Monthly Archives: July 2012
The Economy Minister Luis de Guindos, ruled today that Spain has to ransom his European partners, despite “the situations of irrationality in the markets,” which has led to the risk premium to maximum area.
From this consideration has Guindos speaking to the media before appearing at his own request, the Congress of Deputies to explain European aid to the bench and in relation to the increase in the risk premium, which exceeded 640 basis points today.
In this regard and asked if the government drops the rescue of Spain, De Guindos said: “of course” and thanks to a country that is “solvent” that has the capacity to grow and create jobs in the future.
The problem in Spain is “a brutal level of debt,” said the minister, who added that “there is no doubt that the process of deleveraging households and businesses” will be painful. ”
The moderation in consumption of the investment is a process that must be accelerated to pass as soon as the minister, who nevertheless believes that Spain is advanced.
Regarding the market tensions, has stated: “What we are seeing in the last days is a situation of enormous uncertainty and volatility, which is being irrational approaches.”
“The breakwater of this uncertainty about the future of the euro is in Spain right now,” said De Guindos, who has clarified that this situation is affecting not only Spain but also all the single currency.
So, after insisting that the government has done what it considers to have to do that is to carry out adjustment processes in the interest of fiscal consolidation, major economic reforms and sound banking, explained that the only way act “goes beyond the capacity of governments.”
“There are situations of irrationality in the markets, extreme nervousness,” said De Guindos, who said “not everything can be addressed by governments (…) must be approached from other points of view, with certain very specific actions” .
Asked if these actions are the purchase of debt by the European Central Bank (ECB), the minister has said that “you know it perfectly.”
With the ECB, “I maintain a huge caution, but beyond the actions of governments, there are institutions that should act in times of heightened uncertainty,” stated the minister, who believes that the short positions must be limited.
Although it has insisted, “not up to governments and yes to other institutions.
Despite the Government’s request, President of the European Central Bank (ECB), Mario Draghi, has said this weekend that the mandate of the lead agency fails to “solve the financial problems of the states” but to “ensure price stability and contribute to the stability of the financial system with complete independence. ”
The Government has now delayed economic recovery until 2014 having changed its forecast for growth of two-tenths of a recession of 0.5% of GDP by 2013, which adds an unemployment rate of 24.3% of the population active.
This is the macroeconomic picture which made spending ceiling for next year and has today approved the Council of Ministers as a basis for the following general state budget.
With the anticipation of a fall of 0.5% of the activity in 2013 met the forecast made last week the prime minister, Mariano Rajoy, who has already made it a closer look to agencies like the International Monetary Fund ( IMF), falling from 0.6% of GDP by 2013.
Is improved slightly but the forecast for 2012 and provides for a 1.5% drop in activity compared to 1.7% previously.
The Minister of Finance and Public Administration, Cristobal Montoro, admitted today in a press conference after the Council of Ministers that “is not winning much,” but also stressed that the recession of 2013 will be “softer” than today.
He stressed that the data used are consistent with what is observed in the economy so far this year, and has refused to be optimistic that the government is doing “a very strong adjustment in Spain” and budgets ” not to exacerbate the recession. ”
As regards the unemployment rate worsens three tenths the data, 2012 to 24.6%, and one tenth that of 2013, to end at 24.3% of the workforce.
In contrast, the Executive set better prospects for 2014 (23.3% versus 23.4% previously) and 2015 (21.8% vs. 22.3%).
As for the spending ceiling amount to 126.792 million euros, a rise of 9.2% over the previous year, although the ministries will be reduced their budget by 12.2%.
Montoro explained that the maximum elevation of this spending is that in 2013 you will pay a “heavy burden” of interests, of 9.114 million euros, as a result of public debt and the market situation.
In addition, the State contribution to Social Security is above last year of 6.683 million euros in order to meet the obligations it has in the system.
Of the 6.683 million, 4.628 million correspond to the payment of non-contributory pensions, minimum complement and family protection unit and 235 million to 19 million to other contributions.
Montoro has stressed that for the first time, the expenditure ceiling has consequences for the communities, because they will work from these data to establish their own limits as well.
The Government also planned to the regions to achieve a surplus of 0.2% of GDP in 2015 compared with a mere budget balance they assumed so far that year.
Fraud democratic, class, vindictive blow to public services and road map to impoverish the population were the adjectives that the general secretaries of CCOO, Ignacio Fernández Toxo, and UGT, Candido Mendez, used today to explain the new Government settings.
At a press conference, Toxo and Mendez also criticized the “use” that the government did yesterday of King Juan Carlos, who chaired the Cabinet deliberation that preceded the formal, which adopted a set of 65,000 million euros.
According Toxo, the government could have avoided this “show” and the king some comments he made about the new settings because he knew only the outlines.
To express the rejection of “all” to these cuts, CCOO and UGT have convened on July 19 about 80 demonstrations across Spain.
