The government of Slovenia has
announced a package of measures it hopes will help avoid an EU bailout. The measures include a tax increase, a major restructuring of Slovenia's
ailing banking sector, and a programme of mass privatization. Slovenia's mostly state-owned banking sector is suffering from mounting bad
debts and the government has struggled to borrow money. The European Commission will now consider the plan. It is expected to deliver its verdict by the end of the month. Slovenia has been in recession since 2011, and analysts have cited it as the
most likely country to seek help from the EU following the bailout of Cyprus
earlier this year. European officials have expressed concern over the stability of the country's
banking sector, which is struggling under billions of euros of bad debts. Meanwhile the government's ability to borrow money was dealt a blow last week
when Moody's, a ratings agency, cut Slovenia's bonds to "junk" status. Despite this, the government was able to raise 3.5bn euros (£3bn; $4.6bn)
from international bond markets last week, which has bought it some
time. The package of measures was announced by Slovenia's recently installed Prime
Minister, Alenka Bratusek, and her Finance Minister, Uros Cufer. The measures include a 2% increase in VAT to shore up government finances.
A "bad bank" will also be created to allow the banking sector to offload its
bad debts. Meanwhile a total of 15 publicly-owned businesses will be sold off, including
the second biggest bank, Nova KBM, the flag-carrying airline, Adria Airways, and
Telekom Slovenia. The biggest bank, NLB, has already announced plans to downsize. Announcing the measures, Ms Bratusek said she expected the budget deficit to
rise to 7.8% of GDP this year, but was forecast to fall to 3.3% next year. She also said the VAT increase was decided on as the tax rise with the least
impact on economic growth. Slovenia is seeking to avoid becoming the latest in a strong of EU countries
to seek a bailout from European authorities. Earlier this year Cyprus agreed a 10bn euro bailout with the EU and the
International Monetary Fund (IMF) after its banking sector faced near
collapse.
Access Investments-Building Awareness - European Union-ROMANIA
Saturday, May 25, 2013
The government of Slovenia has
announced a package of measures it hopes will help avoid an EU bailout. The measures include a tax increase, a major restructuring of Slovenia's
ailing banking sector, and a programme of mass privatization. Slovenia's mostly state-owned banking sector is suffering from mounting bad
debts and the government has struggled to borrow money. The European Commission will now consider the plan. It is expected to deliver its verdict by the end of the month. Slovenia has been in recession since 2011, and analysts have cited it as the
most likely country to seek help from the EU following the bailout of Cyprus
earlier this year. European officials have expressed concern over the stability of the country's
banking sector, which is struggling under billions of euros of bad debts. Meanwhile the government's ability to borrow money was dealt a blow last week
when Moody's, a ratings agency, cut Slovenia's bonds to "junk" status. Despite this, the government was able to raise 3.5bn euros (£3bn; $4.6bn)
from international bond markets last week, which has bought it some
time. The package of measures was announced by Slovenia's recently installed Prime
Minister, Alenka Bratusek, and her Finance Minister, Uros Cufer. The measures include a 2% increase in VAT to shore up government finances.
A "bad bank" will also be created to allow the banking sector to offload its
bad debts. Meanwhile a total of 15 publicly-owned businesses will be sold off, including
the second biggest bank, Nova KBM, the flag-carrying airline, Adria Airways, and
Telekom Slovenia. The biggest bank, NLB, has already announced plans to downsize. Announcing the measures, Ms Bratusek said she expected the budget deficit to
rise to 7.8% of GDP this year, but was forecast to fall to 3.3% next year. She also said the VAT increase was decided on as the tax rise with the least
impact on economic growth. Slovenia is seeking to avoid becoming the latest in a strong of EU countries
to seek a bailout from European authorities. Earlier this year Cyprus agreed a 10bn euro bailout with the EU and the
International Monetary Fund (IMF) after its banking sector faced near
collapse.
Subscribe to:
Post Comments (Atom)
4 comments:
Italian consumer confidence drops
Italian consumer confidence dropped unexpectedly in May, reversing a rise in April, as the country remains mired in recession.
ISTAT's consumer confidence index dropped to 85.9 in May from 86.3 in April. Reuters reports:
Consumer spending has long been an Achilles heel of the Italian economy, which has been the most sluggish in the eurozone for at least a decade.
ISTAT reported on Wednesday that people living in families considered to be seriously deprived have doubled in the past two years to 8.6m, or about 14% of the population, as a long recession has eaten into Italians' spending capacity.
Portugal may need targets eased, says prime minister
Portugal is set to meet its deficit targets for this year, its prime minister said earlier, but may need an easing of the bailout terms in 2014.
After agreeing a €78bn bailout in 2011, the country has to reduce its deficit to 5.5% of GDP this year, to 4% in 2014 and 2.5% in 2015. These targets have already been eased in March to take account of Europe's worse than expected recession.
Prime minister Passos Coelho told parliament, as reported by Reuters:
The government does not rule out that further flexibility of the goals may be required for 2014.
Our obligation is to do all in our reach to meet what has been agreed as the preferred target. {But] we have already achieved some flexibility before...and it can't be ruled out that further flexibility may become important for 2014.
Two days after Central Bank of Cyprus Governor Panicos Demetriades announced that the island would “gradually” relax the capital controls it has been forced to adopt since being bailed out in March, authorities took the step of further easing restrictions on foreign banks.
The finance ministry said controls would no longer apply for two major Middle Eastern banks operating on the island. As of today, international clients would be able to make money withdrawals and transfers from Lebanon’s Byblos Bank SAL and Jordan’s Arab Jordan Investment Bank SA, it said.
Resident clients in Cyprus, however, will still face restrictions including a €300 daily cash withdrawal from their accounts.
Cypriot authorities implemented the controls fearing a run on the island's banks after the EU and IMF forced depositors with more than 100,000 euro in their accounts to participate in the €23bn bailout.
Addressing the thorny issue earlier this week, Demetriades said relaxing the restrictions could only be done “gradually”
“Eliminating restrictions too abruptly can lead to disruptive outflows and liquidity problems in the banking sector,” he said in a speech in Nicosia, the island’s divided capital.
In a separate speech, the Cypriot finance minister Haris Georgiades said he regarded the restrictions as Cyprus’ biggest short-term problem and pledged that the country would work “to steadily relax” them.
“I don’t believe in prolongation” of the controls, he said. Cyprus is the first eurozone country to enforce such restrictions.
I´m getting a bit tired with your constant referencing of Zerohedge as a source. In fact I´m starting to suspect this to be pretty much your only source (Like ShiresOfEngland as well).
This blog is not and does not claim to be unbiased in the slightest. It´s a well known Libertarian and Gold-Bug blog that approaches any subject from this angle (think Ayn Rand as their favorite philosopher). Now I do have some sympathy for Ron Paul and I like to follow Zerohedge but they have been wrong about Europe for many years now. They have predicted the imminent collapse of the EU over and over and over again, and so far failed.
Now I know, if you just keep repeating the same for long enough, just like a broken clock, you have a chance to be right every now and then but to keep quoting Zerohedge as a source is a bit silly in this respect.
Cheers.
Post a Comment