Home > News

Hello Dolly

Search Results : Europe\’s

Eurozone unemployment rate hits record high

Apr 042013

Eurozone unemployment rate hits record high Unemployment rose to a record high of 12 percent in February in the Eurozone, according to the latest data released by the EU’s official statistics agency.

The Belgium-based Eurostat said on Tuesday that some 19.07 million people in the 17-member currency bloc are looking for jobs, up by 1.01 percent from the same month last year.

“Such unacceptably high levels of unemployment are a tragedy for Europe,”said a spokeswoman for EU Employment Commissioner Laszlo Andor. “The EU has to mobilise all available resources to create jobs…young people in particular need help,” she said.

The figures and a weak manufacturing sector report added to the gloom after data earlier this year had encouraged some hope the European economy might finally have touched bottom.

Analysts suggested Tuesday’s reports pointed instead to worse to come, with the jobless queues likely to grow as the debt crisis continues to sap the economy.

Youth unemployment

The highest unemployment rates in February were found in Spain with 26.3 percent and neighbour Portugal, on 17.5 percent.

Greece was put at it 26.4 percent but this figure is for December, the latest available.

The lowest rates were 4.8 percent in Austria and 5.4 percent in Germany, Europe’s biggest economy.

With youth unemployment a huge cause of concern, Eurostat said that the jobless rate for under-25s ran at 23.9 percent in the Eurozone and 23.5 percent in the EU.

Among the countries with the highest youth jobless levels, Spain was on 55.7 percent, followed by Portugal on 38.2 percent and Italy with 37.8 percent.

Greece was the highest with 58.4 percent but this was also for December.

Howard Archer of IHS Global Insight said the figures marked a “dismal landmark” at 12 percent — already very close to the official EU 2013 forecast of 12.2 percent.

BRICS nations fail to launch new bank

Mar 282013

Leaders from the so-called BRICS group of emerging nations have failed to launch a much-anticipated new development bank to rival Western-dominated institutions like the World Bank.

After holding talks in the South African port city of Durban on Wednesday, leaders from Brazil, Russia, India, China and host South Africa agreed in principle to create a joint infrastructure lender but said further talks were necessary to finalise the plan.

“We are satisfied that the establishment of a new development bank is feasible,” said host President Jacob Zuma, in remarks that hint at little progress beyond an agreement reached in the Indian capital, New Delhi, a year ago.

“We have decided to enter formal negotiations to establish a BRICS-led new development bank,” he added.

Officially leaders had been expected to consider the bank’s establishment, but South Africa and others had hoped to formally launch a $50bn infrastructure fund at the two-day summit.

The mooted bank is seen as a way of gaining influence on the world stage, countering Europe’s dragging economic crisis and addressing the $4.5tn in infrastructure spending the BRICS are estimated to need over the next five years.

Instead of a $50bn fund BRICS leaders agreed only that the initial capital contribution would be “substantial and sufficient for the bank to be effective”.

Sticking points

Key sticking points included how projects would be distributed and where the bank would be based, diplomats said.

Al Jazeera’s Tania Page, reporting from Durban. said all of the BRICS members say they want to establish the development bank, but they have disagreements over fundamental details.

“First of all, China wants it in China, and President Zuma wants it in South Africa,” she said.

“Another problem would be dealing with exactly how much each country would invest in it and how much control each would have over it.”

Russian envoy to Africa Mikhail Margelov told AFP news agency his country had pushed for an incremental approach to establishing the bank.

“We believe in a step by step way of doing business,” he said, “we better talk about projects and then we talk about needed amounts of money.”

The next BRICS summit will be in Brazil in 2014, but the leaders will meet in Russia on the margins of the G20 in September.

Cyprus seals last-minute bailout deal

Mar 252013

Cyprus has clinched a last-ditch deal with international lenders for a 10 billion euro ($13bn) bailout that will shut down its second largest bank and inflict heavy losses on uninsured depositors, including wealthy Russians.

Final backing was received at around 01:00 GMT on Monday, after marathon talks between President Nicos Anastasiades and heads of the European Union, the European Central Bank and the International Monetary Fund – hours before a deadline to avert a collapse of the banking system.

The plan, swiftly endorsed by eurozone finance ministers, will spare the east Mediterranean island a financial meltdown by winding down Popular Bank of Cyprus, also known as Laiki, and shifting deposits below 100,000 euros ($129,000) to the Bank of Cyprus to create a “good bank”.

