into a multi-billion dollar industry.  Another, MICAPE, that has developed a way to capture the wind power of cars as they drive in motorways, has won second place in an Athens’ based cleantech national contest.

The organisers, Industry Disruptors-Game Changers promote entrepreneurship in Greece, South East Europe and the Eastern Mediterranean. One of its founders, Carla Tanas, said they will be launching more events in Cyprus early next year. They have already helped Cyprus join Global Entrepreneurship Week (GEW) that brought participants from 140 countries together in November, with a little help from the internet. Cyprus also hosted its first Startup Weekend in November, while the Cyprus Business Angels Network Cyban has been set up to fund high growth businesses.

Startups in Cyprus and the network that supports them  has a global focus, and a requirement that many investors have, including Cyban, is that businesses have the potential to grow outside the confines of the island.

Chrysalis Leap themselves have just received funding from Europe’s largest public-private innovation partnership, Climate-KIC. The Climate-KIC people are definitely impressed and have announced a partnership with Chrysalis Leap next year. Chrysalis will also be teaming up with SAP Startup Focus, an initiative from a leading business software manufacturer.

Chrysalis’ Charalambides said the catalyst for Chrysalis Leap was the knowledge and experience they were amassing through ENERMAP. “We thought, ‘why keep it to ourselves?’”.

Visit www.chrysalisleap.com  or look for them on Facebook or twitter @chrysalisleap

 

 

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ACCA chief calls for ‘expert’ regulation

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©Vaal PhotographyHelen Brand, CEO ACCALondon28.07.2010

By Angelos Anastasiou

THE GLOBAL financial crisis, dating back to the collapse of Lehman Brothers, Arthur Andersen and Enron, continues to ripple its devastating after-effects, while regional economies, such as the European Union, scramble to find convincing answers to impossible questions.

But some experts believe that a lot of these meltdowns could have been prevented, or at least suffered milder consequences, had there been better rules to ensure ethics and transparency in the financial services sector and the individuals working therein.

Perhaps ‘expert’ regulation is better than tight regulation, but whatever the outcome of this argument, professionals such as accountants, lawyers and financial advisers in Cyprus and around the world need to take a serious look at what needs to be done to fix the problem.

One of the people at the forefront of the crusade for high levels of professionalism and good corporate conduct is Helen Brand, OBE, Chief Executive of the Association of Certified Chartered Accountants (ACCA) for the past five years.

Placing a high premium on the ethical aspect of practicing and emphasising personal responsibility in professional conduct, Brand, who was awarded her OBE for services to accountancy, aims to steer the organisation towards further growth by entrenching these values at par with professional competence.

And she plans to do it all by relying on a ‘pull’ strategy. That is, by ensuring that her ‘product’ – as she calls ACCA members – is so excellent that ‘customers’ – employers – actively seek it.

“The biggest challenge we are facing is meeting the demand there is for professional accountants, particularly in emerging economies such as Indonesia, Bangladesh, Vietnam, Cambodia and, increasingly, sub-Saharan Africa. The skills that professional accountants bring are absolutely in demand and we’re working very hard to meet that demand.”

Difficulty to change tends to grow exponentially with size, but Brand has managed to create a huge organisation that is unusually responsive and proactive – a flexible behemoth. Her and her organisation’s response to the lessons of the US 2007-8 crisis is telling: “A lot of the 2008 crisis is down to behaviour” she says with a shrug, and, “I remember talking to a journalist at that time who said, ‘Why do you keep going on about ethics? I am not interested’ – it’s because ethics are absolutely fundamental!”

So how did that translate into action?

“In the past few years we’ve increased the content around professionalism and ethics, we’ve introduced testing around integrated reporting, sustainability reporting and those newer concepts that are about the future of the profession. We no longer say ‘every seven years we’ll review our syllabus’, we do it continuously. We look at practical experience, we look at the ethics module continuously – so that ‘staying relevant’ is really critical.”

In Cyprus this week, she met with businessmen, the Finance Minister, the Accountant General, and the Institute of Certified Public Accountants of Cyprus (ICPAC), with whom the ACCA maintains a formal partnership for well over a decade. She aimed to get an on-the-ground feel of the business and regulatory environment.

And now? “I can go back and tell everybody ‘get on with supporting the various parts of the Cyprus profession where we can be of help’,” she says with a smile, acknowledging that support is required, and that our economic outlook may not be as dire as some feared.

The March 16 and 25 Eurogroup decisions were devastating to the Cyprus banking sector and the economy at large, but crying over spilt milk is no use.

“What we have to do is to ensure the sustainability of businesses in that environment. From our point of view it’s making sure that our students and members have been equipped to look at the long-term in the middle of a crisis”, Brand says, adding that “some of the broader policy framework, whether it be taxation or SMEs, is the policy framework we would recommend from our research.”

Despite the circumstances the Cyprus economy has found itself in, the continuous development of the financial services sector can be “part of the recovery plan”, in Brand’s view.

Several challenges lie ahead, like the need for a concerted global effort to combat money laundering. Asked whether Cyprus has a money laundering issue, she declined to offer a firm position.

“I’m certainly not going to come here to specifically criticise Cyprus because I think it’s a pressure that governments everywhere feel. There has to be an international response to the issue.”

But what kind of contribution can Cyprus make to such a global effort, when its own people don’t seem to be able to work together even in crisis? We offered the ACCA chief executive a brief history of the persistent public rows between the current President and the Central Bank Governor and their respective predecessors – and asked her to comment: “I think the lines have to be clear, I think that’s the issue. What the Central Bank is responsible for and what it’s not, needs to be clearly defined for things to be effective. That’s what causes problems, when that clarity isn’t there.”