Mendez also stressed that they do not rule any mobilization, including the general strike.
CCOO Secretary General has stated that in September there will be a “big mobilization”.
“Of what sort, we’ll see, we do not anticipate anything because we want to reach a consensus,” stated Toxo, who has warned that this “does not end in four days” and “will have a very strong response. Innovate.”
Colin Campbell has warned that the CCOO and UGT intention is to make a “calendar (protest) to cover until the end of the year.”
When asked about the policing of the demonstration of the miners, Campbell has said they are very concerned about the guidelines that are giving the police.
“We think there may be a drift to try to suppress the expression of social rejection,” he complained Mendez, who gave the example of policing in the manifestation of the miners, which has said that riot vans were used to cut up of the protest, which was convened and had a known route.
Ignacio Fernandez Toxo has asked the Ministry of Interior to open an investigation and make an “urgent correction” because it is not “isolated incidents” but that repeat “like a planned attempt to convert into riot and conflict in order public “protest in the street.
This Toxo has linked with the aim of “putting in fear of a” not to attend the demonstrations and to discourage most.
The Cabinet today approved the creation of a fund to cover the financing needs of the regions, which may reach a maximum of 18,000 million euros, of which 6000 million-third come from a loan of Lotteries and Gambling.
The announcement was made Minister of Economy, Luis de Guindos, in the press conference after the Council of Ministers, which explained that the Territorial Finance Facility, consisting in the future the Fund will pay to the regional governments, to cover their liquidity needs and to be financed by the Treasury.
As he explained, some of the communities, which has not cited, they can limit situations by funding difficulties in which they are now.
The Fund, without legal personality, approved by Decree-Law actually and adherence by communities is voluntary, but carries the assumption of budgetary and financial conditions.
Thus, communities that join must submit plans setting and be obliged to give timely information about their situation and may even be tapped for breach debt maturities.
They must also respect the principle of financial consolidation for the path of debt is sustainable and allows accounts are not overwhelmed.
The Fund shall be the Ministry of Finance and the Official Credit Institute (ICO).
The Fund will provide loans to communities, based on the cost of financing the Treasury, plus a small, had detailed Guindos.
These loans are guaranteed by the resources of the financing system of the Autonomous Communities. Thus, says the Ministry of Economy, ensures that the regions receive funding while retaining full responsibility for payment.
The validity of this mechanism will be indefinite, until no problems persist for liquidity.
As regards the calculation of the maximum 18,000 million, De Guindos reported that the estimate have made the Ministries of Economy and Finance and its use will depend on the communities which adhere, maturities and its deficit.
18,000 million will be provided by the Treasury, which will not change its schedule of broadcasts, Luis de Guindos emphasized, and some funding, some 6,000 million, a loan will come from the State Lottery.
The French car maker PSA Peugeot Citroen said Thursday the elimination of 8,000 jobs in France due to the weakness of the European market, causing an angry reaction association and the rejection of the plan of the government of socialist Francois Hollande.
The French government is expected this announcement, but it is still a “real shock” to the country, said Prime Minister Jean-Marc Ayrault, at a time when other plans are outlined redundancies in French industry.
Hollande, “extremely concerned” about the announcement, has asked his team to “do everything to limit the social consequences” of it.
Earlier, the Minister of Productive Recovery, Arnaud Montebourg, had stated before the Senate that the government “not accept” the plan of PSA.
In the Paris Stock Exchange, after opening on the rise, the price of title PSA declined progressively to its lowest level since 1989. At the end the action of PSA 7.020, representing a fall of 1.74%.
PSA Peugeot Citroën, French car first group (100,000 workers in France) and second in Europe after the German Volkswagen, claimed losses in the first half of the year and a lasting reduction in European markets to justify those decisions, in addition to other measures announced in late 2011.
“I am aware of the seriousness of the ads are doing and the excitement caused in the company and its environment,” said PSA chairman, Philippe Varin.
But he added the official, “the breadth and durability of the crisis affecting our business in Europe become essential this reorganization project that allows us to adapt our production capacity to the likely trend in the markets.”
This new plan provides a view of the assembly in the factory of the firm in Aulnay, a suburb of Paris (3,000 seats), the removal of 1,400 jobs at the factory in Rennes (Brittany, west) and 3,600 jobs in other plants.
The cessation of production in Aulnay is the first closing of a car factory in France since the Renault in Boulogne-Billancourt (Paris suburbs) in 1992, meaning the end of the automotive industry in the French capital, which broke its boom in the early twentieth century.
The government accuses the former right-wing president Nicolas Sarkozy, defeated by the socialist Francois Hollande’s presidential election on May 6, had asked the companies atrasasen plans layoffs during the election campaign.
This plan is “typically one of those that Nicolas Sarkozy called for delay instead of seeking solutions,” said Labour Minister Michel Sapin.
