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Athens News Agency: Daily News Bulletin in English, 15-07-01

Athens News Agency: Daily News Bulletin in English Directory - Previous Article

From: The Athens News Agency at <http://www.ana.gr/>

Wednesday, 1 July 2015 Issue No: 4989

CONTENTS

  • [01] Greece makes last-minute pitch for two-year agreement with ESM, debt restructuring
  • [02] Greece's 2-year proposal for deal with ESM includes conditionalities-finmin official
  • [03] Dijsselbloem announces extraordinary Eurogroup teleconference tonight on Greek request
  • [04] Eurogroup teleconference ends, new one on Wednesday
  • [05] Government publishes proposal submitted by the institutions to Greece
  • [06] EFSF announces expiration of Greek aid programme at midnight
  • [07] Government heading towards Sunday's referendum and looking for solutions, gov't sources say
  • [08] PM Tsipras has phone contact with Cyprus' President Anastasiades
  • [09] PM Tsipras continues contacts with EU officials
  • [10] PM Tsipras has phone conversation with Italy's Renzi
  • [11] President stresses need for agreement that allows Greece to stay in the euro
  • [12] Tsakalotos: 'We look forward to greater flexibility in the days to come'
  • [13] State Minister Flambouraris on what the partners' proposal should include
  • [14] State Minister Pappas: The referendum will be held as scheduled
  • [15] Interior Minister Voutsis urges all Greeks to participate in referendum
  • [16] Defence Minister Kammenos: I do not accept any ultimatum
  • [17] Finance Ministry official: We want a proposal that will make the debt sustainable
  • [18] Merkel: 'Door remains open' for talks with Greece
  • [19] German Chancellor had improved on Eurogroup offer to Greece last Friday, Der Spiegel reports
  • [20] The door is still open to reach an agreement, but time is running out, EU Commission spokesman says
  • [21] Cyprus president talks to German Chancellor on Greece
  • [22] German FinMin Schaeuble says it's up to Greece to avoid bankruptcy and Grexit
  • [23] 'I am infuriated because they do not treat Greece with honesty,' Social Democrats' member Schwan says
  • [24] ND leader Samaras: Referendum is about 'Yes' or 'No' to euro and Europe
  • [25] SYRIZA calls on Samaras to adopt position on specific austerity measures
  • [26] ND spokesman attacks government over pension payment restrictions
  • [27] Communist Party says referendum traps Greeks in a 'fake dilemma'
  • [28] Kremlin: We are watching closely the developments in Greece
  • [29] 'A knowledge of simple maths required'. Op-ed by Greek journalist Giorgos Harvalias
  • [30] Government creates website with information on upcoming referendum
  • [31] Parliament suspends all planned sessions from Wednesday until Friday
  • [32] There is no problem right now with medicine supply, Pharmaceutical Association says
  • [33] Solution found for Evros border policing after EU funding programmes expired on Tuesday
  • [34] Fitch downgrades Greek banks to 'RD' on capital controls
  • [35] S&P lowers credit ratings on four Greek banks to SD
  • [36] Greek PPI down 4.6 pct in May
  • [37] FinMin Varoufakis rejects rumours of lowering cap on cash withdrawals
  • [38] Retail sales volume index down 1.9 pct in April
  • [39] Light quake jolts Pylos
  • [40] Clouds, rain on Wednesday
  • [41] The Tuesday edition of Athens' dailies at a glance Politics

  • [01] Greece makes last-minute pitch for two-year agreement with ESM, debt restructuring

    The Greek government on Tuesday presented a last-minute proposal for a two-year agreement with the European Stability Mechanism (ESM) to fully cover its financing needs, combined with debt restructuring.

    "From the first we made clear that the decision to call a referendum was not the end but the continuation of a negotiation seeking better terms for the Greek people," an announcement from the office of Prime Minister Alexis Tsipras said.

    "Greece remains at the negotiating table," the announcement added, stressing that the Greek government will strive for a viable agreement within the euro up to the very end.

    For this reason, the announcement added, the message is to vote 'No' to a bad agreement in Sunday's referendum.

    [02] Greece's 2-year proposal for deal with ESM includes conditionalities-finmin official

    The two-year proposal for a deal with the European Stability Mechanism (ESM) submitted by the Greek government earlier on Tuesday is accompanied by conditionalities, a senior finance ministry official said, without getting into details.

    [03] Dijsselbloem announces extraordinary Eurogroup teleconference tonight on Greek request

    BRUSSELS (ANA-MPA/M. Aroni)

    Eurogroup chief Jeroen Dijsselbloem announced an extraordinary teleconference of eurozone's finance ministers at 19.00 Brussels time (20.00 Athens time) on Twitter on Tuesday to discuss the Greek government's official request received this afternoon.

    [04] Eurogroup teleconference ends, new one on Wednesday

    The Eurogroup teleconference ended on Tuesday evening. According to a government source, the teleconference will be continued on Wednesday so that finance ministers can evaluate the proposals submitted by the Greek government.