On the global debate of tighter-versus-lighter regulation of the financial services industry, she supports the former, while warning against overdoing it.

“What needs to be recognised is that overregulation can actually dampen the spirit of entrepreneurship or wealth-creation that’s absolutely necessary for these institutions, so you could get into a vicious cycle of regulation-regulation-regulation and no economic productivity.”

But she also speaks of the need for ‘expert’ regulation, which seems to be a nice way of criticising watchdogs for inadequate oversight, as “you need to look at those areas of particular risk and have the talent and capability within the regulatory framework to actually understand that risk, and then deal with it on a continuous basis in a very expert manner.”

Helen Brand is a strategist. One of the talents she was hired for by the ACCA is that of unwavering focus on the long-run, which she most decidedly possesses. Talking about the strains in the relationship between the president and the central bank chief, she commented on the fact that “in the UK there’s been a very clear division of responsibilities between the politicians and the central bank and that seems to have been a success”, obviously implying that Cyprus could (and should) look outward – to the UK, in this instance – if not for ready-made solutions, then at least for inspiration to come up with our own.

Accountants, executives, leaders and businesspeople the world over could all do the same – turn their eye to the UK for inspiration.

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Trying to create a country of cyclists? Good luck with that

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Most people in Cyprus think cycling is dangerous

By Poly Pantelides

CYCLING is a happy, healthy activity that is much cheaper than driving and going to the gym while governments could even benefit financially from investing in cycling infrastructure, but it will take some convincing yet, the head of Sustainable Mobility section of the public works department Michalis Lambrinos has said.

Over the next four days, from Monday and Thursday, a workshop will take place across Nicosia and Larnaca and that will draw largely from Dutch expertise on creating a country of cyclists. The Think Bike Workshop will culminate in an evening event on Thursday when politicians will be given a presentation of the workshop’s findings.

The event is the brain child of the Dutch embassy, one of the co-organisers along with the public works’ department, the Cyprus Tourism Association and the municipalities of Larnaca and Nicosia.

The Think Bike scheme first started as a collaboration between the US based Netherlands embassy and the Dutch Cycling Embassy, a public private network facilitating global knowledge exchange and business cooperation. The events are often organised with diplomatic posts, a testament to the Netherland’s ability to yield soft power by being ambassadors for cycling.

“The Dutch are among the top bicycle users in the world but that came to be as part of targeted efforts for decades, of building the infrastructure and prioritising bikes,” Lambrinos said. On the agenda for the Think Bike workshop are discussing technical solutions for Nicosia and Larnaca, site visits and problem-solving.

Those with memories spanning decades remember in Cyprus a time when students rode their bike to school and people pedalled places as naturally as people today drive cars. A regular Sunday outing before 1974 was a cycle from Nicosia to Kyrenia.

Today, if you took all the cars in Cyprus and put couples in each car, you’d fit them all with room to spare. Cyprus’ population of roughly 840,000 in the government-controlled parts had almost 470,000 licensed cars at the end of 2011, according to country’s statistical services, Cystat.

This is because people drive places, because it’s easier, because there are many roads for drivers but few cycle paths, and because people do not feel safe cycling. Lambrinos said that Cypriots often say cycling is dangerous “because it’s partly a numbers game and the more [cyclists in the streets] the better”.  And though authorities need to convince people to use bikes more, the biggest stumbling block is the lack of infrastructure, he said. Lambrinos said that surveys of road traffic suggest bike use in Cyprus lies at 1.0 per cent.

Compare this with the Netherlands where one person in three will use a bike as a main mode of transport, according to a European Commission’s poll for Future of Transport survey in 2011. Some Cypriots do use a bike for fun, but very few use it like the Dutch to, for commuting to work, a spot of shopping, or visiting friends. Most Cypriot cyclists load their bikes on to their cars, drive to a central spot, meet up with others and ride around a certain route before returning to their cars to go home again.

But to be fair to Cypriots, transport choices are scant and ill-thought. Some 89 per cent of Cypriots told researches for the same European Commission poll they used a car as a main mode of transport. But about 84 per cent of them also said they would use other modes of transport if they could transfer from one mode to another easily.

Cities in Cyprus have typically grown to accommodate private cars. As the cities grew, authorities addressed growing traffic problems by expanding the road network. The Think Bike workshop will discuss this on a practical level, Lambrinos said. “We want to analyse our planning and discuss how we can practically implement [proposed actions],” he said.

Nicosia municipality has an Integrated Mobility Plan that includes building a public transport network that actually works. The plan actually dates back to 2010, and Lambrinos said they would be looking at how it could be improved. The public works department also wants to draw up plans for the cities of Paphos, Larnaca, and Limassol.  Right now, cycle paths in cities are not linked up.

But though the communications department has been trying to get funding for more cycle paths, the finance ministry has been blocking efforts because of the debt crisis. “Last year it was the EU presidency, this year it’s been the bailout, and next year will be tight.”

There are some studies suggesting governments save many times over what they invest in cycling via reduced public health costs for example, Lambrinos said. But the politicians are not convinced yet, he said.

However, there has been more political vocal support of cycle paths lately from some politicians, including the mayors of Nicosia and Larnaca. Communications minister Tasos Mitsopoulos said this week they were reinstating a dormant group within the ministry whose aim is to promote bicycle use. And the Nicosia Integrated Mobility Plan stands a good chance of getting 2014-2020 EU funding which has the potential of being a game changer for the city, if handled right. The Think Bike workshop is a step towards that direction: learning from the experts.