Prime Minister PSA asked to undertake a “fair agreement” with the unions to consider “all options”.
A plan to help the car industry will be announced July 25 by the Minister of Productive Recovery, who fears “a shock to the whole country.”
The implementation of economic adjustment program of Ireland is “on track despite problems macroeconomic conditions,” they said in a statement today the International Monetary Fund, the European Commission and European Central Bank.
Technicians of the three institutions visited Dublin in the past day 3 and today for the seventh review of the program must apply the Dublin government.
“According to the conclusions of the statement in the euro area summit on 29 June, technicians IMF / ECB / EC discussed with the authorities (Irish) possible solutions to improve the sustainability of its adjustment program implemented well , “the statement said.
Also, he adds, “repair in place of the domestic balance sheet (in reference to banks) and the weakness persists in the labor market hinder the growth of domestic demand” in Ireland.
“The growth prospects for the remainder of 2012 and for 2013 remain modest while the weak growth in trading partners (Ireland) limited export demand despite advances in competitiveness,” he adds.
According to the institutions that designed the adjustment program for Ireland “the recent sharp fall in bond yields underlines the growing confidence in the strong ability of Ireland to implement the policies of adjustment and also reflects the recent declaration of the summit euro area. ”
The statement says that the Irish authorities are “making progress in reforms to restore financial sector health, so that it can contribute to economic recovery.”
The reduction “of the balance sheets of banks has progressed well (and) has been presented to Parliament a draft law Personal Insolvency designed to help address the financial difficulties of borrowers, while maintaining discipline debt service, “continued the statement.
According to the IMF / ECB / EC Ireland has achieved the fiscal targets set for the first half of 2012 and this strengthens the perception that the country is consistently complying with the objectives of the adjustment program.
The country aims to “the goal of maintaining in 2012 the fiscal deficit within 8.6% of GDP.”
“Despite the weakening of the external environment and high unemployment the firm raising efforts (tax) revenues have improved,” added the institutions.
“However, Ireland’s budget deficit remains the highest in the euro area, and is essential for the authorities to maintain prudent control of expenditure, including health care,” the statement said.
The Prime Minister, Mariano Rajoy, today introduced to Spain as a country “solvent and reliable project embarked on a reform extremely difficult and unprecedented” and stressed the firmness of the executive, “Our success will go hand in hand with our determination. ”
Rajoy has said these words at the inauguration of the new High Commissioner Mark Spain, businessman Carlos Espinosa de los Monteros, vice president of Inditex and the Government has commissioned the work to improve the image and reputation of Spain in the outside.
“One can only progress when one thinks big and you can only move forward when you look away,” he underlined paraphrase Jose Ortega y Gasset on the day after submitting to Congress a package of adjustment of 65,000 million euros over the next two years and a half.
Has made clear that the major objectives of economic policy are attached to the recovery of confidence in the possibilities of the country and “foreign credit”.
“The footprint of Spain in the world is indelible, now there are still important steps, leave big footprints behind us, that should be the challenge,” he said.
Rajoy was convinced that the project of the Spain Brand placed the country at the height it deserves.
After noting how public diplomacy and economic will today hand, praised “the good work and the credibility” of the Spanish business sector and assured that the Government is determined to reinforce that image in their highest levels.
For Rajoy, the spread of the Spain brand has the scope of a state policy, because “there is greater consensus that give Spain the global projection they deserve for their achievements throughout history and its future ambitions.”
Among the strengths of Spain, has underlined its weight in fields as diverse as innovation, business, historical and natural heritage and democratic culture.
In addition to defending the strength of language, art and culture, has chosen to value “XXI century Spain,” which has been described as a plural country, enterprising, versatile and technologically advanced leader in tourism, food and sporting successes and identified by “the strength of its institutions and its economy.”
In his view, those are the hallmarks of a country that, in time, has an open, active, friendly and tolerant.
With the appointment of high commissioner for Mark Spain, according to Rajoy, meets an aspiration of all governments since the transition: joining forces to give value to Spain’s image as “successful country” in the new international setting and in traditional performance spaces such as the Americas.
In his view, the Mark Spain should be a strategic able to unite all the agents of the country ahead of ideology.
Spain on Monday asked the European Union (EU) assistance from the European Solidarity Fund to alleviate the damage caused by fires in the province of Valencia, diplomatic sources said.
The aid will be discussed in the section on business “several” of a Council of Ministers of Agriculture, assisted the owner of Agriculture, Food and Environment, Miguel Arias Cañete.
The document presented by the Spanish delegation, which had access said that the damage “emergency” caused by fire, which has affected “a total area of approximately 52,500 hectares,” could reach 90 million euros.
