Friday 29 May 2015

Launching BestInvest: Cyprus Investment Conference and Exhibition

In association with Cyprus-Russian Business, Navigator is pleased to announce the launch of the BestInvest Cyprus, an investment exhibition and conference focusing on Cyprus. The conference will take place at the Four Seasons Hotel in Limassol on 18-20 October 2015.
In March 2013, Cyprus became the fourth Eurozone country to receive emergency financial assistance, touching off a recession. With economic growth now resuming and major new investments now launched, the BestInvest Conference provides investors and policy-makers with a detailed and informed update of investment projects and opportunities in Cyprus.

The Conference Agenda
The BestInvest Conference is a 1-day event providing a balanced and comprehensive assessment of the Cyprus economy and investment opportunities. It is oriented towards practitioners and provides a state-of-the-art review of main issues and opportunities.

The Investor Delegation
A key differentiator of BestInvest Cyprus is our focus on attracting investors to Cyprus. Accordingly, we have arranged for an Investor Delegation, comprising group of leading investment funds, high net worth individuals and other qualified investors. Contact us if you would like to participate as an Investor.

The Investment Exhibition
A key part of the BestInvest Cyprus is the Investment Exhibition, comprising 20 exhibition stands featuring investment projects from vetted investment sponsors. The Exhibition will be open to the public and will take place on 18-19 October. Contact us if you would like to participate as an exhibitor.

The Investment Project Site Visits
In order to view investment opportunities in Cyprus, Site Visits have been organised for the BestInvest participants. There will be two field trips scheduled: to Eastern and Western Cyprus. View the Site Visit schedules here. Register for a Site Visit.

Conference Organisers
The BestInvest Cyprus conference is organised by two partners with an in-depth and impartial understanding of the Cyprus investment climate and economy:
  • The Successful Business Magazine was founded in 2010 by the Vestnik Kipri media organization. Successful Business provides a quarterly analysis of Cyprus political, economic, financial and business developments and is considered mandatory reading for all analysts and executives operating in or addressing Cyprus today.
  • Navigator Consulting Partners is an investment advisory consultancy with in-depth experience in Cyprus since 1995. Navigator provides a range of consultancy services, including due diligence, investment analysis, financial planning, business planning and risk analysis, and has in-depth experience in tourism, hotel investments, food and beverage, property, renewable energy and other relevant sectors.

For further information, please Contact Us.

A conference website is coming soon. Additional information can be found on our Events page: Navigator Events: BestInvest Cyprus

Thursday 28 May 2015

Tax on ATM Withdrawals cancelled 3 hours after it is announced

Apparently less than three hours after it was announced by Minister Varoufakis, the Ministry of Finance withdrew the idea of taxing cash withdrawals from ATMs. (see for instance Reuters: Greece says ATM levy, bank transaction tax no longer being discussed / 26 May 2015). 

This policy reversal is only the latest of a series of similar actions that drastically limits confidence and leads many to question whether SYRIZA has any control on basic policy making. 

These fears have increased in the face of a public relations offensive in the last two days, which had Greek government officials claiming that the agreement with creditors was in sight, and even that “the final agreement is being written). 

These claims have been dramatically repudiated by various Eurozone parties in the last 36 hours. 

European Commission insiders are insisting that Greece is NOT, repeat NOT, on the brink of a deal, despite Tsipras’s optimistic comments.

One official has told Reuters that the remarks coming out of Athens are “nonsense”.
Another said: “I wish it were true.”

Reuters also has the full rebuttal from European Commission Vice President Valdis Dombrovskis. He said: “We are working very intensively to ensure a staff-level agreement. We are still not there yet.”

Jean Claude Juncker has stated things quite succinctly in recent comments reported in the Guardian and other media: 

 “He is not helping the process. Mr Varoufakis is the finance minister of a country that has to confront huge problems and he doesn’t give the feeling that he knows that.” These comments from the EC president to the MNI news agency have caused a stir with every major news outlet leading on Jean Claude Junker’s indictment of the Greek finance minister.