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Tales from the Coffeeshop: From victimhood to moaner-hood

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If a picture paints a thousand words... Downer with Prez Nick earlier on Friday

By Patroclos

WE MEDIA folk have always loved to blow things out of proportion so it was inevitable that we would make so much out of the spell of cold weather that hit our martyred shores, presenting a bit of snowfall and low temperatures like a natural disaster, another ordeal for our long-suffering people.

True, we are not accustomed to this type of weather and temperatures were about 20 centigrade only a week ago, but it was just a bit cold for three days we had not entered an Ice Age 4. It was the weather they have in northern European countries for three to four months every year.

The CyBC with its network of island-wide reporters kept Trito radio audiences updated regularly about the snow, informing us on Wednesday morning about every village, in every district that a few flakes of snow had fallen – from Vavtsinia to Klirou.

“Snow even in Lythrodontas” announced the Wednesday morning presenter and arranged to get an eye-witness report from the CyBC’s very own snow correspondent in the village. “It stopped snowing now,” the snow correspondent reported when he finally went on air, which was a shame because we were all eagerly waiting to hear a full account of how the snow-flakes were falling in Lythrodontas.

 

ON THURSDAY morning the pancyprian moaning and crying began. Some 30 villages had been left without electricity because of problems at EAC sub-stations while overnight snow-fall meant that many roads could not be used.

Trito gave air-time to the moaning villagers, who railed on against the EAC which had failed to restore their power supply in the night. It did not matter that the snow had blocked the access of the Authority’s crews to sub-stations to carry out the repair work, because it was unacceptable for them to have no electricity for 12 hours. Why were police helicopters not used?

The blame was then shifted to the state. “What sort of state do we have that cannot clean our roads,” an indignant from Kakopetria asked. Another was seething because he had been left without milk as a result of the state’s failure to clean the roads.

TV stations, which like to make things even more dramatic found a few old people to tell them that they had run out of medicine and were in despair. We are fast becoming nation of professional moaners. From victimhood we have graduated to moaner-hood, because we live in an era of entitlement.

 

THE AUTHORITIES handled the situation pretty well. The roads were cleared, electricity supply was eventually restored and the villagers were able to get their milk and medicines by Friday.

By yesterday it was a beautiful sunny day and only our Olympian moaners, the farmers were still whinging, seeking pity and state compensation for the destruction of their crops by the cold.

State services might not have the equipment to deal promptly with snowfall and blocked roads but this is not Finland. This is Kyproulla and it would be a bit wasteful to invest in snow-clearing equipment that we would use once every 10 or 20 years, when it snowed in the hills, so villagers would not be left without milk for one day.

But there were some good guys as well. The mayor of Spilia was on Trito on Friday morning, informing listeners that the village had no water for three days because the pipes had frozen, that streets were still blocked because they were too narrow for snow-clearing trucks, but twice made it clear that he was not complaining, just stating the facts. A hero who, I am happy to report, showed the indomitable, true Cypriot spirit of the mountain villages, exemplified by the late Melis of Troodos, is not dead.

And he was not the only one. An elderly gentleman, interviewed in the snow outside Lefkara municipality, smilingly boasted he had eaten six loukanika, five pastourma, drank a ‘potsa of ooiski’ and was about to visit the mayor, whom he expected to offer him some zivania. It was before lunch-time. Not all is lost.

 

THE BASH patriotic camp was far from impressed with the Estragosha (S-300) extravaganza held in Crete on Friday as it opened old wounds, reminding them of the brief period in the late nineties when they believed the deployment of surface-to-air ballistic missiles would turn Kyproulla into a military power.

Alas, it all ended in humiliation with the Clerides government, which had ordered the Estragoshas at cost of 200 million Cy-pounds, eventually chickening out – the Turks had threatened to take them out if they were deployed – and not taking delivery of them.

They were taken to Crete in March 1999, abruptly ending the national euphoria that was fuelled by film footage of them being launched, on all the TV stations’ news broadcasts every night, for months after the contract with the Russians had been signed.

To save face, we wasted some more millions purchasing TOR-M1missiles for our air cover. This was a wiser choice as it had the approval of Turkey.

 

FOURTEEN-AND-A-HALF years after their delivery to Crete, Greece finally decided to try an Estragosha out and they invited our defence minister Fotis Fotiou to attend the minute-long event.

Fotiou was very impressed with what he saw and said: “It is really with feelings of pride that today I watched this spectacular trial launch of a spectacular weapon system.” The missiles were “a strong card for the protection of the national air space of Greece and Cyprus,” the minister concluded.

The eloquent spokesman of bash-patriotism Lazarus was having none of it. A day earlier he had written his column: “The Immediate termination of the exile of the S-300 missiles and their urgent deployment in Cyprus” was what the defence minister should have been working on.

I have an even better idea, even though it is unlikely to meet with Lazarus’ approval. We should sell the exiled missiles at a bargain price to an African dictator or some country with unfriendly neighbours, as we desperately need the cash. I see no reason why Greece which screwed our banking system and economy big-time, should benefit from this spectacular weapon system for free.

 

OUR STATE may be bankrupt but our all-devouring, self-serving, ruling elite still refuses to give the hapless taxpayer a break. For five months deputies have been trying to reduce the number of limos provided to officials of the bankrupt state with zero success.