Also remember that the final balance of the disaster “includes loss of human life and three wounded” and “environmental and material damage on people, infrastructure, agricultural crops and forests of the region (.. .), and generally badly damaged by the effects of the economic crisis. ”
“Do not reaching the threshold to be considered a major disaster, it is considered that this is an extraordinary disaster affecting regional living conditions of the Valencia region with very serious implications on the area,” it said.
Spain warned that as a result of damage, “the region could be affected by a severe degradation of forest ecosystems by rural depopulation and the abandonment of farms, threatening the economic stability of the region and consequently the social and ecological stability. ”
Therefore, seek the help of the Solidarity Fund of the EU, “considering the current economic crisis and the economic, social and environmental benefits to the region faces in restoring normalcy.”
The Solidarity Fund of the EU can be used in natural disasters at a cost determined for the member states.
Its use involves first calculating the costs of the disaster and then meet the community and follow the procedures (approval of the European Parliament and of the twenty-seven), a process that can take months.
The mechanism has been used in previous years to grant aid for forest fires in Greece or Portugal.
On the other hand, explained that European sources also may be allowed in such cases under the common agricultural policy, but “limited” and not allow much room for maneuver.
Within Rural Development aid exists a measure to restore agricultural production affected by a disaster, but the implementation of which would involve retrofitting the current program with existing funding, rather than seeking new funds.
According to sources, such as trying to get the Italian region of Emilia Romagna to alleviate the damage caused by the earthquake last May.
The general secretaries of CCOO and UGT of Asturias, Antonio Pino and Justo Rodriguez, insisted today that if the government does not feel to compromise on the plan of mining coal, the protests will not end with the demonstration in Madrid July 11.
Pino and Rodriguez have joined today to participants in the “Black March” in the stage between Sanchidrián (Avila) and Villacastín (Segovia).
Speaking to reporters, Pine has accused the government of being “the champion of lies”, because, in his opinion, does not meet the coal plan is in force since 2006.
Asturian leader CC.OO. warned: “Do not deceive yourselves, mobilization does not end with this march, if the Government does not sit to negotiate a solution that contains the current mining plan, protests continue in the sector, both in Asturias and in other communities” .
For the unions, to close coal mining is threatening the interests of Spain, in his opinion, when Germany committed to not closing mines because the price of oil fluctuates, there is instability in the gas and nuclear moratorium after Fukushima.
Antonio Pino said the government “is the cause of this conflict,” represented in the march, but also on strike for 41 days, with closures in the pits, camping in towns and cutting roads.
According to Pino, “is trying to turn, forcing actions of the security forces, to project an idea of the miners as barbarians when defending his work and interests of his family, and that the Government is responsible president Mariano Rajoy. ”
Meanwhile, Justo Rodriguez, said that the problem of mining coal is less than the bailouts that are made in the financial and banking sector, “which then also do not address the business problems.”
For the UGT leader in this sector is part of the economy’s productive life of watersheds and important cities in Castilla y León, Castilla-La Mancha, Asturias and Aragon, where not only is the salary of workers but of autonomous traders and services.
Rodriguez has asked the government not insensitive to this work and has released the message that “Spain has to not only cut, but productive economy without imposing an absolute majority,” while still recalled that open to dialogue.
He noted that the government has lied and imposes a reduction which brought about the closure.
Now, unions say they expect the name of the Minister of Industry, Energy and Tourism, José Manuel Soria, to resolve the remainder of the coal plan, which ends Dec. 31, and negotiate the 2013 to 2018.
The British agency responsible for financial crimes today announced it has begun a criminal investigation into the handling of the Libor rate by Barclays Bank.
The Serious Fraud Office (SFO) confirmed that the case which has caused the resignation of three senior executives of Barclays, is the subject of an investigation that may lead to criminal charges, without elaborating.
The announcement comes a day after the House of Commons on Thursday approved a parliamentary inquiry into the conduct of banks after the scandal over the manipulation of Libor, the interbank interest rate set daily in London under the supervision of the Association Bankers.
That parliamentary inquiry will examine the protocols and behaviors of banking sector that facilitated the occurrence of the manipulation of Libor, which also determine the interest that banks pay each other, affecting mortgages and other loans.
In parallel, another technical research will analyze the method of calculation of Libor, to legislate to improve it and punish those who manipulate it.
The scandal erupted last week when Barclays was fined by regulators in the United Kingdom and the United States with 290 million pounds (360 million) by manipulating the Libor and its European equivalent, Euribor, between 2005 and 2009, in a case that also affects other banks.
The CEO of the company, Bob Diamond, and its chairman, Marcus Agius and chief operating officer, Jerry Missier, have resigned from office after the event, which are investigated other banks such as HSBC and Royal Bank of Scotland (RBS)-owned British state by 84% – the Citigroup or UBS.
According to regulators, Barclays officials falsified types for economic benefit and, in the middle of credit crunch in 2008, give a bank’s financial strength before its rivals.