    [05] Government publishes proposal submitted by the institutions to Greece

    The Greek government published on Monday evening the full proposal submitted by the institutions to Greece, so that people can be fully informed on the content of the proposals for reforms and laws which the government will have to implement and on which Greeks will asked to decide upon in next Sunday's referendum.

    According to the document accompanying the proposals, the General Secretariat of Information and Communication said the following:

    "In the early morning hours of June 27, Prime Minister Alexis Tsipras announced a referendum that would allow Greeks people to decide on whether or not to sign the measures proposed by the institutions.

    On Sunday, the Greek people will be called upon to approve or not the reforms and laws the Greek government will have to implement. To do this, people will have to be fully informed on the content of these proposals.

    There must not be one Greek standing in front of the ballot box who hasn't read carefully the document with the proposals of the institutions. For this reason, we publish the full proposal submitted by the institutions to the Greek government."

    [06] EFSF announces expiration of Greek aid programme at midnight

    BRUSSELS (ANA-MPA/Ch.Vasilaki)

    The European Financial Stability Facility (EFSF) announced on Tuesday evening the expiration of its aid programme to Greece at midnight, adding that, as a result, a remaining 1.8-billion-euro loan installment and 10.9 billion for a possible bank recapitalisation will be lost.

    The full announcement of the Fund is the following:

    "The Greek financial assistance programme of the European Financial Stability Facility (EFSF) expires tonight at midnight CET. As a result, the last EFSF loan tranche of ? 1.8 billion will no longer be available for Greece and the ? 10.9 billion in EFSF notes to cover the potential cost of bank recapitalisation or bank resolution in Greece will be cancelled.

    Klaus Regling, CEO of the EFSF, said: "It is regrettable for Greece that the EFSF programme will expire today without any follow-up arrangement and that the positive results of the programme are put at risk. Due to the economic policies adopted under the EFSF programme, the country was on a good path towards strong growth until the second half of 2014. The many sacrifices which the Greek people had to make were paying off. Greece managed to cut its budget deficit and regain competitiveness. The country was able to access financial markets again and saw its high unemployment start declining. According to the OECD and World Bank, Greece was a reform champion until 2014, with encouraging growth prospects. This trend can continue if the Greek population decides to return to the path of reform within the euro area."

    The EFSF programme started on 21 February 2012. It was originally due to end on 31 December 2014, but was extended twice upon request of the Greek government. In the context of the programme, the EFSF disbursed ? 141.8 billion to Greece. It included ? 48.2 billion to cover the costs of bank resolution and recapitalisation. Of this amount, ? 10.9 billion in EFSF notes was not needed and was later returned to the EFSF. Accordingly, the outstanding loan amount stands at ? 130.9 billion. This makes the EFSF Greece' s largest creditor by far.

    Greece' s financial assistance programme was unique in many aspects. Due to the seriousness of the country' s structural weaknesses and adjustment needs, it was the biggest EFSF or ESM programme ever. It also had by far the most favourable lending conditions ever granted to an EFSF or ESM programme country. It included Private Sector Involvement with sizeable losses for private investors. Greece benefits from an average loan maturity of over 30 years. The country pays neither interest rates nor redemption on the overwhelming part of its EFSF loans until 2023. These favourable lending conditions provided Greece with budgetary savings of over ? 16 billion for 2013 and 2014 combined. That corresponds to more than 4% of Greek GDP in each of the two years."

    [07] Government heading towards Sunday's referendum and looking for solutions, gov't sources say

    The government is heading towards Sunday's referendum while also looking for a solution, government sources said early on Tuesday morning.

    According to the sources, Greece received a message from European Commission President Jean-Claude Juncker in which he called for acceptance of the creditors' agreement as presented two days ago and requested that Prime Minister Alexis Tsipras calls on the Greek people to vote for it ("Yes"). Greece's creditors - the European Commission, the European Central Bank and the International Monetary Fund - would consider a change in their text, the message said, and the Greek government could request an emergency Eurogroup.

    "The Greek government is heading towards the ballot, is listening to everything that is said and written with interest, and is working towards a solution," the government sources said, adding that Tsipras would vote against the proposal ("No") on Sunday.

    [08] PM Tsipras has phone contact with Cyprus' President Anastasiades

    Cyprus President Nicos Anastasiades late on Monday had a phone contact with Prime Minister Alexis Tsipras, with whom he exchanged views on the latest developments regarding the Greek issue.

    Government spokesman Nikos Christodoulides hinted that the contact was made ahead of the phone contact of the Cypriot president with EU officials and leaders on the Greek issue.

    The spokesman said that the aim of the President is to achieve in practice what everyone wants, namely an agreement even at this late stage that will ensure the stay of Greece in the eurozone.

    [09] PM Tsipras continues contacts with EU officials

    Prime Minister Alexis Tsipras continues his contacts with European officials. Tsipras has already spoken on the phone with European Commission president Jean-Claude Juncker, ECB president Mario Draghi and European Parliament president Martin Schulz.