“Essentially, Mr Juncker with his response is accusing Mr Varoufakis as the reason why negotiations aren’t moving forward,” the news portal wrote this evening.

While insisting that he could trust Greek prime minister Alexis Tsipras, the EU chief’s description of his radical left Syriza party as “abnormal” has also sent tremors through the political scene.

Meanwhile, the Tsipras’ government issued a non-paper tonight saying today was spent reworking “different issues so that precious time isn’t lost.”

Not many in the EU would agree with that.

One EU official recently said: “if we go at the speed the Greeks are negotiating the process will conclude in April 2017.”

It is increasingly clear that events relating to the Greek debt negotiations over the past two weeks have been increasingly driven by domestic political calculations, and mainly the need to arbitrate political responsibility for the termination of SYRIZA’s “September Programme” and the subsequent “SYRIZA Somersault”. 

As a result, while I continue to believe a deal will be struck, it is difficult to say when this will in fact occur, and whether this will occur by the date of the next debt repayments. 

Even assuming a deal is struck and € 7.2 billion in Bailout II funds are finally released, Greece’s financing needs are much greater between July – December 2015, as is widely acknowledged. 

Political instability is therefore set to continue throughout 2015 and very likely into 2016 as well. 

© Philip Ammerman, 2015 

Tuesday 26 May 2015

Varoufakis now confirms recording talks (after denying it)

Contradicting himself once again, Greek Minister of Finance Yanis Varoufakis has now admitted to recording the Riga Eurogroup meeting, after initially denying it. 

Originally, he declared that he recorded the meeting in an interview with NYT reporter Suzy Hansen ( A finance minister fit for a Greek tragedy, 20 May 2015). This caused an international furor. 

Now, in an interview with the BBC's Andrew Marr (AFP: Varoufakis admits recording stormy Riga meeting / 24 May 2015), he claims that he recorded himself mainly 

"to be able to recount my exact phrases and, accordingly, to brief my Prime Minister, the Cabinet, Parliament etc. on precisely what I said"

Otherwise, it's all fairy tales. 

Greece's credibility is already at an all-time low. This narcissistic flip-flopping doesn't help. 

(c) Philip Ammerman, 2015 

The SYRIZA Somersault

23 March 2015

SYRIZA Crosses the Line

31 January 2015

Greek Ministry of Finance examining tax on ATM Withdrawals

Kathimerini's Greek edition is reporting today that the Greek Ministry of Finance is examining a tax on ATM withdrawals (Βαρουφάκης: Εξετάζουμε φόρο στις αναλήψεις απο ΑΤΜ / 26 May 2015)

This confirms an earlier article in the Mail Online referred to in my post of 23 May 2015 (Kathimerini Report on Bank Deposit Tax).

In the present interview, Minister Varoufakis denies examining any other form of tax on bank deposits or transactions.

SYRIZA ministers have reportedly stated that the money runs out on June 5th, but that no capital controls are envisioned.

It remains to be seen whether this worthwhile but contradictory goal will be achieved.

(c) Philip Ammerman, 2015

Related Posts

28 April 2015 

Saturday 23 May 2015

Kathimerini Report on Bank Deposit Tax (Rebutted by MinFin)

Kathimerini is reporting on plans discussed between the Greek Ministry of Finance and the "Brussels Group" to levy taxes on bank deposits as well as other bank transactions. If confirmed (and the Ministry of Finance has rebutted this), it will bear out a Cyprus-style "bail in" of depositors that I seem to be hearing about.

Kathimerini reported today (Λεπτομέρειες από τις Βρυξέλλες για την κυβερνητική πρόταση επιβολής φόρου στις καταθέσεις / 23 May 2015) that the following measures were discussed: 

1. Increase on taxes for financial transactions
2. Tax on deposits in Greece and internationally
3. Amnesty for undeclared income in Greece and internationally
4. Tax of 0.1% on all bank transactions.

On May 5th, the Mail Online reported that the Ministry was considering levying a € 1 tax on every ATM withdrawal (Greece introduces cashpoint tax in desperate bid to raise revenue and stop run on banks as country teeters on brink of bankruptcy). I have not seen this confirmed in any other source. 