Deposits above 100,000 euros, which under EU law are not guaranteed, will be frozen and used to resolve debts, and Laiki will effectively be closed, with thousands of job losses.

An EU spokesman said no levy would be imposed on any deposits in Cypriot banks. A first attempt at a deal last week collapsed when the Cypriot parliament rejected a proposed levy on all deposits.

A senior source involved in the talks said Anastasiades had threatened to resign at one stage if he was pushed too far.

EU diplomats said the president, flown to Brussels in a private jet chartered by the European Commission, had fought to preserve the country’s business model as an offshore financial centre drawing huge sums from wealthy Russians and Britons.

“The liabilities paid off and whatever remains will come directly out of the bank accounts of the uninsured depositors,” Al Jazeera’s Jonah Hull reports from Nicosia.

‘Casino economy’

The key issues in dispute were how Cyprus would raise 5.8 billion euros ($7.5bn) from its banking sector towards its own financial rescue, and how to restructure and resolve the outsized banks.

The EU’s economic affairs chief Olli Rehn said there were no good options but “only hard choices left” for the latest
casualty of the eurozone crisis.

With banks closed for the last week, the Central Bank of Cyprus imposed a 100-euros ($130) per day limit on withdrawals from cash machines at the two biggest banks to avert a run.

French Finance Minister Pierre Moscovici rejected charges that the EU had brought Cypriots to their knees, saying it was the island’s offshore business model that had failed.

“To all those who say that we are strangling an entire people … Cyprus is a casino economy that was on the brink of bankruptcy,” he told Canal Plus television.

The euro gained against the dollar on the news in early Asian trading.

Analysts had said failure to clinch a deal could cause a financial market selloff, but some said the island’s small size
- it accounts for just 0.2 percent of the eurozone’s economic output – meant contagion would be limited.

The abandoned levy on bank deposits had unsettled investors since it represented an unprecedented step in Europe’s handling of a debt crisis that has spread from Greece, to Ireland, Portugal, Spain and Italy.

Miners trapped after earthquake hits Poland

Mar 202013

Eighteen miners are trapped underground in a Polish copper mine after an earthquake caused a cave-in, mine operator KGHM has said.

The miners are stuck 600 metres below ground at the Rudna mine, about 400km southwest of Warsaw, the Polish capital, and there has been no contact with them for two hours, KGHM spokesman Dariusz Wyborski said.

“The newest information is that 18 miners are trapped, four people have walked out earlier on their own,” KGHM said in a
statement on Wednesday, after earlier news reports mentioned 17 workers underground.

“There was a quake in the Rudna mine. The rescue operation is difficult because huge amounts of rocks have to be removed,” Wyborski said.

There had been no contact with the trapped miners because the tremor cut communication lines, the company said.

The mine, which has been in operation since 1974, is in the Silesia region, near Poland’s borders with Germany and the Czech Republic.

KGHM, the state-controlled  operator, is Europe’s second-biggest copper producer.

Poland has large numbers of mines, mostly in heavily industrialised Silesia. In 2006, a gas explosion at a coal mine in the region killed 23 miners.

Eurozone asks Cyprus to amend savings levy

Mar 192013

The eurozone has told Cyprus to drop part of a hugely controversial levy on consumer savings that would generate an expected 5.8bn euro ($7.51bn), according to a statement released after a meeting between Cypriot and EU officials.

The levy would be imposed at a rate as high as 12.5 percent on those with more than 100,000 euros ($130,000) in their bank accounts. Those with less than that amount would be hit by lower rates of deduction.

The one-time tax was announced as part of an agreement that would see Cyprus granted a 10bn euro ($12.95bn) sovereign bailout to avoid defaulting on its debts.

Monday’s statement came after Cyprus baulked at putting the EU bailout to a vote in parliament as the crippling terms sparked a public outcry and mounting talk of a rethink by eurozone creditors, even as the uncertainty forced a prolonged closure of the island’s banks.

Finance ministers “continue to be of the view that small depositors should be treated differently from large depositors and reaffirms the importance of fully guaranteeing deposits below [$130,000]“, Eurogroup President Jeroen Dijsselbloem of The Netherlands said in the statement.

The AFP news agency, citing a eurozone source, reported that this meant preferably removing altogether a 6.75 percent levy applied to all those with less than $130,000 in the bank.

Combined, those accounts amount to more than three-fifths of all Cypriot savings.

Parliamentary vote delayed

The economic and political fallout from the initial announcement on Saturday has been huge, with consumers rushing to banks and ATMs to try and withdraw their savings before the parliament ratified the measure.