    [10] PM Tsipras has phone conversation with Italy's Renzi

    ROME (ANA-MPA/T. Andreadis-Syngelakis)

    Prime Minister Alexis Tsipras spoke on the phone with Italian PM Matteo Renzi on Tuesday, Italian government sources said, according to the country's news agency ANSA.

    [11] President stresses need for agreement that allows Greece to stay in the euro

    President of the Hellenic Republic Prokopis Pavlopoulos on Tuesday said it was crucial that an agreement be reached that provides a solution allowing Greece to remain in Europe and the Eurozone but also show that there is solidarity between all European peoples, while receiving the mayors of Greece's two largest cities, Athens and Thessaloniki.

    Pavlopoulos stressed that Greece's position was "non-negotiably" within Europe and the eurozone, and stressed that he is working in this direction "without taking into account either human effort or, much more so, individual provisions, since I am aware of the spirit of the Constitution regarding the duties of the president of the republic in this direction," he said.

    Athens Mayor George Boutaris and Thessaloniki Mayor Yiannis Boutaris visited the president to express their grave concern over what they called a "polarising climate" that had arisen after the government announced a referendum on July 5 "and because we do not want to see the country's presence in the eurozone and by extension in the European Union jeopardised."

    Boutaris said that the government must be "pressured and supported in order to come to an agreement," and warned that if an agreement was not reached "no one knows, or rather can imagine, what will happen."

    [12] Tsakalotos: 'We look forward to greater flexibility in the days to come'

    In a statement to the ANA-MPA and other media on Tuesday, Greece's Alternate Minister for International Economic Relations Euclid Tsakalotos presented his own version of what caused the breakdown in the talks between Greece and the lenders. According to the head coordinator of the Greek negotiating team, at least part of the problem was a lack of agreement between the three institutions involved, which he said "did not always see eye to eye".

    The full statement is given below:

    Any breakdown in negotiations is unlikely ever to have one cause. This is especially true when, as in the case of the Greek government, we were negotiating with three institutions which did not always see eye to eye on the desired details of any agreement, let alone over the wider strategic issues such as the question of whether the Greek debt is sustainable and needs to be re-profiled. All sides have claimed that they showed the maximum amount of flexibility in order to ensure an agreement. Unfortunately this is a claim that is not easily supportable with respect to the negotiating stance of the institutions.

    1) Fiscal Targets and Fiscal Measures

    The Greek government agreed to quite recessionary targets for fiscal surpluses for the coming years, especially when one considers the income loss (25%) over the last five years and the huge unemployment rate we face. In this context one would have expected the institutions to be quite "flexible" - their favourite word - over how we reach those targets. Not at all:

    ?They insisted that for 2016, the fiscal package must include 1% of GDP from the VAT. We were told that increasing the VAT rate on restaurants/catering to 23% would constitute a "deal maker" - another favourite word. But on the last day of the negotiations, the institutions changed their stance. Even though the two sides at the technical level had previously agreed what such an increase could be expected to raise in tax revenue, they now said that the sums could only add up if both catering/restaurants and hotels were increased to the highest VAT rate. Given the effect of such changes on Greek tourism, it was a little strange to hear the institutions claiming that it was the Greek government that was proposing measures that would harm the competitiveness of the Greek economy.

    They insisted, also that for 2016, the fiscal package must include 1% GDP from the pension side. The Greek side had proposed a serious reform proposal on pensions, including cutting early retirement arrangements and raising the effective retirement age. We also proposed to set up a serious actuarial study which could have led to proposals for new reforms to be introduced once the economy turned around, and unemployment began to fall. But when you insist on 1% GDP from pensions for 2016, you are insisting on pension cuts not pension reform.

    They insisted that no administrative measures could be included in the fiscal package to close the fiscal gap. Now it is certainly the case that administrative measures, such as fighting corruption and tax evasion, take time to bear fruit. But it is another matter not to allow any revenues whatsoever from such measures to be included in the proposed fiscal package. And this is even more extraordinary in the case of this government that ran the election on an anti-corruption and anti-tax evasion programme.

    They were reluctant to accept measures that would have been paid by the elites and the richer sections of society, claiming that this was anti-developmental. Thus they did not accept the lump-sum levy on the profits of firms with over 500,ooo profits, while at the same time they proposed that all businesses, small or large, prepay 100% of their taxes for the following year. For reasons best known to the institutions, the latter was presumably deemed developmental.

    They insisted that wage decompression in the public sector, not in itself necessarily a bad move, should be carried out in both directions. That is to say that the wages of the poorest public sector workers should be continued to be cut.

    2) Structural Reforms

    The institutions never accepted that in the spirit of the February 20 Eurogroup decision, the Greek government could propose, at least some, reforms based on a different logic. For they insisted that the privatization list be extended, and that workers should face real wage cuts as they would be required to increase their social and health contributions. Moreover:

    They never accepted that the Greek government could, in cooperation with the ILO, quickly introduce a system of collective bargaining, something that already exists in most of our partner economies. For us such a system can contribute to a new productive model in which firms succeed through innovation and searching for new markets, rather on the basis of poor wages and poor labour relations. Delaying this reform merely allows firms to continue sacking workers on, say, 700 euro a month, and replacing them with others on 500 a month. Hardly an approach to ensure a vibrant new economy.