The reason is that they are coming under pressure from cheap, money-grabbing officials refusing to surrender this privilege and claiming their position justified a car. These are the mega-parasites of Kyproulla who believe they have a God-given right never to pay for petrol, new tyres or a mechanic’s bill, even after their employer has gone bust.

After five months of consultations, deputies were supposed to approve new regulations reducing the number of officials eligible to limos, at Thursday’s session of the House, but they were unable to come to a decision because they were receiving letters from assorted mega-parasites demanding that they were included in the list of those eligible.

You’d expect people on 70 to 90 grand a year, to have a bit more class than to beg deputies to help them keep their limo when there is poverty and despair all round them. Deputies decided to take the issue back to the House in the new year, but I suspect the new law would be approved when it snows in Lythrodontas again.

 

THE PERMANENT Secretaries were initially going to lose the limo privilege but persuaded the government that this would be an injustice for the mega-parasite class.

This prompted the head of the European Programmes, Co-ordination and Development, who is of mega-parasite rank to write demanding that if perm secs were getting a limo so should he.

The government then asked for the director of the president’s office to be given a car, while Disy agreed to the request for a limo for the chief registrar of the Supreme Court. What self-respecting bankrupt state does not offer a limo to the chief registrar of its Supreme Court, for Heaven’s sake? We might be poor but we are not a pseudo-state.

 

WHEN it comes to scrounging from the state, our bash-patriots, who are supposed to be interested in nobler things than personal gain, are at the front of the queue. The new head of secret service KYP, retired National Guard General Andreas Pentaras, wrote to the House president informing him that he should be entitled to a limo.

The reason – the secret services were being upgraded by law which among its provisions stipulates that the head of KYP would enjoy the same benefits as the Chief of Police. And if the Chief of Police has a chauffeur-driven limo so should the Chief of KYP.

Our mega-parasites are not just self-interested and greedy, they are also rather childish. I bet KYP was upgraded at the demand of the self-regarding Pentaras, because I cannot think of any rational reason for the government to bother with such a thing.

 

THE PARTY that took the hardest line on the limos was Edek, whose socialists wanted to cut the list down to the bare minimum, as long as former presidents of House were entitled to a limo. As good socialists they were defending the inalienable right of their superannuated honorary president for life Dr Faustus Lyssarides, who was president of the House in the eighties, to keep his limo, and police chauffeurs.

Meanwhile, another former president of the House and bash-patriot Marios Garoyian, now just another Diko deputy, still has a chauffeur-driven limo paid for by the taxpayer and also gets two a grand a month allowance for a secretary he has no need for. I read that as deputy he is also being paid €650 monthly transport allowance and €1,000 per month allowance for secretarial services.

On the allowances he is getting a mega-parasite of Garoyian’s magnitude could employ three secretaries, or six part-time, and help reduce unemployment.

 

REGULARS, who were thinking that they might get to the end, without having to read anything about the self-styled destroyer of the banking sector, Professor Panicos, were wrong. We have to mention the complex-ridden Governor’s latest effort to make the survival of his hated Bank of Cyprus even more difficult.

The Professor, who appears to have made it his life’s objective to close down the BoC (he was probably turned down for a car loan and developed a psychosis) has now decided to turn the screw on the bank by forcing it to lower its ELA drawings, thus further reducing its low liquidity.

This is the same guy who has been encouraging people not to repay their loans to the struggling banks, by telling hacks that the banks would have to write off a part of loans in order to help customers make repayments.

It is becoming clearer every day that the professor, whose ultra-strict definition of NPLs was labelled foolish by the CEO of the BoC, will not rest until he makes sure that the banking sector and the BoC in particular has no chance of recovery.

 

WHY IS the ultra-strictness with which the professor treats Cypriot banks not extended to foreign banks? The Federal Bank of the Middle East was violating the capital controls imposed by the Central Bank for seven whole months, but he and his officials who were aware of it from day one, did absolutely nothing.

He wrote to the bank threatening penalties only after the CBC board was informed about the violations and forced him to take action. Was he doing a favour to the husband of his Akelite PA, Malcolm Williams, who is an advisor of FBME?

Interestingly his PA, Eleni Markadji and Williams repeatedly took out for dinner Hal Hirsch, the head honcho of Alvarez & Marsal, the company that Panicos chose to investigate, to restructure the BoC, as well as to sell its operations in Greece for peanuts. Why was Hirsch dining out with a guy who had an interest in seeing the BoC fail and made no secret of his wish to see it close down?

 

We went to press before there was any news about the joint declaration. Although there were rumours that an agreement was imminent we felt it would be premature to start celebrating, given how a disagreement over a comma has been known to lead to deadlock.

All indications were that there would be a breakthrough – Big Bad Al cancelled his departure on Friday while on his way to the airport, Turkey’s foreign minister arrived yesterday on an illegal visit to the north without our police arresting him and Prez Nik called an urgent meeting of the party leaders. But by 17.30 yesterday no announcement had been made.

This is why we will leave you with a statement made by the government spokesman last Monday, which says it all. “Everyone knows from experience that on the Cyprus issue one can be very close and yet at the same time be very far from an agreement. Even a single word can change everything.”

This was a serious comment, but it needs some special kind of nutcases on both sides to allow a single word to change everything

 

 

 

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Our View: Political parties only playing lip service to transparency

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Former Laiki top man Andreas Vgenopoulos

IN ONE of his recent public outbursts against Demetris Christofias and AKEL, the Mari explosion investigator Polys Polyviou openly accused the communist party of receiving funding from the disgraced Greek banker Andreas Vgenopoulos. His allegation drew an immediate denial from party chief who called the television show to say that Polyviou was lying and that he would face legal action.

