Selasa, 20 Maret 2012

Around the horn in Greece - items of interest

Potato movement shifts 15-17 million kilos of produce
20 Mar 2012
The Potato movement bypasses established distribution and sales networks
The Potato movement bypasses established distribution and sales networks
More than 15-17 million kilos of potatoes from the Nevrokopi basin have been sold direct to consumers through the "Potato movement", bypassing middlemen, local potato farmers said on Tuesday.
They stressed their determination to continue supplying consumers with discounted potatoes in the new season beginning next September.
Farmers said the unsold quantities of potatoes remaining are just three to four million kilos, which at current rates will be exhausted in roughly a week to 10 days.
Though the amounts sold direct to consumers are impressive given the short space of time involved (20-30 days), they are nevertheless dwarfed by the region's total production, which is estimated at 100 million kilos. This was mostly sold before the Potato movement was launched, at the extremely low price of 0.11-0.12 euros per kilo, which according to farmers is about half the cost of production without calculating packaging and transport.
Local farmers stressed that they would strive to sell direct to consumers in the next season, at prices significantly lower than those of supermarket shelves but still much higher than those earned through the middlemen.
"Until today, we sold potatoes at a low price and we did not get our money directly. When we sell direct to consumers, as we did this year, we have cash to buy our supplies and do our work properly," said farmer Savvas Simeonidis, congratulating the volunteer group from the Pieria prefecture that made the scheme possible.
Other farmers warned, however, that once domestic supplies were depleted and imported potatoes appeared on the shelves, consumers might see prices spike as high as 1.50 euros a kilo. (AMNA)


News bites @ 5
by Makis Papasimakopoulos20 Mar 2012
1. OTE PHONE HOME. Greece's biggest telecom operator, is facing increasing problems dealing with the effects of the financial crisis and heavy regulation. The company, losing 100.000 customers each year, to smaller and cheaper providers on the market, has vowed to resist legislation pressures to fire staff and hopes to counter increasing competition as well as stop profits bleeding out, through a series of investments and cheaper packages.
2. YOU SHALL NOT PASS. Unpaid staff at the Sotiria hospital were allowing no new patients to enter the premises on Tuesday morning, as they protested cost cutting measures in the National Health Service and demanded a settlement for salaries not yet received. The Sotiria is set to merge with the General State Hospital later this year.
3. STOPPING VIOLENCE ALL OVER AGAIN. It was very much a case of déjà vu on Tuesday, as the voices coming out of the cabinet meeting, headed by Prime Minister Lucas Papademos, sounded all too familiar. Papademos, Minister for Citizen Protection Mihalis Hrysohoidis, as well Minister for Culture, Tourism and Sport Pavlos Geroulanos voiced their conviction that all those involved in the riotous incidents during Sunday's league match between Panathinaikos and Olympiakos, would be brought to justice. Furthermore, Geroulanos stated that the new legal framework for sport would effectively deal with such incidents once and for all. Positions like these however, have been expressed way too many times in the past, but have failed to effectively deal with what is indeed Greek football's most crippling problem.
4. HERE COMES NUMBER ONE. Greece has received the first 7.5 billion euros of aid from its new EU/IMF bailout, with the bulk of the payment going to repay bonds held by the euro zone's central banks, government officials said on Tuesday. Greece would use this money to pay 4.66 billion euros to the European Central Bank and other euro zone national central banks for the capital amount of a 3-year bond which expired on Tuesday.


Greek banks blamed for spike in emergency ECB borrowing
20 Mar 2012
file photo
file photo
Banks borrowed over 11.5 billion euros of emergency overnight funds from the European Central Bank for a second day running on Tuesday, a spike money market experts put down to Greek banks juggling their cash because of the country' debt restructuring.
Banks are usually reluctant to use the ECB's instant access facility - also known as its emergency window - because it charges 0.75 percentage points more interest than normal ECB funding.
This week's jump, however, is the second time this month that overnight borrowing has surged.
Money market traders believe is it a knock-on effect of a complicated arrangement the ECB put in place to avoid Greek bonds becoming unusable in its lending operations following the country's debt swap deal currently going through.
The original plan, to use 35 billion euros of EFSF bonds as a sweetener for the ECB to continue lending to banks with Greek collateral as normal, fell apart when the EFSF bonds couldn't be transferred to the central bank in time.
That forced the ECB to push the banks out of its operations and into the Emergency Liquidity Assistance (ELA) facilities that national central banks can provide.
On March 8th, the ECB reopened its doors to Greek collateral after the EFSF bonds finally arrived and almost immediately use of the ECB's overnight facility jumped to over 15 billion euros.
It dipped below 2 billion after last week's injection of 7-day mainstream ECB funding but has spiked again as - according to traders - banks receive more of their collateral back and get it in shape again for the ECB's regular operations.
"I don't think it (the jump in overnight borrowing) is anything sinister," said one London-based money market trader. "The view in the market is that its just Greek banks moving after Greek bonds become ineligible earlier in the month."
A second trader added that it made sense for Greek banks to borrow overnight from the ECB.
"The ECB marginal rate is still cheaper than anything these banks could get on the street and it also ensures the collateral is visible to the central bank so it can be used in the weekly operation or the 3-month one that settles next week," he said.
A higher-than-expected uptake of new 7-day ECB funds on Tuesday also backed the theory. Banks took just under 60 billion euros, 18 billion more than last week and well above the 40 billion predicted by traders polled by Reuters. 
"I'm sure what we'll see is that pretty much all of this money (overnight borrowing) now switches into the MRO (ECB 7-day funding operation), and then next week it will go into the 3-month tender," the second trader added.
While heavy usage of overnight ECB funding can be an indication that a bank or banks - the ECB does not disclose who uses the overnight facility - are having problems getting financing, there are a number of other possible explanations.
Banks can also simply miscalculate their funding needs and take overnight ECB cash rather than risk their reputation by scavenging for money on the open market.
At the end of last year, overnight borrowing briefly surged to over 17 billion euros after Franco-Belgian lender Dexia had been bailed out. Earlier that year it also jumped as one of Ireland's banks prepared to sell off some of its assets, leaving it in temporary need of the funds. (Reuters)