    They never accepted that the Greek government, this time in cooperation with the OECD, could set out a new reform agenda for product markets, different from that of the previous governments. On the contrary they insisted that liberalizing pharmacies and bakers was somehow crucial to addressing the competitive deficit of the Greek economy. We, on the other hand, argued that we should go for the big fish first; that is to say start with important cartels in certain industries, public procurements, and anti-corruption measures. We further argued that the correct sequencing of supply side reforms was crucial to their success, and that the OECD agreed with us that, in the past, a failure of sequencing was in part responsible for the failings of the structural adjustment policies in Greece.

    3) Financing

    The financing of any extension of the programme was planned to continue on the old model: reform-disbursement-payment, with multiple reviews one after another. These financing arrangements would have relied on IMF disbursements, which could not be taken for granted. Moreover they would have not addressed the issue of arrears, delayed payments to our own citizens, and would have provided precious few buffers for unforeseen events. The above would hardly have provided the fiscal space for the government to have been able to concentrate its attention on its ambitious reform agenda.

    Moreover with respect to problem of the debt, we were offered a slightly improved version of the November 2012 promise of the Eurogroup to reconsider the issue of debt after the summer. The modest proposal to shift bumpy ECB debt into less bumpy, and longer term, ESM debt, without providing any more money for the Greek government itself, was never seriously considered.

    Conclusion

    It is difficult to believe that the proposal of the institutions would have put aside, once and for all, the question of Grexit. It would have merely pushed it back till the moment that a new programme, and the debt, were negotiated. In this context it is difficult to believe that the pent up demand in Greece would have been released: that consumers would have increased their consumption; that citizens would have returned their money, from abroad or from under the mattress, back to the Greek banks; that investors would have invested. It is difficult to believe, in other words, that the economy would have turned around, that we would have been able to keep our promises on fiscal surpluses.

    So what does the Greek government think of the proposed flexibility of the Institutions? It would be a great idea. We see the referendum as part of the negotiation process, not in lieu of it. So we look forward to greater flexibility in the days to come.

    [13] State Minister Flambouraris on what the partners' proposal should include

    The Minister of State responsible for coordinating government work Alekos Flambouraris made the following statement on Tuesday:

    Will the "partners eventually" stop the propaganda by repeating the same proposal and presenting it as a new one? "If they want to contribute to a solution, there is only one proposal, which must contain:

    No reduction in salaries and pensions

    Reinstitution of collective negotiations and the minimum wage

    Additional development package, in addition to the new NSRF

    Restructuring with debt haircut

    Only this way can the Greek people breathe, the economy restart, the productive reconstruction begin. Only so our dignity will be restored."

    [14] State Minister Pappas: The referendum will be held as scheduled

    "The referendum will be held as scheduled, a strong no, return to the negotiations and a good agreement for Europe, for Greece and for our people in the next week," said State Minister Nikos Pappas in his address to parliament on Tuesday.

    "A large number of political and other centers are trying to create impressions with the view to promoting their own perspective. We have heard many things in the last days. We have heard that the referendum is a coup d' etat. Our people are calm and have nothing to fear," he added.

    [15] Interior Minister Voutsis urges all Greeks to participate in referendum

    Interior and Administration Reconstruction Minister Nikos Voutsis urged all citizens to participate in the upcoming referendum on the creditors' proposals on July 5, during a press conference ahead of the vote on Tuesday.

    The minister said that to reduce citizens' travel expenses to the place where they will exercise their voting right, amid restrictions on bank withdrawals, the relevant ministries are negotiating with long-distance transportation and coastal shipping companies to provide free or reduced services.

    He also rejected claims that the referendum will cost 110-120 billion euros, saying it will be about 20 million, adding that the ministry signed a "favourable agreement" with Singular Logic for the processing and transmission of the result which he expects to be clear about 1.5-2 hours after the ballot has closed.

    [16] Defence Minister Kammenos: I do not accept any ultimatum

    Defence Minister Panos Kammenos said that the condition for whatever solution, which we also wish for, is that there will be no disarmament of the country, impoverishment of the armed forces and that the special VAT rate on islands will be fully respected.

    He also reiterated that "I do not accept any ultimatums...without these two conditions, no solution will be discussed."

    [17] Finance Ministry official: We want a proposal that will make the debt sustainable

    "When we are offered a credible proposal that will at least insinuate the possibility of a viable solution, we will be the first ones that we will take advantage of it," a senior Finance Ministry official said adding that "if there is nothing to constitute the debt sustainable, it is not worth mentioning. We want a viable solution."

    According to the same source, "all agreements submitted are slightly different from 25 June's proposal."

    [18] Merkel: 'Door remains open' for talks with Greece

    BERLIN (ANA-MPA/ F. Karaviti)

    "The door is open for talks with Greece," German Chancellor Angela Merkel told reporters on Tuesday, while adding that she was unaware of any breakthrough in the efforts for a last-minute agreement before midnight.