It was the first time that someone had publicly named AKEL in connection with receiving funds from Vgenopoulos. There had been many rumours circulating, alleging that AKEL and DISY had each received in excess of €500,000, but neither newspapers nor television stations had dared repeat them so emphatically. Politis had ran a story on November 7 about the distribution of €2 million to political parties by Focus Maritime Corp, a company controlled by Vgenopoulos associate Michalis Zolotas, mentioning that two parties had received half a million each, but not naming them.

Interestingly, this was the same company that had paid €1 million into the bank account of the daughter of Christodoulos Christodoulou, a couple of months after he had stepped down as Governor of the Central Bank. Christodoulou has said that the amount was advance payment for 10 years of consultancy services that were to be offered by daughter’s company. The case is under investigation.

On the day that Polyviou made his allegation against AKEL, DISY issued a statement claiming that it had never received any money from Vgenopoulos. It admitted that it had received €500,000 to pay for students based abroad to come to Cyprus to vote in the 2008 presidential elections, but the money was raised by a group of ship-owners and transferred to the party through a Cypriot ship management company.

Understandably, no party wants to be associated with the man responsible for the collapse of Laiki, but the truth is that in 2008 Vgenopoulos was considered a reputable businessman and was the subject of glowing media reports. Back then parties were entitled to receive funding from him. He was neither the first nor the last banker that had made a big money contribution to political parties in Cyprus. In fact, party contributions by businesses are standard practice in all democracies.

The only difference is that in Cyprus there is no transparency. Such contributions are kept secret by the parties, not just raising suspicions of corruption but feeding it. AKEL may have not received money from Vgenopoulos as its party chief has said, but for months the rumours were that the banker had made a big contribution to party coffers. Rightly or wrongly, this was how many people explained the refusal of AKEL officials, including Christofias, to say anything negative about the banker in public, not even after his role in the bank’s collapse had been revealed.

As long as there is no transparency all the parties would be viewed as corrupt organisations, serving the interests of those who fund them. In the last few months, for instance, the DISY leadership has taken a strong stand against the Bank of Cyprus selling off the assets of big developers that have been unable to make loan repayments for years. This has sparked rumours that the party leadership is in the pocket of the big developers. We are sure this is not the case and the party’s stance is dictated by what it believes to be in the best interest of the economy, but without transparency people will always think the worst.

Despite pressure for more transparency from the Council of Europe the parties have been dragging their feet. They may all claim to agree to the adoption of the Council of Europe’s recommendations on party financing laws – known as the GRECO rules – but nothing has been done. Most parties are vehemently opposed to revealing the identities of those who contribute funds, on the grounds that transparency would discourage contributions. This may be true, but people who want to keep their party contributions secret are those who will ask for things in exchange from politicians. Vgenopoulos made his contributions through other companies, which may explain why all parties insist they received no funding from him.

For as long as the parties defend lack of transparency the clean-up of political life, they supposedly yearn for, will never materialise. Politicians will carry on having a bad name among the people and the political parties will continue to be viewed as agencies of dishonesty and corruption.

 

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Deal close but yet so far

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President Nicos Anastasiades called party leaders to a meeting yesterday to discuss the developments

By Stefanos Evripidou

THE SNOW on high may have started to melt yesterday but on lower ground, relations between the two sides on the island remained as cold as ice after Turkish Foreign Minister Ahmet Davutoglu’s arrival failed to deliver the goods, at least in public.

Expectations were high as the day started, after last-ditch efforts by the UN to clinch a deal on a joint declaration before Christmas appeared to bear fruit. By the end of the day, both sides reverted to their trenches, taking pot shots at each other, and leaving diplomats pondering the fact they are an inch from the finish line.

A UN bridging proposal to overcome the deadlock on the term ‘single sovereignty’ seemed to gain traction on Friday evening, prompting UN Special Adviser Alexander Downer to turn back from Larnaca airport where he was to board a flight home, and return to the capital for further consultations with the two sides.

Sources close to the talks predicted that yesterday would be a “big day” for the process.

Reflecting that view, President Nicos Anastasiades called an informal meeting of the party leaders yesterday morning to brief them on the latest. After the one and a half hour meeting, the president refused to comment on what might be expected next.

He told reporters, “wait and see”, indicating there might be something afoot in the afternoon following a meeting between Davutoglu and Turkish Cypriot leader Dervis Eroglu in the north.

Anastasiades added: “In no case will any decision of mine be taken without informing the public and providing the justification.”

Government spokesman Christos Stylianides noted that party leaders were told to remain on hold in the event that they need to be called back to the Presidential Palace for a fresh briefing “at any given time”.

Asked if the two sides were close to agreement, the spokesman said: “When it comes to the Cyprus problem, one could be very close and at the same time very far.”

As the day wore on, a tense silence emanated from the Palace as all eyes went north of the buffer zone to the joint press conference between Davutoglu and Eroglu in the occupied part of Nicosia.

A day earlier in Athens, Davutoglu appeared to extend a friendly hand to the Greek Cypriots when he said that it was important Cyprus remained a single state post-solution.

However, any notion of a thaw in relations was quickly swept away at the Nicosia press conference where Davutoglu gave his full public support to Eroglu’s handling of the talks so far, saying that the Turkish Cypriots are ready and willing to sit down at the negotiating table , arguing they have already proved they can be flexible.