The government said that the raid on savings was required alongside international loans in order to supplement the bailout, the fifth such bailout in the eurozone over the last three years.

Cyprus has shut its banks until Thursday at least and delayed a parliamentary vote on the package until Tuesday after large queues formed at ATMs.

Meanwhile, Russian President Vladimir Putin called the move ”dangerous”, and turmoil hit stock and currency trades amid concerns a precedent had been set for bigger debt-saddled eurozone economies like Italy and Spain.

The hastily-convened ministerial talks saw Dijsselbloem “reiterate that the stability levy on deposits is a one-off measure” which, he said, would “restore the viability of the Cypriot banking system” when applied in tandem with eurozone and International Monetary Fund loans.

The statement on Monday said that emergency re-negotiations would see Nicosia “introduce more progressivity in the one-off levy”, in other words increasing the tax rate on bigger holdings to ensure the same 5.8bn euro ($7.5bn) return.

Angry protests

Eurozone leaders rejected a Cypriot request for 17bn euros ($22bn) in rescue financing, insisting such a large debt would be unsustainable for the Mediterranean island of less than one million people.

They offered just 10bn euros ($12.95bn), insisting the balance be made up from within the island, principally through the levy on bank deposits.

Hundreds of protesters gathered outside the parliament building in Nicosia to register their anger at the unprecedented tax, not asked of other eurozone countries that have sought rescue.

Al Jazeera’s Peter Sharp, reporting from Nicosia, said protesters “feel that Cyprus is [being made] a scapegoat for the rest of Europe”.

“President [Nicos Anastasiades] spelled out what would happen without the bailout. It would mean bankruptcy for Cyprus, the collapse of the banking system and you could also see Cyprus going completely outside of the eurozone,” Sharp said.

Europe’s main stock markets lost ground on Monday and the euro fell under $1.30.

HSBC ‘to pay’ $1.9bn money-laundering fine

Dec 112012

Europe’s biggest bank, HSBC, will reportedly pay $1.9bn to settle a money-laundering probe by authorities in the United States.

The probe of the British bank has focused on the transfer of billions of dollars on behalf of nations like Iran, which are under international sanctions, and the transfer of money through the US financial system from Mexican drug cartels.

According to a law enforcement official, HSBC will pay $1.25bn in forfeiture and $655m in civil penalties. The $1.25bn figure is the largest forfeiture ever in a case involving a bank.

Under what is known as a deferred prosecution agreement, the financial institution will be accused of violating the Bank Secrecy Act and the Trading With the Enemy Act.

“It’s a huge slap on the wrist for HSBC, the biggest fine of its kind, and a warning to other banks that they can’t do the same,” Al Jazeera’s Alan Fisher, reporting from Washington, DC, said.

The London-based bank said it was co-operating with investigations but that those discussions are confidential.

The law enforcement official said an announcement of the agreement could come as early as Tuesday.

‘Violating Trading with the Enemy Act’

In July, the US Senate Permanent Subcommittee on Investigations released a report saying HSBC allowed clients to move shadowy funds from Mexico, Iran, the Cayman Islands, Saudi Arabia and Syria.

The same month, HSBC admitted to poor anti-laundering controls.

The reported settlement would resolve investigations by the US justice and treasury departments and other federal agencies, as well as the Manhattan district attorney.

As part of the HSBC settlement deal, it will admit to violating the Bank Secrecy Act and the Trading with the Enemy Act, the Wall Street Journal said, citing a government official.

In early November HSBC said it had increased the amount set aside for fines linked to money-laundering in the US to $1.5bn.

The report of the HSBC settlement came the same day the US Treasury announced that another British bank, Standard Chartered, would pay $327m to settle charges it violated US sanctions on Iran, Myanmar, Libya and Sudan.

For Standard Chartered, the fines from the Treasury and other US federal and local regulators brought to $667m the total it has been charged for sanctions violations.

Cargo ship sinks off the Netherlands

Dec 062012

Four people have been found dead after a cargo ship collided with another vessel on the North Sea and sunk about 65km off the coast of the Netherlands, the coast guard says.

Rescue teams were scrambling to find survivors after 13 crew members were brought to safety from life rafts after the collision on Wednesday night.

Coast guard spokesman Marcel Oldenburger said seven people remained missing.

“We can confirm that four bodies have been found, along with 13 people rescued alive,” he said.