    Asked about the European Commission's efforts for talks with Athens before the deadline, Merkel noted that this expires at exactly midnight and that she knew of "no solid indications to the contrary."

    "All I know is that the Commission's last proposal that is known to me is from Friday last week. I have nothing more," she said.

    Speaking during a joint press conference with Kosovo's Prime Minister Isa Mustafa, she indicated that talks might continue even after the expiration of Greece's second bailout programme at midnight, central European time.

    Lines of communication with Greece will not be cut off, she said, adding that this was not customary in Europe.

    [19] German Chancellor had improved on Eurogroup offer to Greece last Friday, Der Spiegel reports

    BERLIN (ANA-MPA/ F. Karaviti)

    German Chancellor Angela Merkel has apparently told SPD lawmakers that she presented proposals to Greece last Friday that far exceeded the line set by eurozone finance ministers, according to a report in the German magazine 'Der Spiegel' on Tuesday.

    Merkel had asked Greek Prime Minister Alexis Tsipras to agree to an extension of the existing programme for Greece in exchange for a third bailout package, a partial restructuring of Greece's debt and investments amounting to 35 billion euros, 'Der Spiegel' reported.

    Meanwhile, sources at the private television station n-tv said that Finance Minister Wolfgang Schaeuble told a meeting of CDU/CSU MPs that Greece can remain in the eurozone, even if the referendum on Sunday returns a 'no' vote.

    The article noted that the first two points were particularly sensitive and that Merkel would have trouble getting them past her own Parliamentary group if Tsipras agreed.

    The same report pointed out, however, that the CDU/CSU Parliamentary group meeting was addressed only by Finance Minister Wolfgang Schaeuble, who categorically denied that any such proposals were put to the Greek side.

    [20] The door is still open to reach an agreement, but time is running out, EU Commission spokesman says

    BRUSSELS (ANA-MPA/M. Spinthourakis)

    European Commission spokesman Margaritis Schinas on Tuesday, referring to the negotiations with Greece, reiterated European Commission president Jean-Claude Juncker's statement that the door is still open to reach an agreement, but time is running out.

    He also said that Monday evening the Greek Prime Minister spoke on the phone with Juncker. He added that the contacts between Athens and Brussels continue on Tuesday.

    [21] Cyprus president talks to German Chancellor on Greece

    NICOSIA (ANA-MPA/ A. Viketos)

    Cyprus President Nicos Anastasiades on Tuesday held talks with German Chancellor Angela Merkel on the telephone regarding developments in Greece.

    A tweet by Cyprus government spokesman Nikos Christodoulides said the aim was to achieve an agreement on a support programme for Greece.

    Earlier, Christodoulides said that the Cyprus president intends to contact the heads of EU institutions and member-states to discuss the Greek issue.

    On Monday night, Anastasiades spoke with Prime Minister Alexis Tsipras and discussed the developments, Christodoulides said, while stressing that this was not just a chat and that they had agreed on what Anastasiades would say during his contacts.

    The spokesman said the goal of the Cyprus president's contacts was to achieve what all sides practically wanted, which was an agreement even at the last minute and for Greece to remain in the eurozone.

    Meanwhile, Cyprus Parliament President Yiannakis Omirou sent letters to the European Parliament President and speakers of eurozone member-state parliaments concerning Greece.

    [22] German FinMin Schaeuble says it's up to Greece to avoid bankruptcy and Grexit

    BERLIN (ANA-MPA/F. Karaviti)

    German Finance Minister Wolfgang Schaeuble said on Monday that it is up to Greece to avoid a Grexit and bankruptcy, adding that the country's partners are always willing to return to the negotiating table with Athens.

    Speaking to talk show "Brennpunkt" on German public broadcaster ARD, he clarified that negotiations would have to start from scratch, as the current aid programme expires on Tuesday.

    He said Greeks must understand that if someone wants to stay in the euro one has to create the circumstances.

    Concerning the referendum the government has called for next Sunday (July 5) over the creditors' last proposal to Greece, the minister said it is the country's right, adding that he's not clear on what Greeks will be voting for.

    "Every nation is sovereign on which government to elect. Nobody intervenes in this from outside. We always say that this is a sovereign decision of the Greek people, as is Greece's right to hold a referendum. That's not even a question. But others are committed by their own rules. You have to agree on that with the other. And this government has ruined any trust, while it removed from the current proramme every basis," Schaeuble noted.

    The minister also said that Germany is ready to help Greece and the Greek people, but "Greece itself will have to create the conditions."

    [23] 'I am infuriated because they do not treat Greece with honesty,' Social Democrats' member Schwan says

    "I am infuriated because they do not treat Greece with honesty," Gesine Schwan, a leading member of the German Social Democratic Party and twice presidential candidate of Germany said in an interview with ANA-MPA.

    "I get angry when I hear that Greece has done nothing, while before the Greek general elections Mr. Schaeuble was speaking with enthusiasm about the progress made by the Samaras government and the Greek people," she underlined.