It is difficult to rely on press reports about what may or may not be decided. It is also difficult to judge given the fact that if leaked (and even once announced) such a measure would probably lead to further panic flight among Greek depositors. But this is once again in line with other items reported and press, and Troika statements about a "Cyprus-like" bail in.

Caveat emptor.

(c) Philip Ammerman, 2015

Related Posts

18 May 2015

28 April 2015

Latest Riga Summit Conclusions

Bloomberg, the FT and other sources are reporting that the latest Riga summit has concluded that the IMF is a full part of the Troika, and that the IMF's approval on structural reforms is necessary. The IMF, in turn, is reported as being opposed to a "quick and dirty review", as well as being opposed to rollbacks of earlier structural reforms made by SYRIZA.

Some indicative quotes seen this morning in the press:

Financial Times (Eurozone says no Greek deal without IMF / 22 May 2015)

IMF staff have told their board they would not disburse aid without a “comprehensive” deal that started to lower debt levels. They also want EU assurances that Greece will be able to pay its bills for the next 12 months, a demand that could require eurozone governments to commit to another bailout programme.

"It has to be a comprehensive approach, not a quick and dirty job," Christine Lagarde, IMF chief, said at an event in Rio de Janeiro on Friday.

Greek officials have told their eurozone counterparts they are worried about the IMF’s hardline stance and have argued their conditions are politically undeliverable, especially when it comes to the pension reforms, which remain the biggest stumbling block.

The IMF has clashed with the European Commission over how tough a line to take, with the commission going so far as to moot cutting the IMF out of a deal. But German officials have bristled at the commission’s interventions and have made clear all three bailout monitors — the IMF, the commission and the European Central Bank — must approve any deal.

Bloomberg (Merkel, Hollande Tell Greece to Take Route A to Agreement / 22 May 2015):

A government official, in a debriefing after the talks broke up about 1 a.m., signaled Greek frustration by saying that a main obstacle is that the International Monetary Fund needs to be on board. “Open issues” remain with creditors, including pensions, sales-tax rates and targets for a primary budget surplus, the official told reporters.

A short statement released separately by the French and German governments after more than two hours of talks with Tsipras was devoid of earlier optimism expressed by Hollande at paving the way for an accord as soon as the end of the month. In its place, the governments of the two biggest euro-area economies talked of agreement “to stay in close contact.”

While the IMF is in principle correct in questioning whether Greece is committed to reforms, and whether it will be able to sustain funding targets in 2015, some of the IMF's insistence on reforms is misplaced.

I refer, for instance, to the Fund's insistence that collective bargaining restrictions be lifted in Greece. Greek law already allows for sufficient latitude to dismiss workers: I have seen this first hand during involvement in a Greek privatisation in 2013.

Moreover, it is difficult for anyone involved with the "real" Greek economy to understand why this is even a priority right now. There is not a single investor I know for whom collective bargaining is a serious issue regarding operations in Greece right now. On the contrary: there are far more important  challenges to investing or restructuring in Greece.

The main challenge is gaining government licensing for new investments or renovations of existing investments. We have seen on any number of occasions that gaining approval to build or even renovate a hotel, for instance, is beset with useless approval seeking from over 15 main authorities (with multiple steps typically necessary within each authority).

The second challenge is gaining respite from the huge bureaucracy (approvals-process) of normal operations in Greece. For instance, the approvals necessary to operate a restaurant, or to export a container of food, are insane, and useless for any real purpose of consumer protection.

The third challenge is the corruption that is engendered by the first and second challenges. The more approvals necessary, the higher the payoff necessary to operate.

I also don't see the IMF making any practical suggestions about reforming the justice system. Speaking frankly, the reason corruption and bad business practises survive in Greece is because getting a court decision can take years to resolve, and then the decisions are often never implemented by civil authorities. The IMF's focus on "improving the business environment" are interesting, but without focussing on the reality, these are mainly ivory-tower theory.