He said a massive air and sea rescue operation involving several helicopters, two navy patrol ships and even one of the ships involved in the collision would continue through the night in an effort to find the remaining sailors.

The 148-metre Baltic Ace, with a crew of 24, was carrying cars and sailing under a Bahamas flag before colliding with the 134-metre container ship Corvus J.

The accident happened after dark and close to busy shipping lanes, said Peter Verburg, a coastguard spokesman.

He said the 12-man crew of the Corvus J was still on board the ship, which was helping in the rescue operation.

“It is badly damaged, but not in danger of sinking,” he said.

Verburg said the cause of the collision was not known.

“At the moment we are solely focused on getting the people to safety,” he said.

The Baltic Ace was en route from Zeebrugge, in Belgium, to Kotka in Finland, while the Corvus J was going from Grangemouth in Scotland to Antwerp, Belgium.

Rotterdam port is Europe’s biggest, and a disruption to shipping lanes in the vicinity could affect a wide range of
goods in and out of Europe.

Merkel expresses doubt over EU budget summit

Nov 232012

German Chancellor Angela Merkel has said that she doubts European leaders taking part in a summit this week on the EU’s 2014-2020 budget would reach an agreement.

Merkel’s statements  on Friday came as EU diplomats said that UK Prime Minister David Cameron’s “virulent” demands for austerity measures were blocking a deal on the budget.

A day after talks on the nearly one trillion euro spending framework saw a rocky start with serious disagreements among officials in Brussels, Merkel said that another summit on the budget of the 27-country bloc would most likely be required at a later date, probably early next year.

“I believe that the positions are partly still very far apart … I think that tomorrow we will advance a little, but doubt that we will achieve a result. I have already said that I think there will be a second stage,” Merkel told journalists after the conclusion of the first day of summit.

In a battle pitting several wealthy member states against those seeking a bigger aid budget,  Cameron is seeking to reduce the financial clout – and political sway – of the EU’s institutions.

As he arrived for a preliminary meeting with Herman Van Rompuy, president of the European Council of the 27 heads of state and government, Cameron said he was not happy with the latest budget proposals.

“These are very important negotiations,” Cameron said. “And clearly, at a time when we’re making difficult decisions at home over public spending, it would be quite wrong – it is quite wrong – for there to be proposals for this increased extra spending in the EU. So we’re going to be negotiating very hard for a good deal for Britain’s taxpayers and for Europe’s taxpayers, and to keep the British rebate.”

Huge pressure

Facing an ever more vocal Euroskeptic electorate at home, Cameron is under huge pressure to veto any seven-year deal at the summit opening on Thursday which would exceed the old 2007-2013 $1.28 trillion budget by as much as a euro.

Those opposing cuts to the budget say that European institutions need the means to implement their policies, which include creating jobs and economic growth, helping development in many southern and eastern nations, and closing the wealth gap between member states.

“Certain countries want to make drastic reductions in the budget. That’s a big mistake,” said Elio Di Rupo, Belgium’s prime minister.

The budget primarily funds programmes to spur growth in the bloc less developed regions and farming and amounts to about 1 per cent of the EU’s gross domestic product.

Deal unlikely

Manos Tzafalias, a Greek journalist, told Al Jazeera it was unlikely that a firm deal would emerge from the summit.

“It’s very rare that we have clear-cut deals within limited timeframes,” he said.

If the negotiations stall, he said, the union could potentially be stuck in a situation where it had little ability to plan for the mid- or longterm future.

“If by 2014, when the budget is supposed to kick in, they will just keep the old one and renew it every month,” he said.

The European Commission, the EU’s executive arm, backs more spending, arguing that cross-border initiatives will help to create the economic growth and jobs that the bloc of a half-billion people needs.

Cameron is set to do the talking for some of the other member states – such as the Netherlands, Sweden and, to a certain extent Germany – who also want limits on EU spending when he opens a session of bilateral talks with EU President Herman Van Rompuy.

He will demand a real cut in the EU budget, claiming that is the only justifiable outcome at a time when almost every member state has to cut its budget to lower debt.

“It would not be acceptable to see some huge increase in EU spending when other budgets are being cut,” Cameron said in the run-up to the summit.

Poland and Spain, on the other side, will head a group of nations imploring for more funds to be committed to help economic development in many southern and eastern nations and close the wealth gap in the EU and boost jobs and growth.

Going into the open-ended summit which might well stretch into Saturday, Van Rompuy made a first compromise proposal that leaned toward Cameron’s demands. It proposes a cut of between $4bn and $31bn, depending on how the figures are read.