    "The overall approach is not correct, apart from certain points, of course, such as the reduction in defense spending, but the pension cuts combined with increased medical charges are not. A viable reform of the pension system is required, but this cannot be realised in a day," she added.

    "The situation is critical, so is politics, and that is why I guess that Mr. Tsipras will be eventually forced to make some difficult concessions. It would facilitate if there was a prospect of debt restructuring, a perspective for a change," Schwan stated and added: "We must help Greece with various projects. With long-term provision and patience."

    The full interview is available for subscribers at ANA-MPA website.

    [24] ND leader Samaras: Referendum is about 'Yes' or 'No' to euro and Europe

    The dilemma on which Greek citizens are invited to decide upon on Sunday in the referendum is a "Yes" or "No" to the euro and Europe, New Democracy leader Antonis Samaras said on Tuesday.

    Samaras noted that foreign European leaders like Frances Francois Hollande, Italy's Matteo Renzi and European Parliament chief Martin Schulz have clarified that a possible "No" in the referendum would mean "No" to Europe and elaborated on the consequences of a negative vote.

    He said a "No" vote would make it difficult for pensions to be paid, as well as wages in the public and private sector as public revenues will have collapsed and businesses will not be able to pay.

    Samaras also cautioned that if Greece goes bankrupt, farmers would lose their subsidies, as European institutions will withhold all EU funds.

    [25] SYRIZA calls on Samaras to adopt position on specific austerity measures

    Replying to main opposition New Democracy leader Antonis Samaras, the ruling coalition's leading party SYRIZA on Tuesday accused him of "using lies and terrorism" to obscure the real point of the upcoming referendum on Sunday, in response to the creditors' ultimatum.

    It noted that the people had heard the scaremongering about a so-called exit from the euro before and given the appropriate reply.

    The party called on Samaras to adopt a position concerning specific austerity measures, such as the programme proposed by Greece's lenders, and not avoid talking about the real issues at stake.

    [26] ND spokesman attacks government over pension payment restrictions

    Main opposition New Democracy spokesman Costas Karagounis attacked Prime Minister Alexis Tsipras as a "teller of tall tales" on Tuesday. Far from protecting pensioners and restoring the '13th' pension as he had promised, Karagounis said, he had instead taken away the 7th.

    In addition to limiting all Greeks to 60 euros per day, or 420 euros a week, he had chosen to restrict pensioners without cash cards to a mere 120 euros a week.

    "For the storyteller, every pensioner is four times less important than any other citizen," Karagounis said.

    [27] Communist Party says referendum traps Greeks in a 'fake dilemma'

    The Communist Party of Greece (KKE) strongly criticised the scheduled referendum on the creditors' proposal on July 5, saying it traps Greeks into a "Yes" or "No" dilemma, without allowing other views to be discussed.

    "In the debate that took place in the interparty committee on the referendum of July 5, we ascertained the reactionary character of the institutional framework of the 'Law on referendums', which limits participation in the debate of political parties and limits between a 'Yes' and a 'No'," the party said on Tuesday, following a debate in a parliamentary committee.

    KKE also said it will participate in the referendum but rejects the "fake dilemma" of the ballot, while also urging people to reject it as well. The party also asked for an equal coverage of all parties represented in the Greek and European parliament from electronic media.

    [28] Kremlin: We are watching closely the developments in Greece

    MOSCOW (ANA-MPA/Th. Avgerinos)

    The Russian government is closely watching the developments in Greece, stated Russian President Vladimir Putin's spokesman Dmitry Peskov earlier on Tuesday.

    "This issue is between Greece and its lenders, however, we are watching very closely the developments".

    [29] 'A knowledge of simple maths required'. Op-ed by Greek journalist Giorgos Harvalias

    First off, let's make something clear. There is no 'drachma lobby'. Not in Greece, at least. This is a cheap invention by a part of the systemic opposition, in its effort to prove that big domestic interests are supposedly conspiring to return the country to its national currency.

    Only, something of the sort does exist, unless the conspiracy is being silently woven by marginal parties and public figures that do not express even one tenth of the electoral range.

    The truth is therefore different. Powerful elements in the country fervently wish to preserve the monetary status quo of the last 15 years. As one body, Greece's business oligarchy and the financial institutions that represent it are whole-heartedly in favour of staying in the euro 'at all costs', even at the expense of social cohesion. The same is true of the overwhelming majority of the major media that influence public opinion.

    For the current leftist government also, remaining in the eurozone is the dominant view. Otherwise, its leader would not have put his signature to an onerous and highly recessionary package of austerity measures amounting to 8 billion euros. With one crucial difference: contrary to the deterministic dogma for the euro at all costs, Mr. Tsipras' viewpoint links the economic sustainability of our painful stay in the European currency with a resolution of the debt problem.

    Understanding the Tsipras approach does not demand great knowledge. Nor does it require complex arguments in order to become commonly understood. Simple primary-school mathematics point to its correctness. Because when the debt of the country is determined worldwide in correlation with its GDP and the last is being constantly decimated by memorandum policies, it becomes clear that there is no cure.