This is only one of many reforms which may look good on paper, but are not important in practise. Once again, a lack of prioritisation prevails.

Without knowing what SYRIZA will do, I'm beginning to wonder if this isn't the straw that breaks the SYRIZA back. If I myself am not convinced by certain IMF reform priorities, how will SYRIZA convince its own voters?

(c) Philip Ammerman, 2015

Related Posts

The Great Taxi Non-Liberalisation
1 April 2012

Thursday 21 May 2015

Deciphering Varoufakis – The Latest Installment

It is truly difficult to understand the Greek Finance Minister, Yanis Varoufakis.

In a recent profile in the New York Times (Suzy Hansen: A finance minister fit for a Greek tragedy, 20 May 2015), Varoufakis maintains that he is the victim of a smear campaign by journalists. Most interestingly, he states that he taped the April Eurogroup meeting. The NYT quote is seen below in bold italic:

According to Varoufakis, the tweet — he has more than 400,000 Twitter followers — was directed not at his fellow finance ministers, but at journalists. “The media went into a frenzy of obfuscations and lies, which I am sure they are not entirely responsible for,” he said. “It seems as if there were leaks from within that were disconnected from the reality of what happened. All these reports that I was abused, that I was called names, that I was called a time-waster and all that: Let me say that I deny this with every fiber of my body.” (He says he taped the meeting but cannot release the tape because of confidentiality rules.)

Today, Skai News reports that Varoufakis denies having recorded the Eurogroup meeting. The source is here: Βαρουφάκης: Επιστημονική φαντασία η παράταση, παραμύθια η ηχογράφηση, 21 May 2015. I reproduce this here in Greece with a free translation into English:

Ερωτηθείς για το πολύκροτο δημοσίευμα των New York Times που τον θέλει να έχει ηχογραφήσει τη συνεδρίαση του Eurogroup στη Ρίγα, ο υπουργός Οικονομικών απάντησε: «παραμύθια, παραμύθια, παραμύθια».

Asked about the sensational publication in the New York Times which claims that he recorded the Eurogroup meeting in Riga, the Finance Minister replied: "Fairy tales, fairy tales, fairy tales."

It is difficult to understand whether he is telling the truth (so far Suzy Hansen has not issued a clarification or retraction). This is one of a by now very large number of reversals, denials, miscommunications or gaffes this same Minister has made since SYRIZA’s election on January 25th.

This same Minister, on January 31st, was boldly promising no new loans, no loan conditionality, no loan monitoring team. It is the same Minister who has been “negotiating” for 4 months now precisely for new loans, with loan conditionality and a monitoring team which has been rebranded the “Brussels Group” instead of the “Troika”.

The next Eurogroup meeting promises to be even more interesting that what is strictly necessary.

(c) Philip Ammerman, 2015 

Related Posts

23 March 2015

19 February 2015

31 January 2015

Monday 18 May 2015

Troika Rhetoric on Greece increasingly resembles that on Cyprus

On April 28th (Notice of a probable Greek payment issue) I warned that the rhetoric emerging from Brussels on Greece was closely beginning to resemble that of Cyprus prior to the March 2013 bail-in.

This has now been confirmed by Peter Spiegel writing in the Financial Times yesterday (Tsipras Letter reveals precariousness of Greece's public finances May 17, 2015).

As Spiegel writes:

Greece came so close to defaulting on last week’s €750m International Monetary Fund repayment that the prime minister warned IMF chief Christine Lagarde he could not pay it without EU aid. Athens ultimately made the payment without financial assistance from the bloc but only by tapping a rarely used emergency account Greece holds at the fund — an unorthodox transaction that amounted to borrowing IMF funds to pay the IMF.

At the end of April, I was in Poznan, Poland in the week that Greek Finance Minister Gianis Varoufakis held a meeting with IMF Managing Director Christine Lagarde. Ms. Lagarde later stated that no advanced country had ever been late with an IMF payment, and that no extension would be granted to Greece.  -- a demand that Gianis Varoufakis later denied having made

According to Kathimerini and the Financial Times, this demand was made by Prime Minister Tsipras, irrespective of what Mr. Varoufakis did or did not do. 