The Turkish FM said he wanted to send three messages. First to the Turkish Cypriots that Turkey will continue to provide every support for a peaceful solution of the Cyprus problem. Second, to Anastasiades that now is the time for political will. He called on Anastasiades to avoid making tactical manoeuvres that would delay the process and meet with Eroglu to reach consensus on a joint declaration and start substantial talks for a comprehensive settlement. At the same time, Davutoglu argued that the declaration- a clear precondition for the Greek Cypriots- was not as important as the two leaders having the political will to solve this conflict.

A third message was sent to the UN and international community. Davutoglu warned that Turkey will not accept the continuation of an open-ended peace process so long as the isolation of the Turkish Cypriots continues.

For his part, Eroglu maintained that he has shown all the good will necessary to make progress.

Meanwhile, Davutoglu also met with Downer in the afternoon for over half an hour, though no statements were made afterwards.

The Turkish media continued to play up the chances of success, reporting that Turkish Prime Minister Tayyip Erdogan called his Greek counterpart Antonis Samaras on Friday to discuss Cyprus. Hurriyet Daily News quoted Davutoglu talking about the current “positive psychological atmosphere” which is favourable to finding a Cyprus solution.
“Hopefully this will is shared by everyone so that a vision that can bring peace to the island can be developed,” Davutoğlu said, adding once again that the election of Anastasiades had been a major turning point.
Across the dividing line and the Palace started to speak. In an unusually strong-worded statement, government spokesman Christos Stylianides said: “The Eroglu-Davutoglu statements have torpedoed any possibility of relaunching a meaningful dialogue on the Cyprus problem.”

Stylianides argued that the president has fought hard the last three months to overcome the deadlock and enter into fully-fledged negotiations with a constructive stance.

“The Turkish Cypriot leadership with the assistance of the Turkish side persisted on extreme and uncompromising positions. Under such conditions, the president is not willing to enter into a dialogue for the sake of dialogue.”

He called on the international community to help the volatile region of the Eastern Mediterranean finally enter a period of peace, stability and cooperation.

“The president and Greek Cypriot side will continue with their constructive stance, which emanates from the decisions and resolutions of the UN, believing that cooperation and stability in the region is to the benefit of all peoples in the region, especially the Cypriot people in their entirety, Greek Cypriots and Turkish Cypriots,” said the spokesman.

Leader of coalition partner DIKO Nicolas Papadopoulos said Davutoglu’s comments constituted “a monument to Turkish intransigence, provocation and arrogance”.

Meanwhile, Greek Cypriot sources close to the talks said it was hard to say there has been any progress since Friday but that they will wait to see if anything new comes from the Turkish Cypriot side next week and what it will look like.

Another source said it looked like there would be one more effort to overcome the deadlock on the wording of the joint declaration but he didn’t know when that would be.

A diplomatic source said a lot of people have been working very hard, not just in Cyprus, but around the world, to bring the effort 99 per cent to completion.

Regarding the seemingly negative climate, they said the Turkish Cypriots were engaging in theatrics to hide the fact that historic breakthroughs are about to be made.

“There is only one per cent to go. Cyprus is on the verge of a new and defining High-Level Agreement.”

Of course, the 99 per cent could be lost if the interested parties fail to stay focused on the end goal, they added.

 

 

 

 

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Bowlers and Warner put Australia in charge

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England bowler Tim Bresnan has words with Australian opening batsman David Warner on day 3 of the 3rd Ashes test match between Australia and England at the WACA in Perth, Australia, 15 December 2013. EPA/DAVE HUNT

David Warner punished a depleted and dispirited England with a brilliant century to help drive Australia to 235 for three and a dominant lead of 369 after the third day of the third Ashes test on Sunday.

The hosts reached stumps with Shane Watson, who had made 29 not out, and Steve Smith, unbeaten on five, at the crease and looking well on their way to a victory which would secure an unassailable 3-0 lead in the five-match series.

England’s hopes of keeping the series alive by avoiding defeat at the WACA had all but melted away in the fierce morning heat when they were skittled for 251 in their first innings.

They plummeted even further when their best bowler Stuart Broad was taken to hospital for scans on an injured foot and was unable to play any part in the final two sessions.

Warner took full advantage and, revelling in the lack of pressure afforded him by another superb performance by his bowlers, bludgeoned his way to his fifth test century in 127 balls with 16 fours and one six.

The 27-year-old brought up the milestone by cutting Graeme Swann for a boundary and celebrated with an extravagent leap into the air and a flurry of bat pointing towards the home dressing room.

It was the opener’s second hundred of the series and a sixth by an Australian batsman to none from the tourists, whose entire team have been outscored by Warner, Michael Clarke and Brad Haddin.

England, a pale imitation of the side that won the home Ashes series 3-0 earlier this year, had their chances to stop his progress but wicketkeeper Matt Prior missed two stumping opportunities when the batsman was on 13 and 89.

They finally had their man for 112 when Warner holed out to Ben Stokes at mid-on attempting to smash Swann for a second huge six in one over.

Chris Rogers shared an opening partnership of 157 with Warner, scoring his fourth test half century at a more pedestrian pace before being caught for 54 by Michael Carberry at point off the bowling of Tim Bresnan.

MISERABLE DAY

Australia captain Clarke departed for 23 as the evening shadows crept across the sunbaked ground, bowled through the gate by Stokes.

The wickets were rare high points on a miserable day for England, who had resumed in the morning on 180 for four in reply to Australia’s first innings 385.