    There is no doubt that the institutions' proposals for loan assistance, in all their versions, intensify the recession spiral, are extremely anti-growth and sink living standards further, thus intensifying the debt problem. The IMF itself has admitted this, after the fact, which in its unfavourable but nevertheless predominant scenario predicts the evolution of Greece's at 142.2 pct of GDP in 2022, or 25 percentage points above last year's forecasts! For this reason, it proposes further lending to Greece with a third memorandum, forgetting its prior position for immediate debt relief.

    There is no serious economist on the planet today that claims that the Greek debt is sustainable. Some dare and whisper this at home, ostrich-style, and some shout it abroad, because they do not want to give (the current government at least) such help. Truth be told, this is exactly where the negotiations stumbled. Not on the 'nuts and bolts' of the tax-collection ideas.

    We should not delude ourselves. Accepting additional loan agreements without a bold debt settlement will convert Greece into a zombie-state of the eurozone, a cheap, 'competitive' spa where central European tourists will wash their feet and locals will be searching through rubbish.

    The problem is that the current government, which has a better graps of the mathematics than the previous ones, is not in a position to guarantee an alternative solution with safer conditions of survival than the humiliating stay in the euro. More dignified, perhaps. But certainly not easier.

    [30] Government creates website with information on upcoming referendum

    The General Secretariat for Information and Communication on Tuesday announced the creation of a new website, in Greek and English, providing information to local and foreign news media concerning the referendum on July 5 at the web address: http://www.referendum2015gov.gr

    [31] Parliament suspends all planned sessions from Wednesday until Friday

    The Conference of Presidents in the Greek Parliament on Tuesday decided to suspend all Parliamentary sessions (legislative, Parliamentary control and committees) on Wednesday, Thursday and Friday until Sunday's referendum.

    A draft bill on nationality that was scheduled for Wednesday will be tabled on Tuesday afternoon next week and continue on Wednesday. Monday's sessions will be devoted to Parliamentary control.

    [32] There is no problem right now with medicine supply, Pharmaceutical Association says

    There is no problem right now with medicine supply, the Panhellenic Pharmaceutical Association on Tuesday said.

    The Association underlined that "medicine is not a consumer product to store, but a social good that we should get when we are in need."

    [33] Solution found for Evros border policing after EU funding programmes expired on Tuesday

    A solution has been found that will allow border police to continue the 'Aspis' operation for guarding Greece's northeastern borders and controlling migration flows in Evros after the expiration on Tuesday of special EU funding programmes, the civil protection ministry said.

    Ministry sources also noted that an enhanced strategic plan for the Aegean, with greater FRONTEX participation in terms of personnel and resources, will go into operation around the second week of July. More details concerning the plan, in which funding for Greece has been tripled to 18 billion euros, are to be announced over the coming days.

    According to the announcement, the problems were resolved by continuing the operation with locally based police officers, based on a decision taken by the leadership of the Hellenic Police and approved by Alternate Minister for Civil Protection Yiannis Panoussis.

    The reorganisation was necessary because a large border police presence in the area had previously been detached from other areas of Greece and thus received special bonuses to cover the costs of living away from home, which were covered by the EU programmes that expired on Tuesday.

    The issue was resolved by use of 547 local police officers, who volunteered to participate in the border force without any additional pay and a reorganisation of the forces and operational resources in the Eastern Macedonia-Thrace region.

    Another major problem concerned financing for the reception and detention facilities for migrants, especially for food. This was resolved through an internal loan of six million euros approved by the government that is expected to suffice until December, at which time there may be new financing from EU programmes.

    Financial News

    [34] Fitch downgrades Greek banks to 'RD' on capital controls

    Fitch Ratings downgraded Greece-based National Bank of Greece, Piraeus Bank, Eurobank Ergasias and Alpha Bank's Long- and Short-term Issuer Default Ratings (IDRs) to 'RD' from 'CCC' and 'C', respectively.

    The ratings reflect exceptionally high levels of credit risk, because of the imposition of capital controls as well as poor recovery prospects in the event of the default on senior debt obligations, due to very weak asset quality and high levels of preferred liabilities and asset encumbrance.

    [35] S&P lowers credit ratings on four Greek banks to SD

    Standard & Poor's Ratings Services on Tuesday lowered its long- and short-term counterparty credit ratings on Alpha Bank, Eurobank Ergasias, National Bank of Greece, and Piraeus Bank to 'SD' (selective default) from 'CCC/C' and also lowered the issue ratings on the banks' senior unsecured debt to 'CCC-' from 'CCC'. The credit rating agency finally affirmed its 'C' subordinated debt ratings on the four institutions.