“With less money, we cannot do the same as before,” Van Rompuy wrote in the invitation letter he sent to the 27 leaders.

Since each of the 27 member states has veto power over the budget, the outcome is a cliffhanger.

Leaders from Denmark up north to Spain and Italy down south are already threatening vetoes, sometimes for opposing reasons.

If the summit fails to find a compromise, the issue could spill over into a new meeting next month, or into next year.

There is no set deadline for a deal but the closer it gets to 2014, the tougher it will be for a smooth introduction of new programmes.

If there is no deal up to 2014, there would be a rollover of the 2013 budget plus a 2 percent increase accounting for inflation.

Greek protesters assault German diplomat

Nov 162012

Greek protesters enraged by civil service lay-offs have thrown water and coffee at Germany’s consul in the northern city of Thessaloniki amid chants of “Kick out the Nazis”, police say.

The protesters also tried to kick and punch Wolfgang Hoelsche-Obermaier, the consul, on the sidelines of a conference on Greek-German trade initiatives on Thursday.

“These people haven’t come here to help us, but to announce our death sentence,” Themis Balasopoulos, leader of Greece’s municipal workers union, who was at the demonstration, said.

“Stand united to kick out the Nazis”, some protesters chanted as loudspeakers erected by protest organisers blared a Nazi military marching song.

Many Greeks blame Germany for the tough austerity reforms that have plunged the economy into the worst recession witnessed in postwar Europe.

Hoelsche-Obermaier later said he had lost his glasses in the fracas. Other members of the German delegation were pelted with eggs by the group that numbered around 300 people, according to police.

No arrests made

Officers moved in to extricate Hoelsche-Obermaier from the crowd, but they made no arrests and nobody was injured in the incident, police said.

“Violence is not a legitimate means of debate,” German Chancellor Angela Merkel said in her reaction after talks with Jean-Marc Ayrault, French prime minister.

The incident came a day after Hans-Joachim Fuchtel, German deputy labour minister, said that three Greek municipal staff members were required to complete tasks accomplished by a single German.

“Studies show that 3,000 employees are required in Greece for local administration work carried out by 1,000 people in Germany,” Fuchtel said.

On Thursday, Hoelsche-Obermaier said there had been a “misunderstanding” over Fuchtel’s comments.

“It was a misunderstanding that was resolved. I feel more pro-Greek than ever,” Hoelsche-Obermaier later said.

Greece has been pressured by its international creditors, the EU and the IMF, to cut thousands of jobs from its civil service to earn bailout loans.

About 30,000 people protested in Athens last month when Merkel visited Greece.

Greek views on Germany, already tainted by the memory of a brutal occupation by Nazi forces during World War II, have been further strained by the eurozone crisis.

Europe-wide strikes

German officials have accused Greece of dragging its feet on reforms and wasting precious time bought by EU-IMF loans, to which Berlin is a major contributor.

Hundreds of thousands of Europe’s citizens went on strike or jammed the streets of several capitals on Wednesday, at times clashing with riot police, as they demanded that governments stop cutting benefits and create more jobs.

In Madrid and Barcelona, where the crisis is hitting particularly hard, protesters and police fought street battles resulting in dozens injured and numerous arrests.

The protests were met with tear gas in Italy and Spain, but were largely limited to the countries hardest hit by the austerity measures designed to bring government spending into line with revenues.

Wealthier nations like Germany, the Netherlands and Denmark saw only small, sedate demonstrations.

The zone of the 17 countries that use the euro currency has fallen into recession, according to official figures released on Thursday.

Unemployment across those countries has reached a record 11.6 per cent, with Spain and Greece seeing levels above 25 per cent.

HSBC raises money laundering provisions by $800m

Nov 052012

HSBC bank has put aside a further $800m (£500m) to cover potential money-laundering fines in the US as it announced a fall in quarterly profits.

The bank had already put aside $700m after a US Senate report published in July said lax controls had left it vulnerable to money laundering.

Pre-tax profit for the three months to the end of September was $3.5bn, down $3.7bn from a year earlier.

However, the bank said underlying profits in the quarter had increased.

They totalled $5bn, more than double the figure recorded for the same quarter a year ago.

Europe’s largest bank also put aside a further £223m to cover UK payment protection insurance (PPI) mis-selling claims. This brings the total the bank has set aside for PPI compensation to £1.3bn and the total for the UK banking industry as a whole to almost £13bn.