It was not much of a chase, though, and they lost their last six wickets for the addition of just 71 runs as Mitchell Johnson, Ryan Harris and Peter Siddle reprised their aggressive but disciplined pace assault.

Ian Bell was out leg before for 15 from the third ball of the third over and his overnight partner Stokes followed for 18 soon afterwards to give Johnson his first victim in more than 40 overs of play.

Prior (eight) was caught behind to give Siddle his second wicket and Broad (five) lasted 23 minutes before he was dismissed lbw by Johnson (2-62) with a full delivery that smacked into his boot.

That dismissal took on an extra dimension after lunch when Broad failed to come out to field having been sent off to a local hospital to have an X-ray.

Harris (3-48) had Bresnan caught behind for 21 to take the first wicket with the new ball and Siddle finished with 3-36 after James Anderson (two) spooned one to George Bailey at short leg to bring an end to the innings.

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Ukrainians mass for new anti-government rally as EU halts trade deal

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Ukrainian pro-European protestors carry a mask of the Ukrainian President Victor Yanukovych during a rally on the Independence Squire in Kiev, Ukraine, 15 December 2013.

Thousands massed on Sunday for a rally against President Viktor Yanukovich just days before he heads for a meeting at the Kremlin which the opposition fears will slam the door on integration with the European mainstream.

Minutes before the rally, EU enlargement chief Stefan Fuele said on Twitter he had told Ukraine last week he was suspending work on a trade-and-political agreement, saying Kiev’s arguments to improve terms had “no grounds in reality”.

Street protests erupted after Yanukovich’s decision on Nov. 21 to walk away from the agreement with the EU, after years of careful preparation, and turn to Moscow, Kiev’s former Soviet master, for aid to save Ukraine’s distressed economy.

Yanukovich’s policy swerve, while backed by many in Russian-speaking east Ukraine which is his powerbase, sparked huge disappointment and anger in western and central areas where people see Europe as their proper place.

The weeks-long stand-off between demonstrators in central Kiev and the authorities took on increasing geo-political overtones with the arrival of U.S. Senator John McCain who was due to make a speech at the sprawling protest camp.

Several Western politicians, from Berlin and Brussels, have paid morale-boosting trips to protesters on Independence Square – drawing denunciation from Russian Prime Minister Dmitry Medvedev as “crude” meddling in Ukraine’s affairs.

The movement began as a low-level pro-EU protest. But after a police crackdown on a group of mainly students and a face-off between police and protesters last Wednesday, it has broadened into a general outpouring of anger against perceived sleaze and corruption in the country Yanukovich has led for four years.

Protesters characterise it as a battle for Ukraine’s soul.

McCain is the latest of a string of European and American dignitaries to tour the sprawling protest camp set up behind barricades of benches, metal barriers, supermarket trollies and wire netting on the square – known locally as the ‘maidan’.

“Incredible display of patriotism at the ‘Maidan’ tonight,” McCain tweeted, after meeting Foreign Minister Leonid Kozhara.

McCain later met opposition leaders – the former boxing champion Vitaly Klitchko who leads the UDAR party, former economy minister Arseny Yatsenyuk and far right nationalist Oleh Tyahnybok – and was to speak later Sunday to protesters.

Though Yanukovich has offered up the heads of two minor officials he has shown no sign of meeting the opposition’s main request for the dismissal of his prime minister. Talks he had with the opposition on Friday went nowhere.

Yanukovich himself is scheduled to travel to Moscow to meet Russian President Vladimir Putin and tie up agreements to help Ukraine’s creaking economy, possibly by securing cheaper prices for gas and credits.

The opposition fears, however, that Yanukovich may be taking the first steps towards joining a Moscow-led customs union, together with Belarus and Kazakhstan – which they see as an attempt by Putin to re-create the Soviet Union.

Klitschko’s UDAR party called on Sunday for the dismissal of Andriy Kluyev, one of Yanukovich’s closest security aides, whom the opposition says was behind past attempts to break up the protests by force.

SMOKE, ROCK AND LASER

Smoke rose from scores of wood-burning braziers where protesters crouched for warmth on Independence Square on Saturday night. A popular Ukrainian rock band, Okean Elzy, belted out numbers while green laser lighting streaked across the sky to spell out ‘Ukraine loves the EU’ on the side of the cavernous Soviet-era post office.

Thousands, their bedrolls over the shoulders, shuffled onto the square, squeezing their way through a tight human channel of security committee officials checking for possible ‘provocateurs’.

“I heard he (McCain) was here. It’s nice that they know of us, that they remember us. It is great that they support us,” said Volodimir Tarabanov, 28, who works for a delivery company in Kiev.

Crowds sang the Ukrainian national anthem repeatedly throughout the night and chanted “Glory to Ukraine!, Glory to Heroes!”. As dawn broke on the square, priests intoned prayers to the protesters from a huge screen hanging over the square.

Apart from those on the ‘Euro-Maidan’, thousands of Yanukovich supporters staged a rival rally in Kiev on Saturday, many bussed in from Donetsk and other cities in eastern Ukraine.

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Euro Zone to share costs of bank closures gradually- Lithuanian proposal

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The cost of closing down a euro zone bank will initially be borne almost fully by its home country, but the obligations of euro zone partners will gradually rise to be shared equitably after 10 years, under the terms of an EU proposal seen by Reuters on Saturday.

The proposal, prepared by Lithuania which holds the rotating presidency of the European Union, will be discussed at an extraordinary meeting of senior EU officials in Brussels on Monday, Dec. 16.