    The downgrades to 'SD' follow the measures introduced by the Greek government on Monday June 29. Specifically, these include limits to deposit withdrawals, the closure of bank branches for a full working week, and the prohibition of money transfers out of Greece unless authorized by the Greek Ministry of Finance. "The rating actions reflect our opinion that private individuals' lack of access to their deposits on a timely and in-full basis, and the constraints to their ability to transfer funds, constitute a selective default under our criteria. Our downgrade of all outstanding senior unsecured notes to 'CCC-' reflects our opinion that it is now inevitable that Greek banks will default within six months in the absence of support from the EU authorities; we do not anticipate such support will be forthcoming," S&P said.

    "Following the interruption of negotiations between the international authorities and the Greek government, the ECB announced on June 28 that it is maintaining the emergency liquidity assistance it provides to Greece's banks at the level set on June 26, around ? 89 billion. In our opinion, this has left the Greek banks with very limited liquidity buffers to cover their upcoming needs, taking into account the large deposit withdrawals they have experienced in recent weeks. We understand the finance minister could further extend, or shorten, bank closures," the credit rating agency noted, adding that "We view the banks' liquidity positions as having weakened further after these recent events, which we see as constraining the banks' ability to meet their upcoming financial obligations, when due. We therefore believe the default of the Greek banks is a virtual certainty unless unexpected additional external support materializes. As such, we have revised down our stand-alone credit profile for all the four Greek banks to 'cc' from 'ccc-'.

    [36] Greek PPI down 4.6 pct in May

    Greece's Producer's Price Index in the industrial sector (measuring both the domestic and external markets) fell by 4.6 pct in May this year, compared with the same month in 2014, after a 0.6 pct increase recorded in the 2014-2013 period, Hellenic Statistical Authority said on Tuesday.

    The statistics service, in a report, attributed this development to a 4.0 pct decline in the domestic market index and a 6.1 pct fall in the external market index. The country's producer's price index rose 0.7 pct in May from April, after an increase of 0.3 pct recorded in the same period last year.

    [37] FinMin Varoufakis rejects rumours of lowering cap on cash withdrawals

    Greek Finance Minister Yanis Varoufakis rejected categorically rumours that the government is considering lowering the daily cap on cash withdrawals from ATMs to 20 euros from 60 on Monday evening, saying "no such issue is considered", following a meeting he held with the heads of the country's four systemic banks.

    Representatives of the banks, who exited from the meeting confirmed Varoufakis' statement, saying their talks revolved around pensioners who don't own cash cards. During the talks, the minister and the banks' top executives examined ways to allow those pensioners to withdraw more than 60 euros per day from bank tills so that they don' t have to return every day.

    [38] Retail sales volume index down 1.9 pct in April

    Greek retail sales volume fell 1.9 pct in April this year, with only two shop categories recording an increase in sales: bookstores (5.6 pct) and furniture/electrical appliances (0.9 pct) in the month.

    On the other hand, sales fell in clothing/footwear (8.1 pct), department stores (5.1 pct), food/beverage/tobacco (4.7 pct), pharmaceuticals/cosmetics (2.7 pct), supermarkets (1.1 pct), fuel/lubricants (0.9 pct).

    Hellenic Statistical Authority, in a report released on Tuesday, said that the retail sales volume index (turnover in fixed prices) fell 1.9 pct in April compared with the same month last year, but rose 4.4 pct from March 2015.

    The turnover index (current prices) fell 3.3 pct in April from the same month last year, but rose 5.5 pct from March 2015.

    The seasonally-adjusted retail sales volume index fell 2.2 pct in April (yr/yr) and by 0.7 pct on a monthly basis. The seasonally-adjusted turnover index fell 3.0 pct yr/yr and was down 1.1 pct on a monthly basis.

    General News

    [39] Light quake jolts Pylos

    A light quake measuring 4.4 on the Richter scale was recorded on Tuesday at 09:07 at the sea region southwest of Pylos, southern Greece.

    Weather forecast

    [40] Clouds, rain on Wednesday

    Clouds, rain and northerly winds are forecast for Wednesday. Wind velocity will reach 7 on the Beaufort scale. Partly cloudy in the northern parts of the country and temperatures ranging from 17C-27C. Clouds in the morning and rain in the afternoon in the western parts with temperatures between 17C-29C. Same weather in the eastern parts and temperatures between 15C-30C. Clouds over the Aegean islands; rain over Crete, 18C-29C. Partly cloudy with a chance of rain in the afternoon in Athens, 19C-29C; the same for Thessaloniki, 18C-26C.

    [41] The Tuesday edition of Athens' dailies at a glance

    AVGHI: No or elections. Prime Minister Alexis Tsipras' clear message

    DIMOKRATIA: Pensions with tears

    EFIMERIDA TON SYNTAKTON: I will not be humiliated

    ELEFTHEROS TYPOS: 'Yes' he leaves, 'No' we return to drachma

    ESTIA: The closure of banks paralyzed everything

    ETHNOS: Anxiety over pensions

    IMERISSIA: The country has frozen. Shock in economy-society

    KATHIMERINI: Signs of decomposition in the country

    NAFTEMPORIKI: Shutters on the economy

    RIZOSPASTIS: Do not let the people bankrupt

    TA NEA: Default in the economy

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