and still no date for the election .....

Date for elections still pending

 Papademos meets Samaras but no decision on elections as more work lies ahead
A meeting between Prime Minister Lucas Papademos and New Democracy leader Antonis Samaras late Tuesday did not lead to a date for the general elections being fixed as the ballot will depend on the interim government completing the legislative work it has taken on as part of Greece’s new rescue package from the eurozone and the International Monetary Fund.
The two men met a few hours after it was confirmed that Greece had received the first, 7.5-billion-euro tranche of its new bailout. Papademos and Samaras did not make any comments after their meeting. New Democracy is known to favor April 29 as the election date but it is possible that the government will not have completed its task until a few days before Greek Orthodox Easter on April 15. This means the election may have to take place on May 6 or 13.
Concerned that his party is losing support to Independent Greeks, a new group formed by ND outcast Panos Kammenos, Samaras is considering welcoming back as many as seven ousted conservative deputies, sources said. MPs were due to vote later on Tuesday on Greece’s EU-IMF loan agreement and Samaras appeared ready to accept the return of any outcasts who would support the agreement in the parliamentary ballot.
Samaras is due to leave Wednesday for a trip to Madrid and Lisbon to meet the conservative prime ministers of Spain and Portugal with a view to creating an alliance that might be able to press for more measures to boost growth on a European level. Samaras is due to return to Greece on the evening of March 25.
In his first speech to PASOK MPs since taking over the leadership of the party, former Finance Minister Evangelos Venizelos suggested he was open to being part of a coalition government after the elections but nevertheless drew dividing lines between the Socialists, New Democracy and the leftist parties.
“Some people are asking for a self-sufficient government, we want a self-sufficient Greece,” Venizelos said in reference to Samaras’s suggestion that he wants a clear majority to avoid forming a coalition. In a bid to differentiate PASOK from its election rivals, Venizelos said the proposals by the left were “unrealistic” and that ND was “undecided,” beholden to its old-style party politics and the “theory of political cost.”
Venizelos’s successor as finance minister is due to be named Wednesday. Deputy Finance Minister Filippos Sachinidis and Interior Minister Tassos Yiannitsis are the favorites to take over.

and Greece creditors get the lion share of the first tranche of the greek creditor bailout .....

Escrow account gets first deposit

 IMF warns the second package may not be enough
By Sotiris Nikas
The escrow account created for the repayment of Greece’s debts was activated on Tuesday as the eurozone paid the first cash deposit of 4.9 billion euros into it from the second bailout package, to cover maturing bonds held by the European Central Bank.
This was the bulk of the first installment of 5.9 billion euros from the eurozone’s second package that was credited to Greece on Monday, with just 1 billion of that going into a Greek state account, held by the Bank of Greece, for the country’s needs.
Along with the tranche from the eurozone, Greece also received some 1.65 billion euros from the contribution of the International Monetary Fund, meaning that its balance this week has been boosted by a total of around 2.6 billion euros.
The flow of capital has been planned in a way that will satisfy all of Greece’s obligations both domestically and abroad, according to Finance Ministry officials who stressed that there should be no problems with the state’s cash reserves.
Greece’s funding needs for the first couple of years after the completion of the new bailout program -- i.e. in 2015 and 2016 -- will amount to 21 billion euros, according to the IMF, and it is not known where this money will come from. Consequently the markets are beginning to factor in the need for a third bailout, although IMF chief Christine Lagarde argued on Tuesday that Greece can get back on the right track provided it implements the new program in full.
However the IMF’s managing director sent a message to the next government in Athens, saying that “there is still great scope for an increase in state revenues through tax collection.” Questioned about any social unrest that may follow, she responded that “it is necessary for everyone to understand and accept the sacrifices that must be made.”
Similarly, US Treasury Secretary Timothy Geithner said on Tuesday in Washington that “Greece is making progress toward sustainability. Whether they get there or not is going to depend hugely on whether they can sustain political support.”

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