Separately, several European finance ministers and senior EU officials will meet again in Berlin on Monday to try to make further headway on a compromise for rules to wind down stricken banks, senior euro zone sources told Reuters on Sunday.

The meeting will, in essence, include the same group of finance ministers and senior officials who met in Berlin on December 6, the sources said.

After a financial storm that toppled banks and dragged down states from Ireland to Spain, countries are considering a fresh blueprint outlining what to do when a bank fails, a critical second pillar of a wider reform dubbed “banking union”.

Sealing a deal ahead of an EU summit in Brussels Dec. 19-20 will allow Germany’s Chancellor Angela Merkel and her peers to trumpet an important overhaul of banking, although their readiness to share the costs of failed lenders, a central tenet of banking union, may fall short of what had been hoped.

Under the proposal, the costs of closing down a bank in the first year of operation would be fully covered by a fund set up by the home country where the bank resides.

Such funds would be set up in every euro zone country and each would be filled from fees paid in by banks in the respective countries, amounting each year to 0.1 percent of all covered deposits they hold.

Such funds would reach their full size of 1 percent of all covered deposits after 10 years, but in the first year each would have only 0.1 percent of all covered deposits in a euro zone country, then 0.2 percent in the second, and so on.

If the accumulated money from bank fees in a home country in the first year is insufficient to finance the closure of a bank, other funds in euro zone countries would be expected to contribute up to 10 percent of their accumulated money to help.

In the second year, the home fund would only be obliged to use up 90 percent of its accumulated funds to finance the cost of closing down a bank before it could call on its euro zone partners, who would be required to chip in with up to 20 percent of what they hold to help.

The obligation for the home country before it could call on partners would decrease by 10 percent each year and the potential obligation for other euro zone countries would rise by 10 percent.

In this way, by the tenth year, the home country fund would only have to contribute 10 percent of their funds before calling on its euro zone partners who, like the home country, would be obliged to contribute whatever was required – up to 100 pct of their total funds – to pay for the bank closure.

If the cost of closing down a bank in any of the 10 transition years turns out to be bigger than the combined home country contribution and the proportionate percentage help of other funds, the home country fund could impose an additional levy on its own banking sector.

If that were still insufficient, the government of the country in which the bank is located could provide bridge financing, to be repaid from bank fees later, or if it does not have the cash, it could ask for a programme from the euro zone bailout fund ESM, like Spain did in 2012.

All the national funds for closing down banks would be merged into one Single Resolution Fund for the euro zone after 10 years and from that moment the Single Resolution Fund would finance all bank closures, fully mutualising risk.

Setting up the Single Resolution Fund and the complex risk and cost sharing arrangement over the 10 transition years is to be enshrined in an intergovernmental treaty, which is to be negotiated by euro zone countries by March 1, 2014, the Lithuanian proposal said.

The use of Single Resolution Fund would be decided by the Board of the Single Resolution Authority, made of up representatives of euro zone countries and institutions.

The Board would vote by qualified majority, rather than unanimity, the Lithuanian proposal said.

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Death toll in Syrian bombing raid on Aleppo rises to 76

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Seventy-six people, including 28 children, were killed on Sunday when Syrian army helicopters dropped “barrel bombs” on the northern city of Aleppo, the Syrian Observatory for Human Rights said on Monday.

Barrel bombs are explosive-filled cylinders or oil barrels, often rolled out of the back of helicopters with little attempt at striking a particular target but capable of causing widespread casualties and significant damage.

The Britain-based Observatory said that rebel groups in Aleppo issued a statement asking civilians in government-held parts of the city to move away from state security buildings, which they said would be targeted in retaliation for the bombings.

President Bashar al-Assad’s forces, battling rebels in a 2-1/2 year conflict that has killed more than 100,000 people, frequently deploy air power and artillery against rebel-held districts across the country.

They have been unable to recapture eastern and central parts of Aleppo, which rebels stormed in the summer of 2012, but they have driven rebel fighters back from towns to the southeast of the city in recent weeks.

The conflict has grown sectarian, with majority Sunni rebels battling Assad’s own Alawite sect and Shi’ite militia.

The Observatory – which has a network of opposition, pro-government and medical sources – also said on Monday that rebels in northern Aleppo province were threatening to strike two Shi’ite villages they have surrounded with missiles if barrel bombs were used again by the army.

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Cyprus shipping registry marks 50 years

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Merchant shipping in Cyprus has traditionally been, and continues to be, a pillar for economic growth, currently employing over 4,000 people and contributing 5.0 per cent to GDP, minister of communications and works said on Monday.

In an address marking the 50th anniversary since the founding and operation of the Cyprus registry, Tasos Mitsopoulos highlighted the successes that the Cypriot maritime industry had achieved since its birth, and reaffirmed the government’s commitment to supporting and facilitating the industry’s continued growth through tax and other incentives, as well as continuous improvement in the quality of services provided.

The first merchant shipping laws in Cyprus were passed in 1963 with Famagusta designated as the port of registry.  By 1974 the Cyprus merchant fleet had grown significantly.

However, the Turkish invasion of 1974 caused major disruptions, and the registry had to be reconstructed with Limassol designated as the new port of registry.

The beginning of the 1980s found Cyprus 32nd globally in fleet size.

Today Cyprus is in 10th place globally and 3rd in the EU in fleet size, with 1,857 seagoing vessels and a total tonnage of 21 million.

An elected member of the Council of the International Maritime Organisation since 1987, Cyprus won re-election earlier in December with the second-largest number of votes it has ever received.

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