But it is the confirmation in Spiegel's article about the language coming closer to an ultimatum--similar to what happened in Cyprus--which confirms what I have been hearing: 

A similar tactic was used in March 2013, when the Cypriot government was presented with a severe bailout plan and told it must agree or lose ECB support for its failing banking sector. The idea of a “Cyprus-like” presentation to Greek authorities has gained traction among some eurozone finance ministers, according to one official involved in the talks.

In fact, such a presentation has apparently been scheduled for the next Riga meeting, in which the Eurogroup heads of state will present Greece with their own suggestions for a way to resolve the structural reform issues. Whether this is a "take-it-or-leave-it" ultimatum remains to be seen.

To Vima also reports today on a plan mooted by Jean Claude Juncker to try to bridge both sides of the crisis. It remains to be seen if this is harsh enough to please the Eurogroup hawks and the IMF. I imagine it is not. The European Commission denied the existence of such a plan.

The SYRIZA government has been increasingly creative in its approach to managing debt:
  • It has repaid the IMF instalment by drawing down its own reserves at the IMF (which must be paid back within 1 month)
  • It has with-held or confiscated over EUR 900 million in EU funds for farmers and public works
  • It has refused to refund Value-Added Tax to exporters
  • It has stopped making nearly any kind of payment to the private sector 
  • It has seized cash reserves from other governmental or semi-government organisations. 

This policy can only run for so long. The fact that Prime Minister Tsipras continues to talk of "red lines" while refusing to make rational policy moves while being unable to maintain the normal operations of the state means that either a solution is coming soon, or Greece will default within the Eurozone. I remain convinced that a solution will be made, at terms dictated by the Troika, which contradict everything SYRIZA has promised. Whether SYRIZA can implement such an ultimatum remains to be seen.  

Thursday 7 May 2015

Prime Minister Tsipras celebrates the (re)hiring of 420 cleaning ladies into the Greek public sector

Photo (c) Iefimerida

Sadly, this is not a joke.

At a time when total employment in Greece has fallen to 3.55 million (out of a population of 10.7 million), and of these, over 750,000 work in the public sector, one would think that this is hardly a signal worthy of notice. But it has become a cause célèbre in the SYRIZA electoral pantheon. 

So, while Elon Musk is launching the PowerWall or while France is forecasting a 7% rise in industrial investments in 2015, in Greece we are celebrating the rehiring of cleaning women. 

A sample of the Prime Minister's discourse follows, in Greek: 

«Δεν πρέπει να ευχαριστείτε εσείς εμάς, εμείς πρέπει να ευχαριστήσουμε εσάς γιατί σε δύσκολες στιγμές δώσατε ένα παράδειγμα αυταπάρνησης και αγώνα. Και πρέπει να σας εκμυστηρευτώ και κάτι ακόμα. Ακόμα και στη συνάντησή μου με την καγκελάριο, χωρίς να αναφερθώ εγώ σε εσάς, αναφέρθηκε αυτή σε εσάς και είπε ότι ήταν άδικο αυτό που έκανε η προηγούμενη κυβέρνηση σε εσάς. Σκεφτείτε πόσο σημαντικό είναι όταν ένας αγώνας είναι δίκαιος, μπορεί να ξεπεράσει τα σύνορα. Και ο δικός σας αγώνας ήταν δίκαιος και ξεπέρασε τα σύνορα. Σκεφτόμαστε αυτή τη στιγμή ότι όπως ήσασταν εσείς τα προηγούμενα δυο χρόνια, σε ίδιες δύσκολες συνθήκες είναι χιλιάδες εκατομμύρια Έλληνες πολίτες, το μυαλό μας είναι σε αυτούς και το δικό σας πρέπει να είναι, το παράδειγμά σας όμως δίνει δύναμη».

Πηγή:  Οι καθαρίστριες με κόκκινο γάντι στο Μαξίμου [εικόνες] |